In News:Parliamentary Standing Committee on Law and Justice, has recommended substantial changes to the Mediation Bill, meant for institutionalisation of mediation and establishment of the Mediation Council of India.
Key Features of Mediation Bill, 2021
Pre-litigation mediation:
Parties must attempt to settle civil or commercial disputes by mediation before approaching any court or certain tribunals.
Even if they fail to reach a settlement through pre-litigation mediation, the court or tribunal may at any stage refer the parties to mediation if they request for the same.
Disputes not fit for mediation:
The Bill contains a list of disputes which are not fit for mediation. These include disputes:
relating to claims against minors or persons of unsound mind,
involving criminal prosecution, and
affecting the rights of third parties.
The central government may amend this list.
Applicability:
The Bill will apply to mediations conducted in India:
involving only domestic parties,
involving at least one foreign party and relating to a commercial dispute (i.e., international mediation), and
if the mediation agreement states that mediation will be as per this Bill.
If the central or state government is a party, the Bill will apply to:
commercial disputes, and other disputes as notified.
Mediation process:
Mediation proceedings will be confidential, and must be completed within 180 days (may be extended by 180 days by the parties).
A party may withdraw from mediation after two sessions.
Court annexed mediation must be conducted as per the rules framed by the Supreme Court or High Courts.
Mediators:
Mediators may be appointed by:
the parties by agreement, or
a mediation service provider (an institution administering mediation).
Mediation Council of India:
The central government will establish the Mediation Council of India.
The Council will consist of a chairperson, two full-time members, three ex-officio members , and a part-time member from an industry body.
Functions of the Council include:
registration of mediators, and
recognising mediation service providers and mediation institutes
Mediated settlement agreement:
Agreements resulting from mediation (other than community mediation) will be final, binding, and enforceable in the same manner as court judgments.
They may be challenged on grounds of: (i) fraud, (ii) corruption, (iii) impersonation, or (iv) relating to disputes not fit for mediation.
Community mediation:
Community mediation may be attempted to resolve disputes likely to affect the peace and harmony amongst residents of a locality.
It will be conducted by a panel of three mediators (may include persons of standing in the community, and representatives of resident welfare associations).
Key Issues
The Bill makes participation in pre-litigation mediation mandatory. Mediation is a voluntary dispute resolution process. On one hand, this could lead to more out of court settlements and reduce the pendency in courts. On the other hand, mandating mediation goes against its voluntary nature.
The moment any law is made on the subject it becomes the guiding force.
The Bill proposes a clause giving the powers to court to make rules for ‘court annexed mediation’, which is unconstitutional.
It also raises the question on the non-applicability of the provisions of the Bill to disputes/matters of non-commercial nature involving the Government and its agencies.
The Mediation Council requires prior approval from the central government before issuing regulations related to its essential functions.
It is not clear why such prior approval is required.
This may also be questioned since the central government may be a party to mediations.
The Bill applies to international mediations onlyif they are conducted in India.
It does not provide for enforcement of settlement agreements resulting from international mediation conducted outside India.
