EDITED BY – KIRTEE KAMAL DAS

LLB 3rd SEMESTER (2022 batch)

UNIVERSITY LAW COLLEGE, GAUHATI UNIVERSITY

2019

ALTERNATIVE DISPUTE RESOLUTION

Paper: 3.5

Full Marks: 80

Time: Three hours

The figures in the margin indicate full marks for the questions .
1. Fill in the blanks with appropriate answer: : 1x10=10

(a) Alternate Dispute Resolution tries to achieve the Directive Principles of State
Policy relating to Equal justice and Free Legal Aid as laid down under Article
__________ of the Constitution.
(39/39-A)

Ans: Article 39-A

(b) The Legal Services Authorities Act, 1987 brought about the establishment of
__________ for settlement of disputes cheaply and expeditiously and also in the
spirit of compromise by give and take formula. (Lok Adalat System / ADR System)

Ans: ADR System

(c) Section 30 of the Arbitration and Conciliation Act, 1996 encourages arbitrators,
with the agreement of the parties, to use mediation, conciliation or other
procedures at any time during - the arbitration proceedings to encourage
settlement __________ (30/32-A)

Ans: Section 30
(d) The Limitation Act, 1963 (36 of 1963) ___________ apply to arbitrations as it
applies to proceedings in court. (shall not /shall)

Ans: Shall

(e) Under section 10, Arbitration and Conciliation Act, 1996, the parties are free to
determine the number of arbitrators, provided that such number _________
(does not exceed three / is not an even number)

Ans: Is not an even number

2. Write short answers: 2x5=10

(a) Appointment of Arbitrator.

Ans: The appointment of arbitrators comprises the process whereby arbitrators

are appointed to adjudicate over a legal dispute If within 30 days after receipt by
a party of a proposal, the parties have not reached an agreement on the choice of
a sole arbitrator, the sole arbitrator shall be appointed by the appointing
authority agreed upon by the parties.

(b) What is Mediation?

Ans: Mediation involves the intervention of a third person, or mediator, into a

dispute to assist the parties in negotiating jointly acceptable resolution of issues
in conflict. The mediator meets with the parties at a neutral location where the
parties can discuss the dispute and explore a variety of solutions

(c) What do you mean by 'Pure Legal Process

Ans: ADR stands for Alternative Dispute Resolution, and it refers to methods of
resolving disputes outside of the traditional court system. The pure legal process
in ADR is typically not as formal as the court process and may include various
methods such as mediation, arbitration, and negotiation.
(d) ADR provision under the relevant provisions of the Indian Contract Act,
1872.

Ans: According to Section 28 of the Indian Contract Act, any agreement that
prevents or restricts an aggrieved party from seeking remedy in a relevant court
or tribunal in the case of a breach of contract is null and void.

(e) ADR provisions under Art. 298 and Art. 299 of the Constitution of India.

Ans: Article 298 expressly provides that the executive power of the Union and of
each State shall extend to the carrying on of any trade or business and the
acquisition, holding and disposal of property and the making of contracts for any
purpose. Article 299(1) prescribes the mode or manner of execution of such
contracts.

3. Explain the significance of the UNCITRAL Model Law, 1985 in the growth and
development of the international commercial arbitration. 15

Ans: Introduction

With the advent of globalization and industrialization, the world has been
interacting with each other more than anything and this has led to great and
successful partnerships amongst people and businesses from different parts of
the globe. The opening of the world market has created the need to adopt an
alternate mechanism for dispute resolution among the participating partners. The
domestic courts were unable to stabilize the increasing number of conflicts and
disputes that had to be resolved on the international platform speedily and
effectively as quickly as possible. This led to the formation of arbitration, as a
form of Alternative Dispute Resolution (hereinafter referred to as the ADR) to
resolve disparity among the states and countries concerning the rules and
procedures regulating the process and the standards expected by the disputing
parties. Concerning this, the United Nations Commission on International Trade
Law (UNCITRAL) adopted the Model Law on International Commercial Arbitration
on 21st June 1985.
THE UNCITRAL MODEL LAW ON INTERNATIONAL COMMERCIAL ARBITRATION

The UNCITRAL is the essential legal body of the United Nations in the area of
international trade law. It was established by the United Nations General
Assembly after the realization that differences in national laws governing
international trade are creating hurdles to the free flow of trade. Hence, this
commission was established with the view to play an active role in reducing or
removing these hurdles. The UNCITRAL Model law has been designated to assist
the states to establish their domestic law and modernize their laws on arbitral
procedure with due consideration of the specific features and the needs of
international commercial arbitration. It highlights worldwide consensus on the
key aspects of international arbitration practices adopted by states, of different
parts of the states and different legal or economic systems of the world. The
Model Law comprises 8 chapters, 36 Articles and is to be adopted by different
nations into their national laws or to adapt their national laws of arbitration based
on the principles of this model law.

