Negotiation Mediation and Arbitration

Arbitration is the third main method of Dispute Resolution. JustAct Dispute Resolution uses the mechanisms of Negotiation Mediation and Arbitration in order to let parties arrive at a consensual resolution without having to go to court.

Although the traditional court system is associated primarily with the dispensation of justice, methods of Alternative Dispute Resolution are beginning to be seen as viable correlatives in different industries that see a heavy volume of civil and commercial disputes. The overwhelming technicalities inherent in the practice of law, procedural complexities, inordinate delays and obscure language make the legal terrain challenging to navigate. It is in this context that ADR is gaining ground and the time and cost benefits of ADR are being foregrounded as among the better alternatives to the difficulties created by the court system.

This article will be divided into two segments and each segment will deal with the cost and time benefits inherent in the Alternative Dispute Resolution ecosystem, with a specific focus on Negotiation Mediation and Arbitration.

Arbitration

The costs of arbitration relate to certain heads such as fees of the lawyers apart from the expenses involved in the proceedings. Therefore, the contents of the arbitration clause and the procedure as agreed upon in the agreement or under the provisions of the applicable laws would determine the extent of the costs involved. The time and cost benefits of using arbitration are as follows:

1. Less interference by the courts

Under the Arbitration Mediation and Conciliation Act, 1996, arbitral awards are not subject to appeal. The Court may set aside arbitral awards under the grounds mentioned under Section 34 but this is not an appellate power to review the decisions made by arbitral tribunals. The 1996 Act was enacted in consonance with the UNCITRAL Model Law which sought to make arbitrations cost and time-effective by reducing the interference of the courts.

2. Expedited procedure

The Act, 1996 under Section 29B allows the parties to an Onlinearbitration agreement to resolve their dispute by fast-track procedure. This procedure provides that the arbitral tribunal shall decide the dispute on the basis of written pleadings, documents and submissions filed by the parties without any oral hearing. The award under this section shall be made within a period of six months from the date that the arbitral tribunal enters upon the reference. This is helpful for parties looking for speedy and effective resolution.

3. Greater level of expertise

Arbitrators are generally professionals with specialized domain expertise and hence, would provide better quality justice in shorter time periods because of their familiarity with the subject matter. This would also boost confidence in the quality of the proceedings and the resultant arbitral awards. The proceedings would be shorter compared to court hearings, less expensive and subject to the availability of the parties and arbitrators involved.

Mediation

Mediation allows parties to explore practicable and interest-based solutions in a private, person-centric, confidential space in order to ensure the continuance of business and personal relationships. This ensures that precious time and resources are saved by not taking recourse to the court system which could prolong disputes and bring strife into interpersonal and professional relationships. The time and cost benefits of using mediation are as follows:

1. Amount of preparation

The costs and length of IPR litigation in some European nations was captured by WIPO studies which show that litigation continues to be a time and cost-intensive process, which leads to narrower outcomes. However, it takes significantly less effort to bring parties to mediation. The mediator does not need to depend on voluminous evidence and statements in order to bring the parties to resolution.

2. Rapid settlements

Mediation provides a useful opportunity to the parties to identify the terms of the dispute with precision. The parties have the power to decide the scope of the mediation. This forms the basis for direct negotiation between the parties (in the presence of a neutral) without cumbersome delays. It allows the parties to identify only those issues that are significant to the dispute as also to reach quicker settlements that could be decided at any stage of the resolution process thus saving time and money.

3. Flexibility

There are no fixed methods in mediation; it is widely understood that different mediators adopt differing styles. This allows for a flexible tailored approach in keeping with the specific needs of the parties thus reducing time and miscellaneous costs. The parties also reserve the right to exit when they find the process unsuitable as a method of resolving their dispute.

4. Procedural costs

Since the presence of lawyers in mediation is not mandatory, this helps in saving costs in regard to payments made to legal professionals. There are also no procedural fees involved, unlike in litigation.

It is therefore, apparent that the costs of litigation far outweigh the costs of Alternative Dispute Resolution methods and the latter should be preferred in order to facilitate speedier and more effective resolution. The time spent by litigants in a labyrinthine legal system could be saved by taking recourse to other options that allow for more control and success in the resolution of disputes thus underscoring the time and cost benefits of using Arbitration Mediation and Conciliation.

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