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ADR in Civil Litigation


Authored by Dipali Jaggannath Nikam


Keywords : Section 89 of Code of Civil Procedure 1908, Arbitration, Mediation, Conciliation, Lok-Adalat, Legal Services Authority Act 1987, Malimath Committee, Arbitration, and Conciliation Act 1996.


Abstract

There is no scarcity of cases in the Indian Judiciary and every year the number of fresh suits just keeps on adding more to the tally which led to an increase in the backlog of cases. Looking at this, the Indian Government and Judiciary System of India have combined their efforts and somehow brought a reduction in the tally of pending cases.


The government introduced many initiatives like the establishment of specialized courts, an increase in the number of judges, speeding up the process, etc. However, among all the measures, the most significant measure is the amendment of Section 89 of the Code of Civil Procedure 1908. The amended Section 89 mandated the courts to resolve the civil litigation disputes through the mechanism of Alternative Dispute Resolution (ADR).


The most common forms of ADR for civil litigation are Arbitration, Mediation, Conciliation, or Lok-Adalat. The mechanism of ADR is open and is extra-judicial and applies to various matters of civil, partnership, commercial, intellectual property, family, personal injury, industrial, insurance, and product liability including other commercial disputes. ADR is usually less formal, less time-consuming, and less expensive than a trial and it gives people more opportunity to determine when and how their dispute to be resolved.


Introduction

ADR stands for Alternative Dispute Resolution, It is a legal Term in Law which helps in resolving the civil litigation without the formal procedures. It was introduced in 2002 as an amendment in Section 89 of the Code of Civil Procedure to provide an alternative method to the official judicial procedures.


It offers parties to resolve their differences outside the actual courtroom and also saves the cost of litigation for people who are financially weak and cannot afford the official legal process and therefore lose out on their case due to finance. The key reason behind the amendment was to provide a congenial, peaceful, amicable, and mutual settlement between the disputing parties without resorting to the court intervention.


Over Ninety percent of the litigations are settled without the intervention of the court in many different countries and the cases which cannot be settled amicably can be taken to court. This way the cases are filtered out and the court only sees the cases which are not settled on their own. Even in civil matters, the conflicting parties have an option to choose negotiation and resolve the disputes without running to the court. For civil cases, it becomes more important and the ADR mechanism promotes realistic and mutually agreeable solutions to complex civil disputes.

Rules and Relevance of Section 89 of The Code of Civil Procedure

Section 89 of the Code of Civil Procedure (Amendment) Act became effective from 1st July 2002 and it was the Malimath Committee who proposed the idea of Conciliation as a technique in ADR in their 29th report of the law commission which led to the enactment. The settlement of disputes outside the court was formulated under four divisions

 Arbitration

 Mediation

 Conciliation

 Judicial Settlement or Lok Adalat


There were provisions made for each division. The Arbitration and Conciliation case proceedings were done under the provisions of Arbitration and Conciliation Act 1996 (26 of 1996) whereas in Lok Adalat proceedings the court shall refer to the provisions of sub-section (1) of Section 20 of the Legal Services Authority Act, 1987 (39 of 1987). For Mediation, the court shall follow the procedure that may help resolve the dispute between the parties.


The Rules for such provisions are given below

 The parties can opt for any of the modes of ADR under the direction of the court. After the court records the admissions and denials the court shall direct the parties of the suit to opt for any of these modes of settlement outside the court as given in Sub-Section (1) of Section 89. Once opted by the parties the court shall fix a date for appearance to settle the dispute.


 The next step is to appear before the conciliatory forum or authority for conciliation of the suit

 Once the conciliation efforts are failed and the court finds that further reconciliation is not possible or it would not be proper in the interest of justice then the conciliation forum or authority will refer the matter to the court and ask the parties to appear before the court on the affixed date.

Arbitration

Arbitration is a mechanism of ADR wherein the parties submit their dispute to an independent and impartial third party known as arbitrators. If a case is submitted to Arbitration by the court under section 89 of the Code of Civil Procedure then it would proceed under the Arbitration and Conciliation Act 1996 and the consent of parties is crucial under this section. The decision taken by the arbitrator is referred to as an arbitral award and it is treated as a decree


Below are some of the types of Arbitration

 Ad Hoc Arbitration

 Institutional Arbitration

 Statutory Arbitration

 Flip-Flop Arbitration

 Domestic Arbitration

 Fast-Track Arbitration

 Contractual Arbitration

Mediation

Mediation is a process through which the conflicts are resolved through the assistance of a neutral third party called a mediator. The role of a mediator is to put forward a solution that may be amicable to both parties and let the disputed parties reach a negotiated resolution. A mediator takes into account the issues of both parties and reaches a solution that is beneficial for both parties however this mechanism is completely controlled by the parties and the mediator's role is only limited to express his views and not direct it on the parties. The procedure of mediation is as follows

 Opening Statement

 Joint Session

 Separate Session

 Closing

Conciliation

Conciliation is a process through which the conflicts are resolved through the assistance of a neutral third party called a conciliator. The conciliator motive is to make the parties reach a mutual understanding and settlement through the process of the Arbitration and Conciliation Act 1996. The decision by the conciliator is non-binding and this mechanism of ADR is less formal.

Lok Adalat

Lok Adalat is famously known as the People's Court. The Lok Adalat is chaired by the chairman who can be retired judicial officers and two members which can be from the legal fraternity or social activists. The National Legal Services Authority or NALSA and other legal institutions have contributed a lot in expanding the functioning of Lok Adalat under Section (1) of the Legal Services Authority Act, 1987. The Lok Adalat can take into account the cases which are

 Pending before any other court or

 Cases which have never been brought before any court

The decision awarded by the Lok Adalat is final and is non-appealable in any court of law. The procedure is very simple and beneficial for the civil litigants as there is no court fee for this case.


Conclusion

The key objective of the section on 89 of the Code of Civil Procedure is to expedite the process of judgment by utilizing the modes of Alternate Dispute Resolution. And the mechanism of ADR is the most preferred mode to resolve disputes globally. There are few drawbacks of Section 89 like the litigants are unaware of the different forms of ADR available, the section has not been implemented in letter and spirit by the stakeholders and the important drawback is that ADR referral is not explained by the advocates or judges to the litigants. But even after these drawbacks, ADR is the most useful, cost-effective, and fastest mode of processing civil litigations.


References

[1] Diva Rai, ”Alternative Dispute Resolution Under Civil Litigation”, Ipleaders, June.28.2020,

https://blog.ipleaders.in/alternative-dispute-resolution-under-civil-litigation/

[2] “Alternative Dispute Resolution For Consumers”,GOV.UK,June.23.2015, https://www.courts.ca.gov/3074.htm

[3] “Alternative Dispute Resolution In Civil Disputes”, Law Teacher, May.31.2019, https://www.lawteacher.net/free-law-essays/civil-law/alternative-dispute-resolution-in-civil-disputes.php#

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