Salient features

Some features of the Model Law are as follows:

 It lays down certain rules and provisions intending to create uniformity in

international commercial arbitration.
 Article 1 of the Model Law states the substantive part of international
commercial arbitration which defines arbitration as international if while
concluding the arbitration agreement, the parties’ place of business were in
different States or one of the places is located outside the state in which
the party of the agreement have their place of business:
 Or the place where the commercial relationship has been performed.
 Or where the subject matter of the dispute has occurred.
 Or the parties to the arbitration agreement have jointly agreed to include
more than one place for the subject matter of the agreement.
 It reflects the composition of an arbitral tribunal and the enforceability
provision of an arbitral award. It would be enacted in a State if the seat of
arbitration is within the territory of the particular State and the arbitral
award would have global enforcement. However, the principle of ‘party
autonomy’ proclaims the parties in a dispute to independently choose laws
to conduct the arbitration process.
 It limits the interference of the court in the process of arbitration, thereby
only allowing judicial intervention for the appointment of arbitrators,
challenge and termination of an arbitrator, jurisdiction of an arbitral
tribunal, and the setting aside of an arbitral award. Moreover, it allows
court assistance in recording evidence, recognition of the arbitration
agreements and enforcement of the arbitration awards.
 It highlights the essence of the arbitration clause or agreement that must
be present if parties to a dispute choose arbitration as a means to solve
their dispute. The Model Law also states the matter of the clause and gives
recognition to these clauses even through the judiciary.
 Concerning the arbitral tribunals, it states the number, appointment,
procedure of the arbitration, thereby safeguarding the freedom of the
tribunal and the will of the parties.
 It sets out the rules to be followed for the pronouncement of the award,
the enforcement of the award, and the grounds for challenging the award.

Case laws

The Model Law does not state any fixed definition for the term ‘commercial’,
hence it connotes a wide interpretation and changes with the judicial decision.
The term should be broadly constructed as it forms the main part of international
trade all around the world. In the case of R.M. Investments and Trading Co. v.
Boeing Co. (1994), the Supreme Court of India interpreted the term ‘commercial’
to include all ‘commercial relationships’ in support of relationships consisting of
family, cultural, social, economic or political nature. The court, in this case, stated
that the contract for a consultancy service is included within the ambit of
‘commercial’ and therefore, the arbitration clause in the contract should be
applied.
Conclusion

About the growing relevance of arbitration in resolving international disputes

between the international and national parties, it is appropriate that arbitral
tribunals must be empowered concerning grant interim measures of protection.
However, the Model Law (2006) amended was not clear but the intent of the
Indian legislation in this regard is laudable.

Or

Discuss the procedure for conduct of arbitral proceeding. What are the powers
of an arbitral tribunal to proceed ex parte? Answer with the help of a case law.
6+9=15

Ans: Introduction

In recent times, the arbitration process has become a powerful tool to bring
business disputes to an end. The Arbitration and Conciliation Act, 1996
(hereinafter referred to as “the Act”) was enacted to consolidate, codify and
amend the laws pertaining to domestic as well as international commercial
arbitration and enforcement of foreign awards. The Act also codified laws related
to conciliation and connected matters. The Act ensures party autonomy and
confidentiality in the matters of arbitration.

Arbitration Agreement

The requirements of an arbitration agreement are provided under Section 7 of

the Act. The arbitration agreement must be in writing and duly signed by the
parties. The arbitration agreement can be in the form of an arbitration clause in a
contract or in the form of a separate agreement.

Appointment of arbitrators

One of the advantages of arbitration is that it allows parties to an arbitration

agreement to submit a dispute to judges of their own choice. Under Section 10 of
the Act, the parties are free to determine any odd number of arbitrators. In cases
where the parties fail to determine the number of arbitrators, the arbitral tribunal
shall consist of a sole arbitrator.

Arbitration Proceedings

Section 21 of the Act provides the rules which govern the commencement of
arbitral proceedings. It gives freedom to the parties to agree and determine when
the arbitration proceeding can officially commence. But in the absence of such an
agreement or where the parties fail to arrive at an agreement, the arbitral
proceedings can commence when one party issues a notice to the other party, in
writing, showing its intention to refer the dispute to arbitration.

Equal Treatment of Parties (Section 18)

Section 18 of the Act has two fundamental principles. Firstly, it provides that the
parties to an arbitration proceeding shall be treated with equality and secondly,
that each party shall be given a full opportunity to present their case. This section
is a mandatory provision and the arbitral tribunal has to comply with it. The
tribunal has to act in an impartial manner to the parties and no party has to be
given an advantage over the other.

Procedure of Arbitral Proceedings (Section 19)

Section 19 of the Act recognises the right of the parties to agree on the
procedural rules which are applicable in conducting the arbitral proceedings. This
provision establishes the procedural autonomy of the parties.

When the parties fail to agree on a procedure or frame the procedure, it grants
the arbitral tribunal a wide range of discretionary powers to frame the arbitral
proceedings. The Act does not prescribe any default rules regulating the arbitral
proceedings.

Place of Arbitration (Section 20)

Section 20 of the Act provides that the parties are free to agree on the place of
arbitration and if they fail to agree then the arbitral tribunal has to determine the
place of arbitration in a judicial manner, considering the circumstances of the case
and convenience of the parties.

Language to be used in Arbitral Proceedings (Section 22)

Section 22 of the Act deals with the language which has to be used in arbitral
proceedings. The parties to the arbitration agreement are free to choose the
language or languages which have to be used in the arbitral proceedings. In cases
where the parties fail to arrive at such an agreement then it is the role of the
arbitral tribunal to determine the language or languages to be used in the arbitral
proceedings. The language shall also apply to any written statement by a party,
any hearing and any arbitral award, decision or other communication by the
arbitral tribunal.

