THE ROLE OF ALTERNATIVE DISPUTE RESOLUTION IN INDIAN LITIGATION

Author: Deeksha Chhipa, Law Center 2, Faculty of Law, University of Delhi

Alternative dispute resolution is the mechanism to solve the dispute outside the traditional court setting. ADR involves the resolution of disputes and embodies the concept of making the justice delivery system more accessible and beneficial for the parties involved, ensuring swift case settlement. These mechanisms include Arbitration, Mediation, Conciliation, Negotiation, Adjudication, Judicial Settlement. ADR helps streamline an overwhelming volume of cases by offering a fast and cost efficient method for settling disputes. Both commercial and civil disputes can be resolved through ADR. It can be regarded as an alternative approach to the justice delivery system in india. The main aim is to critically analyze the legal framework governing ADR mechanisms in the Indian legal system and to gather insights from legal professionals who regularly engage with ADR.   

KEYWORDS 

ADR, Arbitration, meditation, judicial system, dispute resolution 

It’s time to consider creating a space for poor and vulnerable people who want their issues resolved rapidly by the legal system. Hindrance in resolving conflicts via standard courts, for virtually any valid reason, has sufficiently and practically nullified the core aim for which people go before the court. To give social justice to many poor, deprived and those in need who want their complaints heard in court, the important ideas of Justice delayed is justice denied and Justice hurried is Justice buried must be given additional consideration so we have to discover how to connect them. Therefore, certain ADR ways are seriously necessary to add to what courts now provide. Across the world, multiple initiatives have been introduced to improve the efficiency of the judicial system as well as make the ADR system readily available for settling pending disputes. These initiatives have also been introduced at the pre litigation stage. ADR gives a way to cut down the huge number of cases by offering a fast and cheap way to take care of many disagreements. Instead of going to court, ADR means a set of different ways to deal with conflict. 

According to Black’s Law Dictionary, alternative dispute resolution or ADR is a specific “procedure for settling a dispute by means other than litigation, such as arbitration or mediation. Furthermore according to Halsbury’s Law of England, ADR is another way to settle disputes without litigation and includes mediation, conciliation, expert determination, and early neutral assessment. Therefore, a number of ways of solving disputes outside of court use the phrase ADR. a collection of these apply. It also includes the process of negotiation where two groups work out an issue between themselves by talking to each other as well as without aid from an outside source. It could also have things like conciliation and mediation, where a totally unbiased person gets involved. Therefore, it is really a mechanism for settling disagreements and arguments that depends on personal, agreed upon solutions between people, with or without the help of an unbiased person.

The forms of ADR include Arbitration, Mediation, Conciliation, and Lok Adalats. Arbitration is a system where the third party who is independent makes a decision on the right and responsibility or duties of the two sides. In Mediation\, the two sides come directly to an agreement whereas in conciliation the solution to informal processes that are advantageous particularly to the lowest rungs of society because of their economic effectiveness. 

India still has an impressive pendency of over 40 million cases and in most cases,the cases never adjudicated, much less disposed of within decades. The overwhelming backlog indicates  the downfall of the traditional court system and the reason there is a need for an ADR system. ADR offers quicker and less expensive ways of resolving disputes, cutting down on delays and increasing access to justice. Conflict is proposed by the conciliator itself. Lok Adalat formerly referred to as village courts are classic examples of ADR mechanisms in accordance with constitutional provision particularly the provision of Article 21 and Article 39A. Article 21 is therefore the protection of life and personal liberty with the right to receive free, speedy and impartial justice. On this, ADR accommodates the right note self assembly as its rapid and low cost methods aim to make solutions at quick speed. Access to justice and free legal aid is one of the b biggest concerns of Article 39A, which is in agreement with ADR’s egalitarian and non discriminatory approach. 

The FICL Survey revealed a clear preference in arbitration among participants, who favored it over other forms of Alternative Dispute Resolution mainly due to its cost- effective as well as enforceability. In arbitration, there was a clear preference for ad hoc arbitration and its cheaper price relative to institutional arbitration. However, the survey also showed different views about the recent changes in law, especially the establishment of commercial courts for major cases, which was supported by a majority of people surveyed. Despite arbitration having a number of benefits, several big problems were found, such as elevated expenses, arbitrators possessing insufficient knowledge, and proceedings requiring excessive time, which make people question whether it functions effectively. Additionally, a collection of organizations reported using conciliation or mediation proceeding arbitration. However, truly serious concerns about the enforceability of such resolutions do persist, indicating a definite need for further improvements to the ADR landscape. 

While the efficiency and also the cost effectiveness of ADR are definitely helpful, the reasoning. There are useful advantages to using ADR. However, the reason to use ADR goes beyond them.

Keeping Connections : ADR methods, especially mediation, may aid in preserving relationships between disputing parties. Unlike lawsuits, which can encourage animosity, ADR truly encourages dialogue and understanding, possibly allowing in turn for continuing cooperating perpetually beyond disagreement.

