India Law Journal

It has been rightly said that, ‘It is the spirit and not the form of law that keeps the justice alive’. As per data provided by the Registry of Supreme Court of India, as on 31.10.2006, more than 2, 53, 80,757 cases were pending in our subordinate Courts. The figure of pending adjudication is, indeed, staggering. To deal with these cases, we have less than 15000 judges and judicial officers in the country. The ratio of judge per million population in India is the lowest in the world. This not only indicates the urgent need of more lawyers, judges and courts, but also alternative methods of solving disputes which are more economical and efficient in their working.

Alternative Dispute Resolution (ADR) refers to all those methods of resolving a dispute which are alternatives for litigation in the courts. It is a decision making process to resolve disputes that does not involve litigation or violence. ADR includes arbitration, mediation, conciliation, negotiation, expert determination, early neutral evaluation by a third person, dispute resolution boards .etc.

Conciliation is a well-accepted method of Alternative Dispute Resolution. It is a method by which the parties to a dispute use the services or take the assistance of a neutral and impartial third person or institution, called a conciliator as a means of helping them to reduce the extent of their differences and to arrive at an amicable settlement or agreed solution according to a compromise rather than by law. Conciliation may thus be defined as a non-contentious and non-binding procedure in which an impartial third party, the conciliator, assists the parties by understanding the pros and cons of the respective positions taken by them and help them in reaching a mutually agreed settlement of the dispute. Unlike courts, tribunals and arbitrators, the conciliator does not give a decision; his function is to induce the parties in the dispute to come to a settlement [Commentary on law of Arbitration and Conciliation]

Conciliation is as old as the Indian history. In Mahabharata when both parties were determined to resolve the conflict in battle fields,
Lord Krishna made efforts to resolve the conflict. Now also, the panchayat system works in the villages. The Indian system places a lot of importance on resolution of disputes by negotiation which is purely conciliatory. Conciliation is essentially a consensual process. Under the Arbitration and Conciliation Act, 1996, it has the statutory sanction. The best example where conciliation played an integral role is of the highly politically sensitive case of the Beagle channel dispute over the ownership of certain islands in the entrance to the channel between Chile and Argentina. The mediator was the Vatican. The process was remarkable because it was flexible enough to accommodate the changing political environments in both countries and the mediator used a range of tools to great advantage. This process served to protect a fragile peace between the countries and ultimately allowed them to create an agreement that has lasted until this day.

Mediation is an informal and non-adversial process in which a neutral third person, the mediator, encourages and facilitates the disputing parties to reach a mutually acceptable and voluntary agreement. The mediator is not given any power to impose a settlement. The terms “conciliation” and “mediation” are sometimes used interchangeably because, in both the techniques, a successful completion of the proceedings results in a mutually agreed settlement of dispute between the parties.

A mediator assists the parties to reach an agreement for resolving the dispute and he does not express his opinion on the merits of the dispute, whereas a Conciliator may express an opinion about the merits of the dispute. In both these methods a third party is appointed to assist the parties to reach a settlement of their dispute. A mediator is not given any power to impose a settlement. His function is only to try to break any deadlock and encourage the parties to reach a settlement. In USA, ‘conciliation’ is described as ‘mediation’ in which, it is said that emphasis is, in comparison with conciliation, on more positive role to be played by the neutral in assisting the parties to arrive at an agreed settlement. [Indian Council of Arbitration Journal]

Arbitration is the means by which the parties to a dispute get the conflict settled through the intervention of a third person, but without having recourse to a court of law. It is a mode of settling dispute by referring it to a nominated person who decides the issue in a quasi-judicial manner after hearing both sides. Litigation, on the other hand, is a lawsuit, which implies a legal proceeding in a court or a judicial contest to determine and enforce a legal right.

Jerold S. Auerbach, in his famous book, ‘Justice without Law?’ traces the evolution of Arbitration. According to him, arbitration started as the delegislation reform, to resolve conflict with love and trust, an equitable process based on reciprocal access and trust among community members, expressing ideology of communitarian justice without formal law. The learned author says that an arbitration award is ‘far superior to a black-letter law, declared by judges who discovered it without any exercise of discretion. [A primer on Alternative Dispute Resolution ]

ADR refers to processes other than judicial determination in which an impartial person assists those in a dispute to resolve the issues between them.
Processes can be consensual, advisory, determinative and hybrid.

Any rational disputants shall, in resolving their disputes, make attempts first by means of a consensual process namely negotiation or conciliation/mediation and next when the first attempt fails through an advisory process viz. neutral evaluation followed by adjudicatory process like arbitration or rent-a-judge. They may also try a hybrid process namely min-trial if they find the private judge in the determinative process to be unfair or misbehaving himself.

Conciliation is a first step, and if it fails then the parties resort to arbitration. Thus, conciliation is a precursor to arbitration.