Statement of Claim and Defence (Section 23)

Section 23 of the Act provides for pleadings of the parties before the arbitral
tribunal. After the arbitral tribunal has been established, the usual practice is to
exchange and file their pleadings before the tribunal.

The claimant states the facts and other relevant matters, while the respondent
opposes the facts and the averments made in the claim statement and contests
the relief claimed by the claimant. The contents of pleading may vary from case to
case depending upon the facts and circumstances of each case.

Within six months of the appointment of the arbitral tribunal, the statement of
claim and defence has to be completed under this section.

Hearing and written proceedings (Section 24)

Section 24 of the Act discusses the manner in which arbitral proceedings are to be
conducted. In the absence of any prior agreement between the parties relating to
this matter, the arbitral tribunal has the power to decide whether the
proceedings shall be held orally or on the basis of documents and other materials.

Default of Party (Section 25)

Section 25 of the Act deals with three situations where the parties are at default.
Firstly, the arbitral tribunal terminates the proceedings when the claimant
without showing sufficient cause, fails to communicate his statement of claim in
accordance with Section 23(1). Secondly, the arbitral tribunal continues the
proceeding when the respondent fails to communicate his statement of defence
in accordance with Section 23(1).

Thirdly, if there is sufficient cause then the termination is recalled and proceeding
gets restored.

Appointment of Experts (Section 26)

Section 26 of the Act gives the arbitral tribunal power to appoint one or more
experts based on the requirement or request of the parties. It requires the parties
to provide relevant information to the experts. Also, the arbitral tribunal cannot
appoint experts and delegate the duty of determination of the dispute.

Court Assistance

Section 27 of the Act provides the arbitral tribunal with the power to apply for the
court assistance in taking evidence. Persons can also be held guilty and tried
before the court, if they refuse to give evidence or do not cooperate.

Termination

The arbitral proceedings are terminated either by the final arbitral award or by an
order of the arbitral tribunal terminating the arbitral proceedings. The arbitral
tribunal terminates the arbitral proceedings in any of these cases where: the
claimant withdraws the claim and respondent does not object to it, both parties
are in consensus and agree to terminate the arbitral proceedings, or the
continuation of the arbitral proceedings has become impossible or irrelevant
considering the present facts of the case.

Power to proceed ex-parte

Where without stating sufficient cause, under Section 25 of the Act, the claimant
or respondent fails to communicate his statement of claim or defence under sub-
section (1) of Section 23 of the Act the arbitral tribunal shall proceed ex-parte.
Ex Parte Proceedings In Arbitration

Section 25 in The Arbitration and Conciliation Act, 1996

Default of a party-

The arbitration tribunal has the power to proceed ex parte (an order which is
given in absence of one of the parties caused on their own will) if any of the
following conditions arise- the claimant fails to communicate his statement of
claim in accordance with section 23, the arbitral tribunal shall terminate the
proceedings; the respondent fails to communicate his statement of defence in
accordance with section 23, the arbitral tribunal shall continue the proceedings
without treating that failure in itself as an admission of the allegations by the
claimant; a party fails to appear at an oral hearing or to produce documentary
evidence, the arbitral tribunal may continue the proceedings and make the
arbitral award on the evidence before it.

Section 25 of the Act- The provision of section 25 make it clear the arbitrator may
pass order ex parte in the absence of any of the parties to arbitration. Before
passing ex parte order, it is the duty of the arbitrator to inform the parties
concerned about his intention to proceed with the case of ex parte.

Arbitrator Power to Proceed: Where a party did not appear on the adjourned
date in spite of a note by the arbitrator in the minutes of the hearing that if the
party doesn’t appear on the appointed date and time, the hearing would proceed
ex parte and no separate notice is given, the ex parte award, in such a case is legal
has been stated in case of Nagasirinivasulu vs. GLADA Finance Ltd. (2009). A
party who, though repeatedly written to, doesn’t appear before the arbitrator
and allows the proceedings to go ex parte, cannot later on say that he was not
given the opportunity of being heard.

If a party shows sufficient cause for his non-appearance before the arbitrator, the
court will set aside the award passed ex-parte as stated in case of H.C.
Whitehouse vs. Kahn Kahn and Co. (1914). In the case of State of U.P. vs.
Combined Chemicals (2011), the appellant sought adjournment on the ground
that he had filed an appeal against the order of the trial court on the question of
maintainability of petition, the arbitrator granted adjournment but the appellant
failed to obtain stay order from the appellant court and continued to abstain from
the arbitral proceedings, it was held that the arbitrator was justified in proceeding
ex parte against such party.

In the case of Mordue vs. Parmer (1871), it was held that an arbitrator having
signed his award is functus officio and cannot alter his award and cannot alter the
slightest error in it, even though such error has arisen from the mistake of a clerk
in copying the draft. The proper course in such was to obtain an order to refer the
award back to the arbitrator.

Conclusion

The arbitral proceeding is based completely on the concept of party autonomy,

where both the parties decide the procedure as well as the circumstances under
which arbitration is sought. The “rules of the game”, such as applicable law, the
seat of arbitration, the language of the proceedings, etc. are in the hands of the
parties and the arbitral proceedings are mostly conducted based on those rules.
So, there are no particular set of rules and applicable laws which govern the
arbitral proceedings. However, Arbitration and Conciliation Act, 1996 limits
judicial intervention and reinforces the importance to party autonomy,
confidentiality and expeditious completion of arbitral proceedings.

