For centuries humans have been settling most of their disputes with one or
another method, the issue of enforceability is a settled issue in field of court
process. On the other hand, mediation lacks clarity in terms of
enforceability because of this ambiguity few mediation settlement agreements are
not respected and as a result parties revoke from their promise.
The settlement agreement reached by consensus between parties is nothing but an
adjustment or a settlement which parties have agreed to, unlike a contract same
could not be enforceable unless there is a supporting authority that validates
the agreement. The Concept of 'Mediation' was only supported few statutes
like, in the Section 89 of Code of Civil Procedure (CPC), Section 30 of the
Arbitration And Conciliation Act, 1996 and the Commercial Courts Act. The scope
of authorities supporting Mediation was very few, but this all has changed
quickly after the enactment of Mediation Act,2023.
Section 19 (1) of the mediation act gives a concrete definition of "settlement
agreement" which is:
"An agreement which is in writing between some or all of the parties resulting
from mediation, settling some or all of the disputes between such parties, and
authenticated by the mediator."
It should be noted that Mediation Agreements have to be in written format only,
any agreement that is not written or agreed verbally cannot be enforceable, this
can be a shortcoming of the mediation act as courts overworld have ruled that
settlements done verbally can be enforceable to. Such as Pascarella vs Bruck.
The number of cases where parties do not respect the settled mediation agreement
are very few as the feature of the Mediation that enables the party to take
decisions Voluntarily gives them the sense of authority and responsibility of
the resulting settlement but on contrary the same feature enables the parties
from not following up on the agreed terms and deny from accepting the mediation
agreement. In the end the questions rests whether Mediation Agreements are
enforceable or not?
Enforcement of Mediation Settlement Agreement under Mediation Act.
Answering the million-dollar question, are mediation agreement enforceable? The
short answer to this is YES. Mediation Agreement are enforceable and the
provisions under chapter VI deals with the same issue.
A settlement reached between parties in a mediation is binding upon the parties
in the same manner as a contract, or as a decree of a court. Hence, an
agreement reached by parties in negotiation takes a form of a contract similar
to the provisions in the USA and England and same is enforceable as per the
provisions of Civil Procedure Code.5
Challenging Mediation Agreement
A mediation agreement can be challenged before a competent court or a tribunal
of proper jurisdiction. The ground on which a mediation agreement can be
challenged are all or any of the below:
- If the mediation is conducted for disputes not fit for mediation. As
specified under Schedule 1 of the act, which are disputes which are
prescribed against mediation by virtue of any law for the time being,
disputes relating to minors, deities; disable person. Matters involving
criminal offences and others included in first schedule.
An application for challenging the mediated settlement agreement shall not be
made after ninety days have elapsed from the date of from receiving the copy of
The provisions listed above explains the aspects of enforceability of mediation
agreement and appealing against an invalid mediation agreement. This compulsion
of binding the mediation upon the parties may seem against the pillar of the
mediation of Voluntary nature of mediation, but this limitation is necessary to
promote and make mediation a viable option. If this compulsion would not exist
it would lead to parties agreeing to the conditions in the agreement for the
sake of agreeing but not following up to same. Therefore, compulsion to perform
the agreement is required to cultivate mediation in India.
It is also necessary to understand the reasons parties back out of settlement
the reasons can be out of many factors, but to outline some are:
- After thought of the practicality of the solution.
- Knowledge of certain new facts or information.
- Desire for more than what previously agreed to.
- Duress during the mediation.
- Meet the demands of individuals not present in the mediation session.
- Finding other remedy that has better relief.
Most of the reasons listed above are of preventable nature, revocation from a
mediation agreement due to above factors can be prevented by a mediator with
experience, as the behavior of parties throughout the mediation settlement can
hint whether they are inclusive in the process. If the mediator feels like they
are not interested in reaching to a settlement or confused about the process, he
can take initiative to clear any type of misunderstanding or confusion.
The ambiguity of a mediation agreement whether being enforceable has been
answered and conferred by the Court in the Mediation Act,2023 which makes it
enforceable, however the limitations make it that only that the written
agreements are enforceable, leaving out the verbal agreements, this leaves
another vacuum unanswered questions and complications about the verbal
It is necessary to make provisions for enforceability of the agreement, as this
is a necessary evil for betterment of Mediation in the country. Chapter VI of
the Mediation Act is the heart of the act as this solves the huge issue which
was enforceability of the mediation agreement.
- Fiss, Against Settlement, 93 YALE L. J. 1073, 1084-85 (1984).
- Enforceability of the Mediation Outcome | Pg. 20 Paragh (1)
- Section 19 (1) of Mediation Act, 2023
- 190 N.J. Super. 118
- Section 27 of Mediation Act.
- Section 28 of Mediation Act.
- First Schedule of Mediation Act.