Alternative Dispute Resolution allows parties to have increased control over and input into the matter. Unlike court proceedings where the judge dictates the dispute resolution process. As a result, ADR lets those involved take part in creating the resolution. 

Flexibility and CREATIVITY : ADR allows for exploring options beyond the win lose framework of traditional litigation. Parties can develop creative solutions that address their specific needs and interests, leading to more mutually beneficial outcomes. 

The history of ADR in India is not only the precursor of the modern legal system ; it reflects a deep cultural tendency towards community driven conflict resolution and social harmony. The following is a closer look at this rich history. 

Pre colonial period : Traditional of Panchayat and caste council 

Traditional Indian society was focused on social harmony and collective good. This manifested itself in the widespread use of informal conflict resolution mechanisms like village panchayats and caste councils. Such a council consisting of influential elders and community leaders, functioned by way of discussion, mediation, and the use of customary law. Their ultimate goal was to achieve reconciliation and restore harmony within the community, prioritizing compromise over adversarial proceedings. This emphasis on consensus and social order led to the eventual acceptance and accommodation of formal ADR mechanisms. 

Colonial Impact and Development of Arbitration 

The coming of the British raj in the 18th century marked the beginning of formal English common law based legal system. The system further has provision for arbitration, which was used mainly to commercial disputes between Europeans and did not significantly influence traditional community based conflict resolution practices in rural india. 

Post Independence and The Emergence of Modern ADR

Since India attained independence in 1947, the legal framework experienced dramatic reforms. The judicial system, while continuing to be the primary forum for dispute resolution, there was growing recognition of the  need for better and more responsive alternatives, particularly in the aftermath of increasing case backlog. This paved the way for the enactment of the arbitration and conciliation act (1996), the applicability of which greatly enhanced the legal framework for ADR in India. This act, based on UNCITRAL Model law on International Commercial Arbitration, provided a robust mechanism for the conduct of both conciliation and arbitration proceedings, fostering their broader extension to other forms of  disputes. 

Booz Allen and Hamilton Inc. v. SBI home finance Ltd. (2011)

This case emphasized the importance of arbitration agreements and clarified the scope of judicial intervention in arbitration matters. The supreme court held that the courts should not interfere in matters that are subject to arbitration unless there is clear violation of arbitration agreement. 

Indian Oil Corporation Ltd v. Amritsar Gas Service (1991)

This case established that arbitration is a preferred method of dispute resolution and highlighted the need for courts to refer disputes to arbitration when there is an avoid arbitration agreement in  place. 

Perkins Eastman Architects DPC V. HSCC (India) LTD. (2019)

This landmark ruling clarified the process of appointing arbitrators, stating that unilateral appointment of a sole arbitrator is not permissible. The court emphasized the need for mutual agreement between parties in the appointment process, thereby reinforcing the principles of fairness and equality in arbitration.  

Afcons Infrastructure Ltd. v. Cherian Varkey Construction Co. (2010)

This case addressed the issue of the enforceability of arbitration awards and the role of the courts in reviewing such awards. The supreme court ruled that the courts should respect the finality of arbitration awards unless there are grounds for setting them aside under the arbitration and conciliation act. 

National insurance co. Ltd. v. Boghara Polyfab Pvt. Ltd. 

This case highlighted the importance of the arbitration process in resolving disputes efficiently. The supreme court ruled that the courts should not interfere with the arbitration process unless there is a clear violation of the principles of natural justice. 

M/s Shree Ram Mills Ltd. v. Utility Users’ welfare association (2007)

 This case reinforced the principle that arbitration is a preferred mode of dispute resolution and that courts should encourage parties to resolve their disputes through arbitration rather than litigation. 

LAWS RELATED TO ADR IN INDIA 

• Civil Procedure code 1908

• India Arbitration Act, 1899

• The Arbitration (protocol and convention) Act, 1937

• The arbitration act of 1940

• Arbitration and conciliation act, 1966 

The progress of human societies has brought about important advances in the ways disputes are managed. The principal element has been the increase of Alternative Dispute Resolution instruments. It was driven by the goal of resolving issues efficiently. There was no excessive time or elevated cost involved. The evolution of ADR methods make for a sticky wicket, so it's obvious that legislative bodies and judicial systems had problems coordinating the systems and making the rules that control the system. The history of ADR mechanisms started when laws about arbitration were introduced, which then experienced changes that were truly important changes over time. As time passed, multiple kinds of ADR techniques appeared and were incorporated into Indian legislation. The government made absolutely certain that these approaches were thoroughly customized for particular sectors like the commercial courts act of 2015 and the micro, small, medium enterprise development act of 2006. The legal community has clearly expressed some dissatisfaction regarding revision from the M. Jagannadha Rao Committee Report. At the present time the government in India is undertaking additional steps for the improvement of multiple ADR mechanisms, targeting to position India as a global hub in arbitration and other ways for resolving disputes. 

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