4. Discuss the salient features of the New York Convention and Geneva
Convention Awards. 8+7=15

Ans: The New York Convention

The New York convention also known as the Convention on the Recognition and
Enforcement of Foreign Arbitral Awards was first adopted by the United Nations
diplomatic conference on 10 June 1958 and was enforced on 7 June 1959. It is often
considered as one of the most important treaties in the field of international trade
law and has a great significance. It is often described as a foundation stone in the
field of international arbitration. It requires courts of the contracting states to give
effect to an agreement to arbitrate when seized of an action in a matter covered
by an arbitration agreement and also to recognize and enforce awards made in
other states, subject to specific limited exceptions. At present, the convention is
signed by 156 state parties.

It was adopted mainly for promoting healthy business relations between the
countries and to promote harmony and coordination among the states. Further it
reduces the burden of the states to decide which laws to be enforced or the
procedures of which countries to be followed during the process of the arbitration.
Further it also establishes a minimum level of control which the contracting states
can exert over arbitral awards and arbitral agreements. The two main actions which
were taken by the New York convention are as follows:

 Recognition and Enforcement of Foreign Arbitral Award

The first action is to recognize the awards made in the foreign territory and is
defined under the Article 1 of the convention. It is the obligation of the states to
recognize such awards and enforce them according to the Article 3 of the
convention. The state who wants to seek the foreign arbitral award needs to submit
the following documents before the court and it lies upon the interpretation of the
court to decide that it falls under the scope of the convention or not. A state which
needs to seek the enforcement needs to submit the following documents.

 The Arbitral Award

The arbitral document according to the article 4 of the convention

The state against whom the convention is enforced can object to the enforcement
by submitting the proof of even one grounds of refusal of the enforcement which
are mentioned in the Article 5 of the constitution. Now it lies on the discretion of
the courts to enforce an award or not based on the paragraph 2 of the article 5 of
the enforcement.

 Referral to the Court by the method of Arbitration

Article II, paragraph 3, provides that a court of a Contracting State, when seized of
a matter in respect of which the parties have made an arbitration agreement, must,
at the request of one of the parties, refer them to arbitration.

The Key features of the New York Convention

 It creates a uniform international framework which enables various

countries to establish strong trade and commercial relations and solve
disputes with the help of arbitration. It achieves this by firstly requiring the
signatory states to enforce the awards rendered in the signatory state and
secondly by limiting the grounds on which the states may refuse recognition
and enforcement.
 The states who are a party to this convention are required to bind to the
foreign awards and enforce them according to the rules and procedures
established by the New York Convention.
 The procedure is free from any complex procedures and charges. The states
just need to submit to a competent court in the contracting state where the
enforcement is sought.

Geneva Convention Award

Henry Dunant was a rich man from Geneva, Switzerland. Once for the expansion of
his business, he reached the town called Solferino, Italy. In 1958, he found that the
war was going between Italy, France, and Austria, and that war was called the
Battle of Solferino. This battle led to the casualty of over 40,000 soldiers, of which
23000 were from Austria, and Austria lost the battle. After Accentuating all this in
Italy, he was expedient, and without any discrimination between Italy, France, and
Austria, he wanted to help them and initiated people to help who are not well or
injured.

Dunant observed that Austrian soldiers who were injured and disabled were killed
in Italy. Moved by the plight of the wounded, he wanted to help them out, and
people who witnessed his work were touched by his gesture and joined it.
At this time, the phrase Tutti-Fratelli was very much used, and this phrase means
that we all are brothers after returning to Switzerland; he wrote a book named
Memory of Solferino in his book, he just not only shared his experience that at the
time of war the loss which was faced by both of the countries whatever the country
is facing and feeling and whichever country wins the war or who so has lost the war
the country always feels bad about the warriors they have lost.

Dunant gave suggestions in his book. In his book, he also suggested prepositions,
and the first preposition which he told was: -

 Voluntarily relief society here Dunant meant to say that every country should
make a voluntary relief society who without discrimination, help the injured
people.

Also, at an international level, we should make an agreement that lays down

principal to be followed during the time of war.

Dunant shared his book with all the leading European political and military leaders,
and he received a positive reply from all of them; in the years 1963 to discuss the
suggestions of Dunant books, a world meeting was called, and this meeting leads
with two objectives, for humanitarian aid, there must be:-

Creation of a permanent relief agency or government relief agency.

An international treaty to allow a neutral third party to provide aid in a war zone
and that party should not be threatened by any means. To fulfill the first objective,
the International Committee of the Red Cross was formed, and 12 countries came
together and signed an agreement, and for the fulfillment of his proposed second
objective on 26th August 1864, the 1st Geneva Convention was formed. For the
formation of both of the organizations, Henry Dunant was awarded the first Nobel
Peace Prize.

