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Delay and Arrear Reduction in ADR

Written by: Jhuma Sen - 5th Year BBA.LLB, Symbiosis Law School, Pune
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“The speedy arm of justice was never
Known to fail;
The gaol supplied the gallows; the
Gallows thinned the gaol,
And sundry wise precautions the
Sages of the law
Discreetly framed whereby they
Aimed to keep the rogues in awe.” --John W. Smith

There is an old Chinese proverb— “May you live in interesting times.” We are, indeed living in interesting times. With the advent of Alternative Dispute Resolution which provides for an additional forum in the dispute resolution mechanism, the concept of resolving disputes has undergone a sea change.

The philosophy of Alternate Dispute Resolution systems is well stated by Abraham Lincoln in these terms: “discourage litigation, persuade your neighbours to compromise whenever you can. Point out to them how the normal winner is often a loser in fees, expense, cost and time.” We cannot stop the inflow of cases nor should we. The doors of justice cannot and must not be closed. There are two ways to increase the outflow. We can strengthen both qualitatively and quantitatively the capacity of the existing system. We can also find out some additional outlets. Congestion in courts, lack of adequate manpower and resources and the consequent delay, cost, rigidity of procedure and lack of participatory roles, also spawn the need to look at better options, approaches and avenues. Alternative Dispute Resolution methodologies with a positive framework point out to one such option.

ADR has been a spoke in the wheel of the larger formal legal system in India since time immemorial. If we take a look at our history, we find that during ancient and medieval period disputes have been resolved in an informal manner by a neutral third person, who would be either an elderly person or a chief of a village clan. The Indian epics and folklore abound with examples of consensual procedures for the settlement of disputes at the grassroots level. The adversarial system of justice, which we adopted later has proved to be ‘costly and time consuming’. Time is consumed by procedural wrangles, technicalities of law and inability of large number of litigants to engage lawyers. The problem of delay in deciding matters has resulted in this long pendency. As the adage goes—justice delayed is justice denied. Speedy justice has now been accepted as part of the constitutional guarantee.

Delayed Justice and the Urgent Need of the Hour

The mounting arrears in the courts, inordinate delays in the administration of justice and expenses of litigation have the potential to erode public trust and confidence in the judicial system, which is the pillar of our democracy. The need to get away from the conception that court is the only place to settle disputes has led to exploring the possibility of creating a dispute resolving mechanism which would be flexible and saves valuable time and money. The Law Commission of India, in its 14th Report recommended devising of ways and means to ensure that justice should be simple, speedy, cheap, effective and substantial. In its 7th Report Law Commission of India observed that the Indian society is not sophisticated enough to understand the technical and cumbersome procedures followed by the courts.

ADR as the Additional Dispute Resolution System

The search for a simple, quick, flexible and accessible dispute resolution system has resulted in the adoption of ‘Alternative Dispute Resolution’ mechanisms. Alternative Dispute Resolution (ADR) is known as an alternative to the regular dispute resolution by Courts of Law. In any country, traditionally the disputes are resolved by Courts. Alternatively the disputes can also be resolved with third party help.

In India disputes are resolved in the following ways:
Moving Courts of Law
Mediation of elders to reach settlement in joint families and certain sects/tribes etc
Elders deciding (adjudicating) the issues in joint families and certain sects/tribes etc.
Panchayat System
Lok Adalat under the Legal Services Authorities Act, 1987
Third party help.

Third Party help means an independent third person as chosen by the disputants, acting impartially and within the scope and parameters of law. Third Party help can be taken in the form of mediation, conciliation and arbitration. This system of ADR ultimately acts as a supplemental system to the regular court mechanism. It is more apt to call Alternate Dispute Resolution as ‘Additional Dispute Resolution System’

Disputes like family disputes, contractual disputes, motor accident claims, disputes with neighbours, and several other categories of civil and petty criminal cases, which form a substantial percentage of pending litigation, can be more satisfactorily settled by ADR than court. It has been very rightly said that “An effective judicial system requires not only that just results be reached but that they be reached swiftly.” There is a need to clear mounting backlog of cases and make litigation affordable to the ordinary people. Indian legislature has made many efforts by making and improving ADR laws in India to address these problems of delays and backlog of cases.

Section 89 of the Civil Procedure Code: The Welcome Addition

ADR has been successful to the extent that over 90 percent of the cases are settled out of court in certain countries like USA. There it is a legal requirement that the parties to the suit must indicate the form of ADR which they would like to resort during the pendency of the trial of the suit. A similar provisions have been introduced by adding a New Section 89 and Rules 1-A, 1-B, & 1-C in order X in the Code of Civil Procedure which provide for a compulsory settlement of disputes by ADR.

