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What Challenges Should the Proposed Mediation Act of India Address?

Recently, the Supreme Court of India, admitting that there is ‘a dire need to enact Indian Mediation Act..’ directed constitution of a Committee to draft a separate legislation for administration of mediation proceedings across the country. In contra distinct to private mediation, court-annexed mediation proceedings are regulated by guidelines formulated by respective High Courts for their own Mediation Centres and few other domestic legislations depending on the nature of dispute. Though there is a widely felt need for a separate enactment to regulate the mediation process, there is a level of scepticism over necessity of a new legislation emerging within the mediation fraternity. Fundamental aspect of ‘Mediation’ lies in its informal process that leads to a collective decision acceptable by both the parties to a dispute. In mediation, parties retain control of the outcome and tailor a solution to fit their needs. And any sort of institutional regulation and control of mediation could dilute its distinctive character and can hamper its viability as a dispute resolution tool. 

On one hand institutionalised intervention is less sought to safeguard the core values and principles of the mediation process, on the other hand, certain issues associated with the mediation process, need court intervention. While the foregoing dichotomy persists, this article examines the challenges emerging in the current mediation framework of India that need a statutory overhaul. 

  1. Enforcement of Settlement Agreement: There is no specific provision of law that governs enforceability of mediated settlement agreements. Presently, Settlement Agreement take the colour of an ‘arbitral award’ on fulfilling the criterion stipulated under the Arbitration and Conciliation Act, 1996 and be enforced as an arbitral award under the Act or be enforced as a contract under the Contract Law (Indian Contract Act, 1872) whereas, the court-annexed mediation outcomes are enforced by Courts through a Decree in favour of one of disputants or likewise. Therefore, it is imperative for the proposed legislation to look at ‘homologation of settlement agreements’ i.e., enforcement of the settlement agreement(s) by the courts and jurisdiction. 

  2. Cross Border Dispute: India is a signatory to the United Nations Convention on the International Settlement Agreements Resulting from Mediation (“The Singapore Convention on Mediation”). The Convention applies to cross border commercial disputes resolved through mediation and the enforceability of outcome in the courts of any signatory state in ‘accordance with their own rules of procedure and under the conditions laid down in the Convention, this paves way for settlement outcomes to be recognized internationally. However, the Convention excludes from its scope settlement agreements related to consumer, family, inheritance, and employment matters (Article 1.2) those enforceable as a judgment or as an arbitral award (Article 1.3). Therefore, it is not only pertinent for the statutory intervention to define and distinguish domestic and cross-border mediation, but also, stipulate distinct manner of enforcement of domestic mediation settlement outcome and in case of a cross-border mediation outcome in accordance with Indian law and / or as per clauses in the mediation agreement reached by the parties.

  3. Confidentiality: A crucial rule of mediation is to maintain confidentiality of all communications made, including ‘privileged’ and ‘made in evidence’ during mediation proceedings. Currently, a non-disclosure agreement is signed by the parties, mediator and the representatives with a rider that such communications shall neither be produced before court of law unless specified nor be disclosed to any third party(s). However, the sequitur of breach of such non-disclosure agreement requires certain statutory protection. 

  4. Regulatory Authority: As mentioned above, the ‘competent authority’ regulating mediation proceedings especially the ‘court-annexed’ mediation is prescribed in relevant domestic laws and in respective High Court Rules, Civil Procedure Code, 1908 etc. depending on the dispute. Irrespective of an independent mediation legislation, the self-regulating mediation process (private mediation) requires competent, efficient, and certified mediators to conduct mediation. Accordingly, to bring in uniformity over the role of mediator and the mediation process, a ‘competent authority’ with multidisciplinary expert members must be nominated. The said regulatory authority shall devise guidelines pertaining to ethics and conduct of mediator; qualification and training of mediator; accreditation of mediator; role and appointment of the mediator; time limit and termination of mediation as required. 

Covid-19 has revitalised the interest in e-dispute resolution and ergo identity verification, electronic submission of evidence, validity of electronic signatures, secured online case management and others that stem from increased utilisation of digital technology including for mediation must also be contemplated in the proposed statutory intervention. Also, the Singapore Convention is a timely opportunity to promote international commercial mediation. 

Notwithstanding the understanding that court-annexed mediation is established, and the private mediation is in the nascent stage expanding its scope, there is a need to formalize and institutionalize the provisions of process of mediation (private mediation and court-annexed) viz. especially aspects enumerated above. The proposed Indian Mediation Act / statutory intervention, at best ought be non-exhaustive as too much formalism can result in unjust outcomes. The proposed legislation must attempt to promote mediation and e-mediation as a dispute resolution tool and formulate with an objective to provide incentives that build confidence in parties on benefits of mediation being a cut above litigation or alike.  

                        author

Sneha Vardhani

I am a practicing advocate enrolled with the Bar Council of Telangana, India. I am currently involved in property and commercial litigation. I have been actively part of a District Family Counselling Centre that involves practicing mediation for matrimonial disputes. I have graduated from National Academy of Legal Studies and… MORE >

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