Mandatory pre-litigation mediation requires a lot of groundwork before deployment
Mediation is gaining ground globally as an effective dispute resolution mechanism. The pro-mediation trend in India in particular has been on the rise in the recent past, with the government taking various measures such as introducing mediation as a pre-litigation tool in some specific sectoral laws, and being one of the first signatories of the UN. Convention on International Settlement Agreements Resulting from Mediation (Singapore Convention). Amidst these various policy measures, a uniform national legal framework for mediation will provide a much needed boost. Sensing the need for independent legislation for mediation, the Ministry of Law and Justice recently released the Mediation Bill 2021.
The Mediation Bill is an important step forward in establishing a clear framework for the mediation process in India. The bill seeks to address various aspects of the process and key principles of mediation, including issues such as confidentiality, self-determination and volunteering. It provides a regulatory framework for the practice of mediation and, significantly, provides a mechanism for the recognition and enforcement of mediation agreements, both national and international.
One of the important features of the bill is the introduction of a mandatory pre-litigation mediation process with an opt-out clause. It requires that a party to the dispute take steps to resolve disputes before initiating a dispute through mediation as a pre-litigation mechanism. However, the party concerned can âopt outâ of mediation after attending at least one mediation session if they wish. This compulsory mediation process with an opt-out clause is no stranger to the Indian context. For example, commercial disputes cannot be brought before commercial courts unless an attempt to resolve the dispute through mediation is initiated, as provided for in the Commercial Courts Act 2015.
From a political point of view, one of the main reasons for invoking the compulsory recourse to mediation is to ensure that it acts as a boost for the parties to the dispute to resolve their differences and reach a settlement. early resolution, nipping disputes in the bud. Early resolution of disputes, in addition to saving costs and time for the parties, will also significantly reduce the length of cases in an already overburdened court system. This model of compulsory mediation with opt-out clause has been successful in countries such as Italy and Turkey.
Empirical studies in these countries show that the settlement rate is much higher in a mandatory mediation setting. In addition, there appears to be a growing interest among countries to invoke presumptive mediation or compulsory mediation with an opt-out clause to give mediation the boost it needs as an effective dispute resolution mechanism. .
As much as the supporters are in favor of the compulsory recourse to mediation, as many voices are opposed to it.
For them, the idea of ââcompulsory mediation is contrary to fundamental principles; they argue that forcing the parties to mediate could result in an unwilling settlement. Moreover, when the balance of power of the parties is disproportionate, the binding nature of the process could aggravate such a divergence of positions.
This school of thought also seeks to argue that compulsory mediation precludes equal access to justice, as parties would be better able to resolve certain disputes through judicial channels than forced settlement, with the right of access to courts also being an issue. fundamental right of citizens. Moreover, experience shows that in countries with little awareness of mediation, compulsory mediation comes down to a simple empty formality, while being a burden on taxpayers’ money.
The question that arises in the Indian context is whether India is ready for compulsory mediation as a pre-litigation tool. There can be no clear answer to this in the absence of empirical evidence.
The unsatisfactory response to compulsory mediation under the Commercial Courts Act 2015 is, however, a clear indicator that there are sufficient grounds for skepticism. There is a long way to go to make mediation known, all the more so in the community and private space of mediation, before introducing it as a compulsory remedy.
Mediation nudge: alternative paths
The success of compulsory mediation with an opt-out clause in Italy may have prompted Indian decision-makers to turn away from it.
But that said, India could have gone down the path of countries that did not opt ââfor compulsory mediation and instead followed the basic principle of maintaining voluntary mediation. For example, countries like Ireland, Singapore and Scotland have made the legal fraternity responsible for educating their clients about mediation, as a prerequisite for initiating litigation. Lawyers and notaries must declare to this effect in court, before they can initiate legal proceedings.
While this certainly cannot be seen as a solution to all the problems that might arise, it would address one of the critical concerns of involving the legal community, which would play a major role in the success of the mediation framework. . It is needless to mention the considerable efforts of the judiciary to promote mediation, which has resulted in relatively successful court-annexed mediation, even in complicated and long-outstanding disputes.
However, the success of mediation outside of court intervention, such as private or community mediation, rests largely in the hands of the legal community. Awareness of the importance of mediation in legal fraternity is still very low. In a situation of lack of sufficient resources with the necessary professional expertise, with only a few expert mediators in the country, invoking compulsory mediation would lead to an explosion of cases.
While the establishment of a regulatory body in the form of the Mediation Council of India will certainly accelerate the evolution of mediation, India must be patient and ensure that mediation becomes a default mechanism. that the parties adopt voluntarily, knowingly, rather than a mandatory remedy. is imposed on them.
(The authors are lawyers at J&M Legal)