Opinion Mediation Bill: An incomplete settlement

Recognition and enforcement of settlement agreements arising out of mediation is a welcome move. This is also in line with India’s commitment as a signatory to the United Nations Convention on International Settlement Agreements Resulting from Mediation (Singapore Convention). That said, the limited grounds listed to challenge the enforcement of a settlement agreement and the fact that a period of 90 days is given to raise the challenge need a relook. One must not lose sight of the fact that a settlement agreement is essentially a contract between the parties — there are several instances where grounds for challenge such as fraud and impersonation are detected at a later stage. Our limitation laws rightly give a three-year window to initiate proceedings from the date of cause of action — the exception afforded to settlements under the Bill may render grieving parties remedy less on the ground of delay alone.

There are also some technical flaws. For instance, Clause 8 of the Bill entitles a party to move the Court, before the commencement or during mediation, for interim relief, only in “exceptional circumstances”. The term “exceptional circumstances” is not only undefined in the Bill but is also anomalous to the settled principles of seeking interim relief before the civil courts — establishing prima facie case, the balance of convenience and irreparable injury. Moreover, there is no remedy of appeal available against an order passed under this proposed section. Even our arbitration regime provides an appellate recourse.

The Bill introduces the concepts of “online” and “community” mediation. A recent Niti Aayog report reveals that only 55 per cent of India have access to the internet and only 27 per cent possess compatible devices. For online mediation to be a success, we will have to scale our bandwidth accessibility to remote parts of the country. Setting up legal aid or access to justice clinics with adequate IT infrastructure could address this issue. As for community mediation, the Bill makes it mandatory to have a panel of three mediators. This requirement is unnecessary and impinges on the flexibility that mediation brings.

The real issue is that the government is the biggest litigant in the country. Restricting the amenability of the government to participate in mediation proceedings arising only out of “commercial disputes” goes against the objective of enacting the legislation. The standing committee had also recommended that government-related disputes be included in the Bill. The common litigant sees the government as an adversary before the court of law. The Bill provided a golden opportunity to the government to change that perception. This would not only have inspired confidence amongst all stakeholders but would have also helped in reducing our pendency backlog.
Mediation should be promoted as a preferred and voluntary mode of securing justice. The Bill is prescriptive. The ordinary citizen will now require even more handholding to get justice. The Bill is more on form than on spirit. In the words of L J Warren, the 14th Chief Justice of the United States, “it is the spirit and not the form which keeps the justice alive”.

The writer, a lawyer, is partner at Numen Law Offices