18 May,2021 10:39 AM IST | Mumbai | BrandMedia
Tushar Kumar
ADR, or Alternative Dispute Resolution, provides a voluntary alternative to the accepted practice of using the courts to settle civil disputes. The principle forms of ADR include Arbitration, Conciliation and Mediation. ADR provides a confidential dispute resolution mechanism outside of a court of law, by which a dispute or difference is submitted to an impartial individual(s), either for determination or to assist the parties in reaching a negotiated resolution of their dispute. The mechanism can lead to a binding resolution is provided for in the agreement by which the parties agree to submit their dispute to ADR. Let's delve further into the three principle modes of ADR:
Arbitration is a private and generally informal trial procedure for the adjudication of disputes. It is an extrajudicial process. It functions as an alternative to conventional litigation. It yields binding determinations through less expensive, more efficient, expert, and fair proceedings. Although it can engender settlements, arbitration is not a means of achieving dispute resolution through party agreement. Arbitration is neither negotiation nor mediation. By agreeing to arbitrate, the parties confer full legal authority on the arbitrators to adjudicate their disputes, i.e., to render a final disposition on the matters submitted that can be enforced through coercive legal means. Party agreement sets the process in motion, but it does not dictate (necessarily) the procedure nor (certainly) the outcome. Once the parties entrust the arbitral tribunal with the authority to rule, they - subject to a possible intervening settlement - relinquish control of the proceedings, the dispute, and its resolution to the arbitrators and - to a lesser extent - the administering arbitral institution.
Mediation is another method of ADR available to parties. Mediation is essentially a negotiation facilitated by a neutral third party. Unlike arbitration, which is a process of ADR somewhat like a trial, mediation doesn't involve decision making by the neutral third party. ADR procedures can be initiated by the parties or maybe compelled by legislation, the courts, or contractual terms. When parties are unwilling or unable to resolve a dispute, one good option is to turn to mediation. Mediation is generally a short-term, structured, task-oriented, and "hands-on" process. In mediation, the disputing parties work with a neutral third party, the mediator, to resolve their disputes. The mediator facilitates the resolution of the parties' disputes by supervising the exchange of information and the bargaining process. The mediator helps the parties find common ground and deal with unrealistic expectations. He or she may also offer creative solutions and assist in drafting a final settlement. The role of the mediator is to interpret concerns, relay information between the parties, frame issues, and define the problems.
Like mediation, conciliation is a voluntary, flexible, confidential, and interest-based process. The parties seek to reach an amicable dispute settlement with the assistance of the conciliator, who acts as a neutral third party. The main difference between conciliation and mediation proceedings is that at some point during the conciliation, the conciliator will be asked by the parties to provide them with a non-binding settlement proposal. A mediator, by contrast, will in most cases and as a matter of principle, refrain from making such a proposal. Conciliation is a voluntary proceeding, where the parties involved are free to agree and attempt to resolve their dispute by conciliation. The process is flexible, allowing parties to define the time, structure, and content of the conciliation proceedings. These proceedings are rarely public. They are interest-based, as the conciliator will when proposing a settlement, not only consider the parties' legal positions but also their commercial, financial and/or personal interests. Like in mediation proceedings, the ultimate decision to agree on the settlement remains with the parties.
Note: The author is a prominent lawyer based in New Delhi practicing Commercial Disputes Resolution and ADR across various Courts and Tribunals throughout India including but not limited to the Supreme Court of India, Delhi High Court, National Company Law Tribunal Delhi, etc.
