Unravelling the Layers: A Critical Analysis of the Mediation Act of 2023 -Navigating Opportunities and Challenges in Alternative Dispute Resolution

Abstract

With the recent passing of the Mediation Act, there is a belief of getting relief since there would be regulation of the process of meditation leading to more preferring to resolve their dispute in Mediation cells, giving a relief in the already 4.7 crore pending cases, yet if delved deep into it there are certainly many shortcomings of this act. This article will critically analyze the Mediation Act of 2023, by exploring both sides of the coin.

The researcher will delve into the transformative impact anticipated from the Mediation Act of 2023 on the Indian legal landscape, underscoring the growing significance of Alternative Dispute Resolution (ADR). Notable features to be explored include its applicability to both domestic and international mediations, the establishment of the Mediation Council of India (MCI), and provisions facilitating online mediation.

The researcher will analyze the act’s anticipated strengths, such as promoting confidentiality, imposing time limits, and robust enforcement mechanisms. Additionally, concerns like the potential misuse, the distinction between registered and unregistered mediators, and the exclusion of specific disputes will be examined.

The research would also delve into Chapter X’s innovative approach to provide a community mediation for familial harmony. Mandating mutual consent and a trio of mediators as it unveils a dynamic solution to family disputes, promising both possibilities and pitfalls in the quest for peaceful resolutions.

The researcher will conclude by proposing future steps for phased implementation, advocating for reduced time frames, emphasizing capacity building, and highlighting the potential of leveraging disruptive technologies for the effective implementation of mediation in India.

Introduction

The main aim for the introduction of this act is to formally build the system of Alternative Dispute Resolution specifically focusing on mediation. Mediation is one of the most effective ways of resolving disputes and this certainly because of it being economical, less time consuming, most importantly it leads to an agreement in 70-80% of the cases which means it has a higher rate of adherence.

The main objective of the bill is to form a bridge between arbitration and mediation of disputes. This would lead to “pre-litigation” prior to proceeding toward the courts which are already overburdened (1). Mediation and conciliation, recognized forms of dispute resolution, have found mention in various legislations over the years, which includes the “Arbitration and Conciliation Act, 1996”, the “Code of Civil Procedure, 1908”, the “Companies Act, 2013” and “Commercial Courts Act, 2015”.

Despite their inclusion in existing laws, a need for comprehensive legislation exclusively addressing the intricacies of mediation arose. Responding to this need, the Mediation Bill, 2021, had been proposed in the Rajya Sabha in 2021, for promotion of mediation as a mode of ADR, particularly through “institutional mediation” (2). The 2023 Mediation Bill was introduced after the Cabinet approved changes to the 2021 Bill.

The Bill underwent a thorough examination by the Parliamentary Standing Committee. After effective discussion and deliberation with stakeholders, a report on July 13, 2022 was presented by the committee. Subsequently, the 2023 Mediation Bill was introduced after the Cabinet approved changes to the 2021 Bill.

The new legislation received approval in both houses of Parliament, with the Rajya Sabha passing it on 1 st August, 2023, further leading to approval in the Lok Sabha on 6 th August, 2023. This act represents a progressive step towards amicable dispute resolution, emphasizing speed, cost-effectiveness, voluntariness, and transparency. Compared to disputes resolved through traditional court proceedings, alternative dispute resolution mechanisms, such as mediation, offer a swifter, more affordable, and mutually satisfactory resolution. 

Mediators, neutral individuals overseeing the process, play a pivotal role in patiently addressing both parties claims to facilitate a solution that minimizes the risk of future
disputes. Distinguished from arbitration, Section 19 of the new Mediation Bill clarifies that a mediator cannot act as an arbitrator or represent parties in any subsequent legal proceedings related to the mediated dispute.

This act, with its eleven chapters and ten schedules, stands as an effective tool for parties seeking an enduring resolution to disputes, acknowledging the power of collaboration, dialogue, reconciliation, and problem-solving in the mediation process.

An Analysis

Section 3(i) (3) of the Mediation Act, 2023 defines who a mediator is. The definition states “includes a person registered as mediator with the Council”. Through this, it can be
interpreted that both registered and unregistered mediators are present, which creates an ambiguity if both are considered valid or not. There are still a lot of gaps that need to be filled as to how the mediation, i.e., the procedure, would take place in the case of “international mediation”, as mentioned under Section 2(iii). The First Schedule, which is in reference to Section 6 (4) of this act, mentions that minors and persons with intellectual disability are not fit for mediation. The Guardians and Wards Act, 1890 (5) and National Trust Act, 1999 6 provide guardians to all the aforementioned and therefore excluding them from mediation rather leads to lacuna in this act leading to more
tribulation for them.

Under Section 12A (7) , before filing a lawsuit that doesn’t involve “contemplate any urgent interim relief” under this Act, the plaintiff must complete the “pre-litigation mediation” process as per the rules prescribed by the Central Government. “Contemplate any Urgent Interim Relief” has also been mentioned in Section 12A (8) of “The Commercial Courts Act 2015” (9). The Supreme Court in the case “Patil Automation Private Limited Vs. Rakheja Engineers Private Limited” (10) held the following:

“The word contemplate is that there can be attempts to bypass the statutory mediation Under Section 12A by contending that the Plaintiff is contemplating urgent interim relief, which in reality, it is found to be without any basis. Section 80(2) of the Code of Civil Procedure permits the suit to be filed where urgent interim relief is sought by seeking the leave of the on 80(2) contemplates that the court shall, if, after hearing the parties, is satisfied that no urgent or immediate relief need be granted in the suit, return the plaint for presentation to the court after compliance. Our attention is drawn to the fact that Section 12A does not contemplate such a procedure. This is a matter which may engage the attention of the lawmaker” (11).