The 1st Geneva Convention was made in 1864, which states that at the time of war,
conditions of the wounded and the sick in the armed forces in the field, how will
they be treated, and on which condition they should be kept. The wounded
shoulders should not be tortured and should not be given unnecessary pain.
If the opponent gets injured, it’s their duty to fight the battle and must provide
proper medical facilities. Anyone who, through religion, is involved in war should
not be captured. In 1906 2nd Geneva Convention was held, which states the
protection of the wounded, the sick, and the Shipwrecked Military Personnel at
Seas.

Arbitration Award and International Award

An arbitration award is the award granted by the arbitrator in their decision. This
award can be money one party has to pay to the other party. It can also be a non-
financial award, such as stopping a certain business practice or adding an
employment incentive. In simpler words, arbitral awards refer to the decision of an
arbitral tribunal, whether in a domestic or international arbitration.

Essentials of an arbitral award

For an arbitral award to be valid it must contain the following essential elements:

 The award shall be in writing.

 The award shall be signed by all the members of the arbitral tribunal.
 The award shall state the reasoning on which it is based.
 Date and place of arbitration should be mentioned on the award.

Arbitral awards include interim awards

Domestic awards are governed by Part I whereas foreign awards are governed by
part II of the Arbitration and Conciliation Act of India. A domestic award is an award
passed under the provisions of Section 2 to 43 of the Act.

A domestic award is a result of domestic arbitration; hence it confines itself to the

territory of India, the parties should have a nexus or birth to Indian origin, basically
territory comes into play in order to asses a domestic arbitration. Award given by
an arbitral institution in India or an award even if given by a foreign state for a
dispute where both the parties are of an Indian origin and the nationality is also
governed by the Indian laws shall also come within the purview of domestic
arbitration.
A Foreign award as per section 44 means an arbitral award which relates to
differences relating to the matters considered as commercial under the law in force
in India.

Or

What are the various modes of Alternative Dispute Resolutions (ADR)?

Distinguish between an 'arbitral award' and international arbitral award'.

7+8=15

Ans: Introduction

Indian judiciary is one of the oldest judicial system, a world-renowned fact but
nowadays it is also well-known fact that Indian judiciary is becoming inefficient to
deal with pending cases, Indian courts are clogged with long unsettled cases. The
scenario is that even after setting up more than a thousand fast track Courts that
already settled millions of cases the problem is far from being solved as pending
cases are still piling up.

To deal with such a situation Alternative Dispute Resolution (ADR) can be helpful
mechanism, it resolves conflict in a peaceful manner where the outcome is
accepted by both the parties.

Alternative Dispute Resolution

The concept of Alternative Dispute Resolution (ADR) mechanism is capable of

providing a substitute to the conventional methods of resolving disputes. ADR
offers to resolve all type of matters including civil, commercial, industrial and
family etc., where people are not being able to start any type of negotiation and
reach the settlement. Generally, ADR uses neutral third party who helps the
parties to communicate, discuss the differences and resolve the dispute. It is a
method which enables individuals and group to maintain co-operation, social
order and provides opportunity to reduce hostility.

Various modes of Alternative Dispute Resolution

 Arbitration

The process of Arbitration cannot exist without valid arbitration agreement prior
to the emergence of dispute. In this technique of resolution parties refer their
dispute to one or more persons called arbitrators. Decision of arbitrator is bound
on parties and their decision is called ‘Award’. The object of Arbitration is to
obtain fair settlement of dispute outside of court without necessary delay and
expense.

Any party to a contract where arbitration clause is there, can invoke arbitration
clause either himself or through their authorized agent which refer the dispute
directly to the arbitration as per the Arbitration clause. Here, arbitration clause
means a clause that mention the course of actions, language, number of
arbitrators, seat or legal place of the arbitration to be taken place in the event of
dispute arising out between the parties.

 Mediation

Mediation is an Alternative Dispute resolution where a third neutral party aims to

assist two or more disputants in reaching agreement. It is an easy and
uncomplicated party centered negotiation process where third party acts as a
mediator to resolve dispute amicably by using appropriate communication and
negotiation techniques. This process is totally controlled by the parties.
Mediator’s work is just to facilitate the parties to reach settlement of their
dispute. Mediator doesn’t impose his views and make no decision about what a
fair settlement should be.

 Conciliation

Conciliation is a form of arbitration, but it is less formal in nature. It is the process

of facilitating an amicable resolution between the parties, whereby the parties to
the dispute use conciliator who meets with the parties separately to settle their
dispute. Conciliator meet separately to lower the tension between parties,
improving communication, interpreting issue to bring about a negotiated
settlement There is no need of prior agreement and cannot be forced on party
who is not intending for conciliation. It is different from arbitration in that way.

 Negotiation

In India, negotiations don’t have statutory recognition. There is no particular

statute for negotiation as a mode of ADR. It is rather a form of self-counselling
between the parties to resolve the dispute at hand. It is the simplest means for
the redressal of disputes. The parties begin by talking to each other without the
interference of a third party. Negotiation acts as a dialogue that is intended to
resolve the dispute and produce an agreement to bring out the cause of action
and bargain for collective advantage

Conclusion

There are various modes of ADR systems that exist, but we have mainly discussed
the differences between conciliation and negotiation. Both methods are unique in
their own way and can be used as per the parties’ requirements. It varies from
dispute to dispute which method shall be used for resolving it. These methods
aim to provide diverse techniques that can be used to help parties amicably
resolve the dispute.

