Mediation – As An Alternate Dispute Resolution

By | March 30, 2019
Alternate Dispute Resolution - Mediation

Last Updated :

Mediation is a people friendly, effective, efficient, economical, time-saving, less stressful process to resolve the disputes. Mediation helps to build the relationship and serves in the best interests of the parties.


The efficiency of judiciary plays a critical role in democratic societies. Indian judiciary has a huge backlog of cases. As per the information made available by the Supreme Court to the Union Ministry of Law and Justice, the total number of pending cases in the apex court as on December 2017 was 54,719 and on average 1.65 lakh cases are pending in every high court. Due to these problems, it becomes necessary to search for alternatives to litigation which will facilitate judicial system and thus ensure the ends of justice. The problems that arise while resolving disputes through litigation are delay, expense, rigidity of procedures and reduction in the participatory roles of parties. Mediation provides a real alternative to litigation.

Mediation is an assisted negotiation where a neutral third party i.e. a mediator facilitates a mutual settlement between the disputant parties. In mediation, parties resolve their disputes on mutually agreed terms. The approach of mediation is not to focus on guilt or innocence but to focus on parties’ interests. It is a process which is less rigid, provides distinct participation of disputing parties and provides solutions which may go beyond legal remedies. The goal of mediation is to find solutions that legitimately satisfy the needs of the parties. The mediator is not an adjudicator but a facilitator who facilitates communication between the parties to reach solutions. Unlike the judge in a traditional Court setting or even an arbitrator, the role of the mediator is not to announce verdict but to create an environment which facilitates negotiation and in which parties mutually agree to settle. The essence of mediation is confidentiality and whatever transpires in the mediation cannot be disclosed without the written consent of the parties. The nature of mediation is non-binding therefore decision cannot be imposed on the parties. For any settlement to be concluded parties must voluntarily agree to it.

Mediation In India

There are two principal statutes that deal with mediation in India. The rules framed by the Supreme Court and High Courts under section 89 of the Code of Civil Procedure (CPC) deals with court-annexed mediation. Part III of Arbitration and Conciliation Act, 1996 (ACA) deals with private mediation. The latter is based on the UNCITRAL Conciliation Rules, 1980.

As per the Supreme Court judgment in Afcons Infrastructure Ltd. v. M/s Cherian Varkey Construction [2010], it stated that mediation and conciliation are used synonymously in India. In its commentary it said, the terms ‘mediation’ and ‘mediator’ are used they can also be taken to mean ‘conciliation’ and ‘conciliator’.

The primary domestic sources of law relating to mediation in India are as follows:

  • Arbitration and Conciliation Act, 1996 (Part III)
  • Section 89 of the Code of Civil Procedure
  • the Industrial Disputes Act, 1947, which provides for mediation of industrial disputes by officers appointed by the government.
  • the Hindu Marriage 1955, the Special Marriage Act, 1954 and the Family Courts Act, 1984, which require the Court in the first instance to attempt mediation between parties
  • the Legal Services Authorities Act, 1987, which provides setting up of Lok Adalats
  • Section 442 of the Companies Act, 2013, which provides referral of company disputes to mediation by National law Tribunal and Appellate Tribunal read with the companies Mediation and Conciliation Rules, 2016.

In Afcons Infrastructure Ltd. v. M/s Cherian Varkey Construction [2010], the Supreme Court has modelled the ‘excluded category’ of cases that cannot be referred to mediation. They are:

  • representing suits involving public interests
  • cases involving the grant of authority by the court after enquiry (grant of probate), cases involving serious allegations of fraud, cases requiring protection of courts, suite for the declaration of titles against the government and cases involving prosecution for criminal offences that cannot be compounded.
  • A challenge to grant or refusal of the legal patent can be done only in legal forums; however, where a commercial resolution is possible, mediation can be applied.

Why Should India Implement Mediation At A Large Scale?

Mediation is a critical part of the solution to the profound problem of arrears of cases in civil courts. Mandatory mediation through courts has a legal sanction now. In India, mediation is primarily court-annexed. If a settlement is reached in Court-annexed mediation, then the parties with the assistance of mediators frame the settlement agreement which is duly signed by the parties and the mediator and then it is sent to the court for the passing of an appropriate order.

In Salem Advocate Bar Association v. Union of India (2005) 6 Supreme Court Cases 344, the Supreme Court construed clause (d) of section 89(2) of Code of Civil Procedure to mean that when mediation succeeds and when the agreement is made on the consensus of both the parties, the mediator will send the report of settlement agreement to the court. Should there be no settlement, the mediator sends the report to the Court stating that the mediation was not settled, the reason for such non-settlement is not mentioned by the mediator. Thus, mediation is a people friendly, effective, efficient, economical, time-saving, less stressful process to resolve the disputes. Mediation helps to build the relationship and serves in the best interests of the parties.

By – Priyanka Chauhan,

Government Law College, Mumbai

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Author: Priyanka

Student at Government Law College Mumbai