By: Deborshi Sarkar and Anirudh Krishna
(This post is the first of a two part series on the topic – ‘Mandatory Mediation: an Oxymoron?’)
Alternate Dispute Redressal (ADR) mechanisms play an integral role in providing access to justice to everyone regardless of various social or financial constraints. One such notable mechanism is mediation, a neutral third party or the mediator through negotiation and facilitation, helps disputing parties amicably arrive at a at a middle ground and thereafter reach a settlement. Since mediation is far from a popular alternate dispute resolution mechanism in India, initiatives have been taken of late to build an effective framework to popularise and incentivize mediation. Such initiatives include the introduction of mandatory pre-litigation mediation via an amendment in the Commercial Courts Act, 2015.However, no concrete data yet exists to determine the effectiveness of the provision in popularising mediation. Recent developments in the Indian ADR scenario has witnessed the enactment of the Mediation Bill, 2021 which mandates mediation in civil disputes. But, attempts at mandating mediation have been vehemently opposed to prevent depletion of the voluntariness of parties, which could render the very essence of mediation being a mutual proceeding futile. However, the authors argue that the Mediation Bill, 2021, alters the voluntariness of the parties to mediation to a permissible extent for reasons explained hereunder.
ISSUE SURROUNDING MANDATORY MEDIATION
Mandatory mediation compels parties to attempt to mediate in certain pre-decided forms of cases. However, as the quintessence of mediation is voluntariness, it has been frequently argued that when parties are compelled to attempt to mediate, nonetheless compelled to settle, the voluntary decision making of the parties is abated. Mediation can be mandated through three popular methods. The first method is through legislative schemes providing for the compulsory referral of cases on certain matters to mediation. The second method, well-known as ‘court-referred mediation’, allows the courts to refer certain cases to mediation irrespective of the consent of the parties. The third method, known as quasi-compulsory mediation, through which mediation is indirectly mandated by the imposition of costs if a party refuses to undertake mediation before instituting a suit. The demand to incorporate the three methods of mediation within a single legislation has led to the creation of a separate mediation law in India, the Mediation Bill, 2021 (hereinafter ‘the Bill’). Section 6 of the Bill, which provides for the institution of mandatory pre-litigation mediation in civil and commercial matters has yet again raised the argument of robbing parties of their voluntariness. Continually, at great length, mandatory mediation has been called an oxymoron and an ‘antithesis of mediation’. Although mandating mediation in a phased manner for certain classes of disputes may prove to be beneficial, in the same vein, the same allegedly detracts parties off their consent by coercing them to mediate before approaching courts.
Coercion Within and not Into Mediation
Nolan Haey has defined consent as an integral part of mediation. He defines two types of consent as being fundamental to mediation, particularly, ‘front-end participation consent’ and ‘back-end outcome consent’. In simpler terms, they disentangle as ‘compulsion to mediate and compulsion to settle’. Although the former may result in escalating the latter, it is imperative to understand the innate variance between the the two. Section 6 of the Bill postulates a pre-litigatory form of mandatory mediation. This provision makes it mandatory, in civil matters to compulsorily opt for mediation before filing a suit in any civil court, notwithstanding an agreement for the same. However, an analysis of the above-mentioned provision discloses that the essence of the mandate here is limited to a compulsion to enter into mediation rather than compelling a settlement. Such compulsion is merely limited to attempting mediation rather than forcing a settlement. Section 6 in its unerring essence would construe as an attempt to mediate rather than forcing parties for a settlement through mediation. Additionally, in consonance with Turkey’s meditation law and section 12A of the Commercial Courts Act, the present bill allows parties to approach courts for interim relief, circumventing the need for parties to compulsorily attempt mediation in exceptional circumstances. Section 8(1) of the bill ensures the liberty of the parties to approach appropriate courts for interim relief before and during the continuation of mediation proceedings.
One of the premier advantages of mandatory mediation, as divulged by Hutchinson is that it gradually produces skilled mediators resulting in ameliorating the quality of mediators and improving the legal health of the country. However, it is equally believed that inducing mandatory mediation instead of making the option of mediating voluntary depletes the process of its benefits. Within this frame of reference, it is imperative to understand that party autonomy and consent are limited to ‘within mediation’ and not ‘into mediation’. This boils down to the fact that the essence of mediation would not be destroyed if the parties reach a mediated settlement, even though the initiation was involuntary . Thereby, it would be farfetched to assume that mandating an attempt to mediate would rob parties of their voluntariness completely. The Bill through an ‘opt out’ clause has ensured that parties do not face any form of coercion post attempting mediation. Section 20(1) of the Bill fundamentally necessitates two formal meetings of the parties with the mediator at the beginning of the mediation proceedings. This is to be followed by an easy procedure to step out of the proceedings without arriving at a settlement agreement. This straightforward ‘opt out’ provision rules out the prospect of any form of coercion on the parties and ensures that the parties have the free-will to leave the mediation proceedings after the mandatory element has been fulfilled.
Cite as: Deborshi Sarkar and Anirudh Krishna , ‘Mandatory Mediation: an Oxymoron? (Part 1)’ (The RMLNLU Law Review Blog, 29 May 2022) <https://rmlnlulawreview.com/2022/05/29/mandatory-mediation/> date of access