5. Discuss the organization, powers and cognizance of the Lok Adalats established
under the Legal Services Authorities Act, 1987. Explain the advantages and
disadvantages of Lok Adalats. 10+5=15

Ans: Introduction

Conflicts and disputes lead to consumption of capital, valuable time, effort etc. It
is very important and significant that conflict must not arise in society. But that is
near to impossible as people live together in a society and there is the possibility
of conflicts and disputes arising between them. So, the solution to this problem is
that when any conflict arises its head, it must be nipped from the bud. In the
majority of the countries, the judicial system is overburdened with many cases.
Any recent case which arises takes a prolonged time to be determined. And in the
meantime, till the judgement regarding the case has been taken, a state of
unpredictability and desolation arises which makes any activity near to
impossible. Since a long duration of time is taken to resolve disputes through
litigation, a number of things get affected like the commerce, development work,
administration, and business.

In order to solve conflicts and disputes without getting involved in lawyers, courts
and litigation majority of the countries rely on supplementary or alternative forms
of dispute resolution. In India, the practice of these methods has been there at
root levels for a long time as tradition and history. These practices are called
panchayat and in legal nomenclature, these are called arbitration. In India, these
are used extensively to resolve both commercial and non-commercial conflicts.
Another alternative method for dispute resolution practised in India is Lok Adalat
technicalities. Also, the use of methods like mediation, conciliation, and
negotiation to resolve the dispute are increasing instead of going for litigation.

Lok Adalat

Lok Adalat is based on the principles by Mahatma Gandhi generally known as

Gandhian Principles. Lok Adalat has been there in India since its ancient times.
Popularly it was called panchayat and in legal nomenclature, it is called
arbitration. Lok Adalat is one of the forms of Alternate Dispute Resolution. Since
in the modern era Lok Adalat gained much popularity as it is cost-effective,
speedy and result giving, it got statutory recognition through Legal services
Authorities Act. Legal Services Authorities Act construct the statutory provisions
in connection to the functioning and organization of Lok Adalat.

The Taluk Legal Service Committee or High Court or the Supreme Court of the
State or District Legal Services Authority can arrange Lok Adalat at specific timings
and places, and it also decides on the jurisdiction for such areas which it thinks fit
upon its own discretion. The NALSA beside legal institutions other than NALSA
conducts Lok Adalat. It was formed under the Legal Services Authorities Act, 1987.
The Act came into force from 9th November 1995 to set up a countrywide
consistent network to give competent and chargeless legal services to the poorer
and feeble sections of the community.
Jurisdiction

Lok Adalat has the authority to decide over cases that are pending in any court or
the matter on which the case is must be falling under the jurisdiction of Lok
Adalat and the case must not have been brought to the court earlier.

Any case which has been brought before a court but the decision regarding the
matter has not been given, can be resolved by Lok Adalat only if both the parties
to the case agree upon resolving the dispute in Lok Adalat or if any one of the
parties apply for appeal in the Lok Adalat to solve the dispute or if the court
deems fit that the matter in the dispute can be solved in Lok Adalat.

A case can be brought before Lok Adalat if it is in the Pretrial stage, where a
request is received from any person involved in the conflict.

Cases related to issues involving marriage, Labour disputes, Acquisition of land,

Divorce, criminal cases, family disputes, bankruptcy cases and other similar cases
can be brought to Lok Adalat.

Nonetheless, Lok Adalat will not have the authority to give judgement over any
case or matter relating to a case that is not covered under any law. In other
words, cases that cannot be covered under any law fall outside Lok Adalat.

Powers

Lok Adalat will have the similar power as a Civil Court have under the Code of Civil
Procedure. Lok Adalat has the alike authority to give judgement as a civil court
has as per the Code of Civil Procedure.

In addition, Lok Adalat will have the necessary power to clarify its decision-making
process for any dispute that comes prior to it.

Whatsoever award is given by the Lok Adalat in a case and whatever decision has
been given by Lok Adalat will have a similar effect as if the award and the decision
is given by any other court or a civil court.
The decision given by Lok Adalat will be final and the award given by it will be
binding on both the parties to the case that has been brought before the Lok
Adalat. An appeal cannot be filed in any court against the release of Lok Adalat.

Benefits of Lok Adalat over Litigation

In Lok Adalat, the dispute settlement takes place outside the court. People mostly
prefer that their matter could be resolved in this kind of settlement. Most people
fear to prefer court litigation not because only of the delay in procedure but also
for the financial burden one has to go through the process. One of the main
reasons for the formation of Lok Adalat was to give fair, equitable and accessible
justice to the financially backward people of our country. Although the
government have taken steps to provide legal aid to the poor, there is the
probability of monetary loss for which many people prefer Lok Adalat.

Family-related cases like accusations of property disputes, matrimonial disputes,

are solved efficiently and faster in Lok Adalat. Though there are family courts for
these matters, people prefer to settle outside the court due to access justice
without consuming a lot of time which is rightly delivered by Lok Adalat. It saves
money and time as well as for the parties it is untroubled to make their claims
which are not the same if the case was in a court. The witnesses also do not want
to involve in legal proceedings and are afraid this will not be a case if the matter
were to be solved in Lok Adalat.

In Lok Adalat there is no Court fee and if a pending case is solved in Lok Adalat
and Lok Adalat give its decision then the fees given to the court earlier will be
refunded.