The use of the term “contemplate” in Section 12A (12) raises concerns about potential attempts to circumvent statutory mediation by falsely claiming the need for urgent relief. Unlike Section 80(2) of the “Civil Procedure Code” (13) , Section 12A lacks a provision for court discretion on urgent relief, prompting consideration of legislative clarification on this procedural divergence. Section 30(1) of this act states that “online mediation may be conducted” if both parties agree to it and give written consent, which makes mediation more convenient to use leading to an increase in the use of this particular ADR. But Section 30(2) states: “The process of online mediation shall be in such manner as may be specified.”

This introduces ambiguity by not providing specific details or guidelines regarding the process of online mediation. It leaves room for interpretation and raises questions about the procedural specifics, technological requirements, and overall framework for conducting online mediation, requiring further clarification through specified rules or guidelines. 

Section 32 (14) of this act mentions the members required to be present in the Mediation Council, which are seven in number. The requirement for the Chairperson to be a person of ability, integrity, and standing with adequate knowledge and professional experience in law, alternative dispute resolution, public affairs, or administration ensures effective leadership at the helm of the council as mentioned under Section 32(a) which shows that the decision by the council would be beneficial. Section 32(b) and section 32(c) also mention the necessary condition of having experience in the field of alternative dispute resolution. Section 55 (15) of this act is for advantage for the parties in mediation, for sensitive cases like family relations under “The Maintenance and Welfare of Parents and Senior Citizens Act, 2007”, and “Family Courts Act, 1984” which are not just contractual but also emotionally related, therefore keeping the result according to mediation is more desirable rather than going through the regressive traditional laws. But if we see the case of sexual harassment under the “Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013,” it states that this could be solved through the medium of mediationwhereas “sexual harassment” has been considered as a cognizable offense.

Lastly, the 10th Schedule of this act clearly states that the Consumer Protection Forum has no authority or power, which contradicts the eight schedules that mention the “Companies Act Tribunals” (16) .

Community Mediation: Focus on Family Mediation

In addition to Section 55 (17) of this act for familial disputes, another option is “Community mediation” which is mentioned in Chapter X as one of the new provisions in the law. Although the community of interest has not been defined in this act, the procedure has been defined under Section 43, the circumstances under which this kind of mediation would take place is when there is “dispute likely to affect peace, harmony and tranquillity amongst the residents or families” (18) mandating the consent of disputing parties for mediation, directing them to apply to relevant authorities. The authorities then establish a panel of three community mediators, considering individuals with integrity, local recognition, mediation experience, and any person deemed to be appropriate.

Section 44 (19) details the mediation process, emphasizing the mediator’s role in devising suitable procedures and facilitating amicable resolutions. Settlement agreements are
documented and provided to parties, with non-settlement reports submitted as necessary. This provision gives an opportunity to solve family disputes with more efficiency, curbing cutting off blood relations over minor disputes. Around 76% of litigation is related to property and family disputes (20). In 2022, around eleven lakh cases were pending in the Family Courts, and only around 700 courts were present in India (21). Through this act, the family members could transfer their case to a mediation cell where the dispute could be solved more easily and smoothly. Retired Supreme Court Judge Kurian Joseph estimates that around 50% of family dispute cases can be solved through mediation in the civil side rather than being forced to go through the legal system for decades. If today High court has special power to quash FIR against cases of women cruelty because the family prefers outside settlement, would not small menial disputes be more preferred be solved by mediation rather than “Court Kutchery”.

As per Section 44(1), (22) there is going to be the presence of three mediators, meaning the decision would be neutral; therefore, the probability of arriving at a conclusive settlement is increased, but Section 44(4) (23) states that it would not be binding on the parties, this has both pros and cons. The pros are that rather than forcefully enforce a decision, it would rather focus on resolving issues, making it possible for the family to revive its harmony and be mutually satisfied with the decision. But the other side of the coin is that it would lead to null enforcement meaning that it might not be considered to opt in because after all they still can go to court, which leads to square one and addition of cases in 4.7 crore already existing cases.

Conclusion

In conclusion, the Mediation Act of 2023 represents a significant milestone in the legal landscape of India, addressing the urgent need for a comprehensive framework governing alternative dispute resolution, specifically focusing on mediation. While the act introduces commendable features like the setting up of the Mediation Council, provisions for online mediation, and an emphasis on confidentiality and time limits, it is not without its challenges. The ambiguity surrounding the validity of both registered and unregistered mediators, procedural gaps in international mediation, and the exclusion of certain categories like minors and persons with intellectual disabilities present notable shortcomings. Concerns arise regarding potential misuse, distinctions between registered and unregistered mediators, and the exclusion of specific disputes.

Though Chapter X’s introduction of community mediation offers a compelling approach to resolving family disputes while prioritizing peace and harmony, seeking broader insights into alternative dispute resolution’s efficacy and its impact on familial and societal dynamics. Despite these challenges, the act’s emphasis on amicable dispute resolution, confidentiality, and enforcement mechanisms offers promising potential. Addressing these concerns would be crucial for effectively implementing mediation in India. Proposing phased implementation, reducing time frames, investing in capacity building, and providing clear guidelines for online mediation and enforcement of community mediation to a certain extent are essential steps forward. As India navigates the opportunities and challenges of alternative dispute resolution, the Mediation Act of 2023 lays a foundation for transformative change, fostering collaboration, dialogue, and reconciliation in dispute resolution.

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