CONCEPT OF ARBITRATION & MEDIATION
Alternative Dispute Resolution (ADR) is the new law of the society which was highly promoted by the judicial bodies and by the advocates. ADR is the new way of resolving disputes among the individuals or companies. The rising popularity of ADR can be explained by the increasing case load of traditional courts, the perception that ADR imposes fewer costs than the litigation costs the clients inside the court, a preference for confidentiality, and the desire of some parties to have greater control over the selection of the individual or individuals who will decide their dispute/matter. Many senior judiciaries support the concept of ADR as it really helps in dealing the cases more effectively.
ADR consists of various methods as it includes: –
a) Arbitration
b) Mediation
c) Negotiation
d) Conciliation
Both Arbitration and Mediation are the types of ADR followed by the people all over the country. Both of them are different from each other but at the same time similar too.
Arbitration
Arbitration is a process by which the parties appoint an Arbitrator who hears the case of both parties, as the matter proceeds in the same manner as it goes in the court. Arbitration is Quasi judicial body due to which the award (decision) passed by the arbitrator is binding on parties and it holds the value of a Decree of the civil court. Arbitration is more likely a formal process. An arbitrator could be anyone he could be a retired judge, a senior lawyer or a professional such as an accountant or engineer or any other person which the parties may think fit. During arbitration, both the parties are given an opportunity to present their cases to the arbitrator and after hearing both of them and their witnesses the arbitrator passes the award. Arbitration is a simplified version of a trial involving the limited discovery and simplified rules of the evidence.
Arbitration is an alternative way of going to the court as the proceedings are totally legal in nature due to which the companies / MNC’s prefer to come in arbitration rather
than going to court for fighting cases. Arbitration in India is governed by “The Arbitration and Conciliation Act, 2015 passed by the parliament.
a) Arbitration can be voluntary or compulsory (if ordered by court).
b) The court can order on request of either party or by using Suo moto can transfer the case to the Arbitration.
c) Arbitrators do not need any legal or formal training to be appointed as an arbitrator.
d) Any person can be appointed as an arbitrator by the parties.
e) There can be more than one arbitrator but not more than 5 arbitrators.
f) Either party can appeal in the court against the arbitral award.
g) Arbitrator function is to render only a decision regarding the matter, as an arbitrator cannot suggests something to the parties.
Thus there is no scope of negotiation in the arbitration as the award will always go against one of the party belonging to the matter. But laws have also provided a legal right to the parties to appeal against the order passed by the arbitrator if they are unsatisfied with it.
Mediation
Mediation is a process by which the parties come to a mutual agreement and negotiates accordingly. In this process the parties appoint a Mediator or Negotiator. Mediators do not issue orders, find fault of the party, or make determinations. Instead, mediators help parties to reach a settlement by assisting with communications, obtaining relevant information, and developing options. Although mediation procedures may vary from one mediator to another as the standard procedure is somewhat like this
a) The parties’ usually first meet together with the mediator informally to explain their views of the dispute.
b) The mediator will then meet with each party separately.
c) The mediator discusses the dispute with them separately first, and explores with every possible ways to resolve it.
d) It is common for the mediator to go back and forth between sides a number of times.
e) The main focus remains on the parties, as they work towards a mutually beneficial solution so that the mediation ends faster.
f) Most disputes are successfully resolved and often the parties will then enter into a written settlement agreement.
Mediators need not any formal or legal training as any person with the qualities of a negotiator can be appointed by the mutual consent of the parties, as there could be more than one mediator at the time of mediation. Mediation can be voluntary or compulsory (if ordered by court). During the Mediation the trail is stayed (put on hold) in the court.
The Outcome is generally the mutual agreement done by the negotiating the things among the parties as both the parties cannot get what they want, they have to sacrifice something to reach to an outcome.
CONCLUSION
Although mediation and arbitration have the same goal in mind but they are not totally same. The main difference between arbitration and mediation is that in arbitration the arbitrator hears evidence and makes a decision. Arbitration is like the court process as parties still provide testimony and give evidences similar to a trial but it is usually less formal and done outside the court rooms. In mediation, the process is a negotiation with the assistance of a neutral third party. The parties do not reach a resolution/agreement unless all sides of the matter agree. They sign the agreement with their choice thus they have to follow the agreement they agreed to in the mediation. Many people report a higher degree of satisfaction with mediation than with arbitration or other court processes because they can control the result and become a part of the agreement/resolution.