The formal acceptance of ADR not just as an ‘alternative’ means, but as an additional method utilized by the Courts has never been more apparent than it is via Section 89 of the Code of Civil Procedure. The purpose of bringing Section 89 in the body of the Code has been so stated in the object clause—“with view to implement the 129th report of Law Commission of India and to make conciliation scheme effective, it is proposed to make it obligatory for the Court to refer the dispute after issues are framed, for settlement either by way of arbitration, conciliation, mediation, judicial settlement or through Lok Adalat”. Due to this clause, at the very stage of framing of issues the judge can use his discretion to find the most appropriate means of resolution of a matter before him and if necessary refer the matter to:
· Arbitration
· Conciliation
· Judicial Settlement including Lok Adalats,
· Mediation etc

Section 89 of CPC is a new provision and even though arbitration or conciliation has been in place as a mode for settling the disputes, this has not really reduced the burden on the courts. Supreme Court of India in Salem Advocate Bar Association, T.N. Vs. Union of India had observed that modalities have to be formulated for the manner in which section 89 of CPC and, for that matter, the other provisions which have been introduced by way of amendments, may have to be in operation. A Committee was constituted by Supreme Court so as to ensure that the amendments made become effective and result in quicker dispensation of justice.

Section 89 of CPC has been inserted to try and see that all the cases which are filed in court need not necessarily be decided by the court itself. Keeping in mind the law’s delays and the limited number of judges which are available, it has now become imperative that resort should be had to ADR mechanism with a view to bring to an end litigation between the parties at any early date. The ADR mechanism as contemplated by section 89 of CPC is arbitration or conciliation or judicial settlement including settlement through Lok Adalat or mediation.

As can be seen from Section 89 of CPC, its first part uses the word “shall” when it stipulates that the “court shall formulate terms of settlement”. The use of the word “may” in later part of Section 89 of CPC is that where it appears to the court that there exists an element of a settlement which may be acceptable to the parties, they, at the instance of the court, shall be made to apply their mind so as to opt for one or the other of the four ADR methods mentioned in the Section and if the parties do not agree, the court shall refer them to one or the other of the said modes. In other words section 89 of CPC is provision in law to facilitate introduction of court annexed ADR. The CPC has clear provisions regarding ADR and the people have started to reap the benefits of the system. Civil court can introduce ADR under the provisions of the Civil Code for settling the disputes.

Role of ADR

A special feature of the Arbitration and Conciliation Act, 1996 is “Settlement Agreement” in conciliation proceedings. If the settlement agreement is signed by the parties and authenticated by the conciliator, it will attain the status of a decree of a Court of law under section 74 of the Arbitration and Conciliation Act, 1996. The District Legal Services Authorities in the districts in India can play a very crucial role in this respect and several disputes can be resolved by conciliation—“settlement agreements”, so that the disputants need not move a court fore resolution of their disputes. They have to move courts only for execution of proceedings if necessary.

Role of Courts
The courts can play a very effective role in reducing the arrears in courts by using ADR methods. Under section 89 the Courts are empowered to refer a pending case/dispute to arbitration, conciliation, judicial settlement including settlement through Lok Adalat or mediation subject to the acceptance of the parties. The Courts under this section can play a very pivotal role in settlement of disputes by invoking different alternative dispute resolution methods. This provision aims at reducing the arrears and delays in Courts and ensures speedy justice.

The Andhra Pradesh High Court aided by the Andhra Pradesh Government pursuant to the decision of the Supreme Court in Salem Advocate Bar Association, T.N. Vs. Union of India had made the first forward move by appointing 23 Senior Civil Judges as full time Secretaries of the District Legal Services Authority for 23 Districts in the State of Andhra Pradesh during August 2006. These Secretaries are performing commendable tasks in resolving disputes through mediation and conciliation. Along with these the High Court of Andhra Pradesh has also programmed workshops on arbitration and conciliation for Judicial Officers/Advocates and other intelligentia in those 23 Districts which are being conducted with the aid of International Centre for Alternative Dispute Resolution, Hyderabad in coordination with the District Legal Services authority of the respective districts. So far 6 districts have been covered by the six programmes. Similar programmes are most urgently required by the other State High Courts.

Words of Caution:
ADR cannot be used as a panacea—a cure all for all legal disputes. For every dispute ADR is not the answer. Several issues like admitted liability, divorce, granting of probates etc cannot be referred to arbitration. ADR can only be adopted when there is no statutory bar and further if parties agree to. The Court invoking section 89 of CPC must be cautious of this fact.

Hurdles in the effective implementation of ADR are many which include the following
Lawyers and Judges should together play a pivotal role
Lack of infrastructural facilities
Lack of awareness and legal literacy

Further, it has always been argued that arbitration sometimes proves to be more costly than court litigation. Hence care should be taken that in letter and spirit the arbitration and conciliation must prove to be cost effective and highly qualitative in results. The quality of ADR should maintained by the person handling it. The Arbitration and Conciliation Act in this regard provides for the Court’s intervention at the appropriate situation so that ADR is not misused resulting in miscarriage of justice.

The approach to implement ADR would facilitate in curing the damage already caused by the prevailing legal system. The future of India lies in cost effective and time saving Alternative Dispute Resolution Mechanisms.

The author can be reached at: senjhuma1984@legalserviceindia.com or sen.jhuma@gmail.com / Print This Article

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