In Lok Adalat, there is speedy trial, and the procedures are flexible. There is no
stern solicitation of the rules of procedure during the examination of Lok Adalat’s
claim. In Lok Adalat, Parties to the case can give suggestions and advice to the
judge of Lok Adalat. But this is not possible in general regular courts. The decision
taken by the Lok Adalat is final and binding upon the parties. The award given by
Lok Adalat has a similar effect that to any other court or Civil Court. The award
and decision given by the Lok Adalat is non-transferable due to which the dispute
brought to Lok Adalat is resolved without delay of time and effectively.

Judicial recognition of Lok Adalat

The objective of Lok Adalat is to solve cases in a short time, effectively and
efficiently through means of Negotiation, conciliation, and a convincing and
humane approach to solve the problems of opponents.

In a case, High Court ruled that “The provisions of the Legal Services Authorities
Act shall prevail in the matter of an appeal and the appeal shall not be subject to
the provisions of Section 96 CPC. Lok Adalat is made under private law and if this
award is made by Lok Adalat, the right to appeal shall be governed by the
provisions of the Act. Under Section 21(2) of the Legal Services Authorities Act, no
appeal may be lodged with this award under Section 96 CPC. The Court further
stated that” It may also be seen that the Code of Civil Procedure does not provide
for an appeal under a decision under Section 96 against a permit. Such a Court
may not be given permission to be knocked down, chiefly under the Legal Services
Authorities Act, as it would be tantamount to defeat the very purpose of the Act,
and that is why We, therefore, the Appeal stands invalid.

The High Court of Andhra Pradesh in a case held that the award of Lok Adalat is
enforced as a decision and is final. The objective is clearly to bring down the
number of disputes, and a final agreement is reached so that the disputing parties
can no longer continue to pursue cases or any dispute. Although the release of
Lok Adalat is not the outcome of a competency contest as regular litigation by the
Court in a common case by a Court in a recurring case, it is, however, equitable
and consistent with a moderate decision and will have the same binding and
complete effect.

The fact is the decision on the consent is intended to suspend the trial between
the parties as is the case with the decision from the Court’s decision after the
matter was extended to the end.
Conclusion

Lok Adalat has been there in India for ages in form of panchayat and it is there for
a cause. In today’s world where no one has time to even rest, everyone wants
disputes to be solved within a short span of time and effectively. The key to this is
Lok Adalat. Also, in India as a significant part of the population is a poor and
weaker section of the community, they could not afford to get justice through
litigation. Here also Lok Adalat will be a boon and this section of the community
will be able to get justice as it is their right and will be able to uplift this section of
people. In the present world, alternate dispute resolution is very successful, and
Lok Adalat is one of the forms. Though Lok Adalat has certain disadvantages Lok
Adalat is a need in India to provide justice throughout the country.

Or

Briefly outline the evolution of Lok Adalats in India. What is their jurisdiction
under Legal Services Authorities Act, 1986? How Permanent Lok Adalats are
different from ordinary and ad hoc Lok Adalats? 8+3+4=15

Ans: Introduction

Conflicts and disputes lead to consumption of capital, valuable time, effort etc. It
is very important and significant that conflict must not arise in society. But that is
near to impossible as people live together in a society and there is the possibility
of conflicts and disputes arising between them. So, the solution to this problem is
that when any conflict arises its head, it must be nipped from the bud. In the
majority of the countries, the judicial system is overburdened with many cases.
Any recent case which arises takes a prolonged time to be determined. And in the
meantime, till the judgement regarding the case has been taken, a state of
unpredictability and desolation arises which makes any activity near to
impossible. Since a long duration of time is taken to resolve disputes through
litigation, a number of things get affected like the commerce, development work,
administration, and business.

In order to solve conflicts and disputes without getting involved in lawyers, courts
and litigation majority of the countries rely on supplementary or alternative forms
of dispute resolution. In India, the practice of these methods has been there at
root levels for a long time as tradition and history. These practices are called
panchayat and in legal nomenclature, these are called arbitration. In India, these
are used extensively to resolve both commercial and non-commercial conflicts.
Another alternative method for dispute resolution practised in India is Lok Adalat
technicalities. Also, the use of methods like mediation, conciliation, and
negotiation to resolve the dispute are increasing instead of going for litigation.

Lok Adalat

Lok Adalat is based on the principles by Mahatma Gandhi generally known as

Gandhian Principles. Lok Adalat has been there in India since its ancient times.
Popularly it was called panchayat and in legal nomenclature, it is called
arbitration. Lok Adalat is one of the forms of Alternate Dispute Resolution. Since
in the modern era Lok Adalat gained much popularity as it is cost-effective,
speedy and result giving, it got statutory recognition through Legal services
Authorities Act. Legal Services Authorities Act construct the statutory provisions
in connection to the functioning and organization of Lok Adalat.

The Taluk Legal Service Committee or High Court or the Supreme Court of the
State or District Legal Services Authority can arrange Lok Adalat at specific timings
and places, and it also decides on the jurisdiction for such areas which it thinks fit
upon its own discretion. The NALSA beside legal institutions other than NALSA
conducts Lok Adalat. It was formed under the Legal Services Authorities Act, 1987.
The Act came into force from 9th November 1995 to set up a countrywide
consistent network to give competent and chargeless legal services to the poorer
and feeble sections of the community.