Section 77 of the Arbitration and Conciliation Act, 1996, provides an option to the parties to resort to arbitration or judicial proceedings if they feel a need for the same. Amicable settlement denotes the modes of dispute resolution in which the parties retain their freedom to decide the outcome of their dispute. Amicable settlement is a desirable solution for business disputes and differences. It can occur before or during the litigation or arbitration of a dispute and can often be facilitated through the aid of a third party (the ‘Neutral’) in accordance with simple rules of procedure. It could cover negotiation, mediation and conciliation. Amicable settlement enables the parties to resolve the dispute and bury the past, preserves the present relationship and paves a better future. It involves the following steps:

Bringing the parties to the negotiating table. The parties should come to the negotiation table on their own or on the initiative of the mediator/conciliator. The phrase ‘negotiating table’ means a formal discussion to try and reach an agreement. Therefore, for amicable settlement of their dispute, first of all, the parties should discuss to try and reach an agreement.
Identifying problems. The parties should identify the problems between them. Two points deserve to be mentioned here: One, only those problems that exist between the parties and require to be resolved in order to preserve their relationship should be discussed. Two, those problems should be defined precisely without giving any room for vagueness and ambiguity.
Establishing facts. The facts should be established. That is to say, all the facts relevant to the case for which solution is being tried should be ascertained. Fact, means and includes anything, state of things or relation of things, capable of being perceived by the senses; any mental condition of which any person is conscious.
Clarifying the issues. The issues which shape into the disputes should be clarified. The disputes may relate to clarity of matters such as money matters, professional status, reputation, health and so on involving variegated issues. An issue arises when a material proposition of fact or law is affirmed by one party and denied by the other. Material propositions are those of law or fact which the claimant may allege in order to show a right to claim or which a defendant must allege in order to constitute his defense. Issues of fact may arise from the credibility of the parties themselves or from data supplied by third parties, including interpretations placed on such data and issues of law will generally arise from opinions given by respective legal representatives. Issues, both of law and fact should clarify before developing the option for settlement.
Developing the options for settlement. The mediator/conciliator opens to the disputing parties a variety of available options besides those they can think of themselves. By promoting their attitudes and discovering in what fields they may be prepared to show some flexibility, he gains a perspective of the issues in dispute and of alternative possibilities of settlement. These options may vary in number according to the nature of the issues involved; and they may be available in respect of a single issue or a combination of issues.
Ultimately reaching agreement. The mediator/conciliator should not himself make a proposal for settlement of the dispute unless he has exhausted all possibilities of obtaining a settlement on the basis of the parties proposed solutions. If the dispute involves a number of issues, his proposal should be for a “package” settlement that will dispose of all such issues. He should not formally make his proposal at a joint meeting without having first obtained the agreement of each of the parties separately.

If it is not possible to obtain agreement on the issues, he should do his best to persuade the parties to agree to submit the dispute to binding arbitration.[ A primer on Alternative Dispute Resolution]

Courts and arbitrators decide the dispute after a contest between the parties, while in the case of conciliation the final result depends on the will of the parties. In such type of methods the resolution of conflict by conciliation, emotional harmony between the parties does not suffer. There is a caveat to the resolution on dispute by conciliation to have it effectively implemented. It is necessary to have trained conciliators at the disposal of courts so that regular cases can be disposed of with the aid of parallel mechanism thereby unburdening the courts and other reducing judicial delays.

Conciliation mends relationship. It is an informal method of dispute resolution. It places emphasis on peace and harmony over conflict, litigation and victory. It is the first step and in any dispute between the parties if it does not work then the parties should resort to arbitration. As arbitration in the modern times, though is considered a better means to resolve disputes over litigation, has some negative points too because here also, a third party decides on the behalf of the conflicting parties. Conciliation on the other hand, has no similarity with litigation as such; it gives a lot of scope for the parties in conflict to resolve the disputes by their own will and determination. An ideal way of proceeding in a case of a dispute would be first try resolving the dispute by conciliation and if that doesn’t work resort to arbitration.

According to certain social scientists and other scholars, ADR mechanisms would yield remedies better tailored to parties’ unique needs and more direct involvement of disputants would encourage greater compliance with outcomes and help rebuild ruptured relationships. Thus, it can be reasonably concluded that Conciliation, being the precursor to arbitration, is definitely for the good.

Conciliation is unquestionably a better option than arbitration as the experience in past few years has shown that arbitration is neither inexpensive nor time saving. In cases where court has been given the authority to review the outcome, the advantage does not appear to be real on account of first spending time before the arbitration tribunals and then in courts. Conciliation is a more amicable way to settle disputes without harming the personal relations as well. Thus, the pros of Conciliation are categorically more than arbitration which asserts my stand that it is for the better.

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ISHA MODI is a 3rd year B.A.LL.B (Hons) student at Gujarat National Law University, Gandhinagar (Ahmedabad).