M J Antony:SC push for ADR

OUT OF COURT

In order to encourage Alternative Dispute Resolution, one suggestion was the government pay for it.

There was a small town where there was only one lawyer. He starved for want of business. Then another came and settled there. Soon there was plenty of litigation to make both of them prosperous. The adversarial system that we follow assured that. But now the trend is towards developing alternative disputes resolution (ADR) mechanisms. Though the lawyers have struck work and unsuccessfully challenged the reforms in the Supreme Court, the apex court has gone forward with the proposed changes.

Early this month, it delivered a 100-page judgement, Salem Advocate Bar Association vs Union of India, dealing with amendments to the Civil Procedure Code (CPC), which strengthens ADR.

When the Supreme Court rejected the constitutional challenge to the amendments to the CPC two years ago, it was noticed in the judgement that modalities have to be formulated for establishing ADR.

Therefore, a committee headed by the chairman of the Law Commission was constituted to ensure that the amendments became effective and resulted in quicker dispensation of justice. Section 89 of CPC, which deals with ADR, was a focus point. The committee has now reported to the Supreme Court and it has given the green signal to implement the recommendations.

Section 89 lists four methods of ADR "" arbitration, conciliation, judicial settlement including settlement through Lok Adalat, and mediation. The first is covered by the Arbitration and Conciliation Act of 1996 and the rules made under it.

The Lok Adalat route is governed by the Legal Services Authority Act 1987. For judicial settlement, the court shall refer the dispute to a suitable institution or person and such person or institution shall be deemed to be a Lok Adalat.

The relevant Act will regulate this process. In the case of mediation, the law says that the court shall effect a compromise between the parties and shall follow such procedure as may be prescribed.

According to the provision, "where it appears to the court that there are elements of a settlement which may be acceptable to the parties," the court shall formulate the terms of settlement and give them to the parties for their response.

The court may reformulate the terms and refer them to one of the four methods of ADR. Then the procedure laid down in Rule 1A, 1B and 1C of the CPC takes over. The high courts can frame detailed rules for ADR.

The committee set up by the Supreme Court has now submitted the final draft of the ADR and Mediation Rules. They set a time frame for each step in the path of the settlement process. Normally it is 30 days. This would reduce the tedium and expense involved in the operation.

The Central and state governments, as well as the public sector undertakings and statutory corporations, shall nominate persons who are authorised to choose the ADR route.

Before directing the parties to choose the method, the court shall give "guidance" to the parties by drawing their attention to the relevant factors.

The court shall advise them that it would be to their advantage, so far as time and expenses are concerned, to opt for ADR rather than seek a full-blown trial.

If none of the parties choose any of the methods despite persuasion, the court shall refer the dispute to the court for proceeding in the regular course.

The draft rules elaborately deal with training of personnel who handle ADR. There shall be training courses for them in appropriate places.

The high courts shall set up a committee of judges and faculty members who are specially qualified in the techniques of ADR. They shall also prepare a manual describing the various settlement methods.

The panel of mediators, for instance, would include retired judges of the Supreme Court, high courts or district courts. Lawyers of 15 years' standing shall also be eligible.

In order to encourage ADR, the committee which drafted the rules suggests that the government should bear the cost of conciliation and mediation.

Describing the idea as laudable, the Supreme Court directed the central government to examine it. If agreeable, it shall request the planning commission and the finance commission to allocate funds for the judiciary to finance the conciliation procedure.

The government, which is stingy when it comes to finance even the regular courts, may put forward excuses to avoid the liability. The infrastructure for training and holding ADR might cause heavy burden on the government.

The legal profession might howl again as mediation et al will bite into their bread. The 30-day pace for the ADR procedure might also be found too fast for a system that relishes induced lethargy.