Jurisdiction

Lok Adalat has the authority to decide over cases that are pending in any court or
the matter on which the case is must be falling under the jurisdiction of Lok
Adalat and the case must not have been brought to the court earlier.

Any case which has been brought before a court but the decision regarding the
matter has not been given, can be resolved by Lok Adalat only if both the parties
to the case agree upon resolving the dispute in Lok Adalat or if any one of the
parties apply for appeal in the Lok Adalat to solve the dispute or if the court
deems fit that the matter in the dispute can be solved in Lok Adalat.

A case can be brought before Lok Adalat if it is in the Pretrial stage, where a
request is received from any person involved in the conflict.

Cases related to issues involving marriage, Labour disputes, Acquisition of land,

Divorce, criminal cases, family disputes, bankruptcy cases and other similar cases
can be brought to Lok Adalat.

Nonetheless, Lok Adalat will not have the authority to give judgement over any
case or matter relating to a case that is not covered under any law. In other
words, cases that cannot be covered under any law fall outside Lok Adalat.

Powers

Lok Adalat will have the similar power as a Civil Court have under the Code of Civil
Procedure. Lok Adalat has the alike authority to give judgement as a civil court
has as per the Code of Civil Procedure.

In addition, Lok Adalat will have the necessary power to clarify its decision-making
process for any dispute that comes prior to it.

Whatsoever award is given by the Lok Adalat in a case and whatever decision has
been given by Lok Adalat will have a similar effect as if the award and the decision
is given by any other court or a civil court.

The decision given by Lok Adalat will be final and the award given by it will be
binding on both the parties to the case that has been brought before the Lok
Adalat. An appeal cannot be filed in any court against the release of Lok Adalat.

Benefits of Lok Adalat over Litigation

In Lok Adalat, the dispute settlement takes place outside the court. People mostly
prefer that their matter could be resolved in this kind of settlement. Most people
fear to prefer court litigation not because only of the delay in procedure but also
for the financial burden one has to go through the process. One of the main
reasons for the formation of Lok Adalat was to give fair, equitable and accessible
justice to the financially backward people of our country. Although the
government have taken steps to provide legal aid to the poor, there is the
probability of monetary loss for which many people prefer Lok Adalat.

Family-related cases like accusations of property disputes, matrimonial disputes,

are solved efficiently and faster in Lok Adalat. Though there are family courts for
these matters, people prefer to settle outside the court due to access justice
without consuming a lot of time which is rightly delivered by Lok Adalat. It saves
money and time as well as for the parties it is untroubled to make their claims
which are not the same if the case was in a court. The witnesses also do not want
to involve in legal proceedings and are afraid this will not be a case if the matter
were to be solved in Lok Adalat.

In Lok Adalat there is no Court fee and if a pending case is solved in Lok Adalat
and Lok Adalat give its decision then the fees given to the court earlier will be
refunded.

In Lok Adalat, there is speedy trial, and the procedures are flexible. There is no
stern solicitation of the rules of procedure during the examination of Lok Adalat’s
claim. In Lok Adalat, Parties to the case can give suggestions and advice to the
judge of Lok Adalat. But this is not possible in general regular courts. The decision
taken by the Lok Adalat is final and binding upon the parties. The award given by
Lok Adalat has a similar effect that to any other court or Civil Court. The award
and decision given by the Lok Adalat is non-transferable due to which the dispute
brought to Lok Adalat is resolved without delay of time and effectively.

Judicial recognition of Lok Adalat

The objective of Lok Adalat is to solve cases in a short time, effectively and
efficiently through means of Negotiation, conciliation, and a convincing and
humane approach to solve the problems of opponents.

In a case, High Court ruled that “The provisions of the Legal Services Authorities
Act shall prevail in the matter of an appeal and the appeal shall not be subject to
the provisions of Section 96 CPC. Lok Adalat is made under private law and if this
award is made by Lok Adalat, the right to appeal shall be governed by the
provisions of the Act. Under Section 21(2) of the Legal Services Authorities Act, no
appeal may be lodged with this award under Section 96 CPC. The Court further
stated that” It may also be seen that the Code of Civil Procedure does not provide
for an appeal under a decision under Section 96 against a permit. Such a Court
may not be given permission to be knocked down, chiefly under the Legal Services
Authorities Act, as it would be tantamount to defeat the very purpose of the Act,
and that is why We, therefore, the Appeal stands invalid.

The High Court of Andhra Pradesh in a case held that the award of Lok Adalat is
enforced as a decision and is final. The objective is clearly to bring down the
number of disputes, and a final agreement is reached so that the disputing parties
can no longer continue to pursue cases or any dispute. Although the release of
Lok Adalat is not the outcome of a competency contest as regular litigation by the
Court in a common case by a Court in a recurring case, it is, however, equitable
and consistent with a moderate decision and will have the same binding and
complete effect.

The fact is the decision on the consent is intended to suspend the trial between
the parties as is the case with the decision from the Court’s decision after the
matter was extended to the end.

EDITED BY – KIRTEE KAMAL DAS

LLB 3rd SEMESTER (2022 batch)

UNIVERSITY LAW COLLEGE, GAUHATI UNIVERSITY