Conciliation and Mediation

What is Conciliation?

Conciliation is a process in which a third party assists the parties to resolve their dispute by agreement. A Conciliator may do this by expressing an opinion about the merits of the dispute to help the parties to reach a settlement. Conciliation is a compromise settlement with the assistance of a Conciliator.

Conciliation is a voluntary and non-binding process in comparison to Arbitration and Litigation. Any party may terminate Conciliation proceedings at any time even without giving any reason. The other important difference is that the parties control the process and outcome of the dispute, which is not the case in Arbitration as well as litigation. Conciliation is a consensual process whereas Litigation and Arbitration solemnly urge the parties for an amicable reconciliation and have no control on the outcome of the dispute or the process.

What is Mediation?

Mediation is a process for resolving disputes with the aid of an independent third person that assists the parties in dispute to reach a negotiated resolution. Mediation is the acceptable intervention into a dispute of a third party who has no authority to make a decision. The objective of the third party is to assist the parties in reaching an acceptable resolution of the dispute. The Mediation process is voluntary and does not eliminate other dispute resolution options. It is confidential, whether or not it results in the settlement and resolution of the dispute.

How is Mediation different from Conciliation?

Many a times, conciliation and mediation are used interchangeably and they are together referred to as Mediation. A Mediator assists the parties to reach an agreement for resolving the dispute and he does not express his opinion on merits of the dispute, whereas a Conciliator may express an opinion about the merits of the disputes. In both, a third party is appointed to assist the parties to reach a settlement of their dispute. The Mediator is not given any power to impose a settlement. His function is only to try to break any deadlock and encourage the parties to reach an amicable settlement. A Mediator does not determine a dispute between parties.

A Mediator may act as a communicator filtering out the emotional aspects and allowing the parties to focus on the key issues. He encourages the parties to reach an agreement on their own as opposed to having it imposed upon them.

What are the limitations of Conciliation?

ADR techniques such as Conciliation, Negotiation and Mini-Trials have the benefit of less time and less cost but there is no assurance that they would result in a settlement of disputes as these are non-binding and voluntary modes. These techniques bring the parties closer but the settlement is not compulsory. Any party may walk out of such proceedings at any time or may not agree even to a very fair settlement. Many times it has been observed that for the respondent, it is a case of either total liability or no liability and to avoid liability he may refuse even a fair settlement.

What is 'Pre-Trial Mediation'?

A provision is introduced in section 89 of the Code of Civil Procedure as amended in 2002 for encouragement of pre-trial alternatives for resolving the disputes. This provision provides for Conciliation, Mediation and pre-trial settlement methodologies. Pre-trial Mediation is a settlement of disputes by the efforts of the Courts before initiation of proceedings before it.

What do you mean by the expression 'Med-Arb'?

'Med-Arb' is a dispute resolution process that combines some of the features of both Mediation and Arbitration. Most 'Med-Arb' proceedings call for a third-party Neutral to first mediate or help the parties agree to as many issues as possible and then, by agreement of the parties, to arbitrate or make a decision on those that remain. The same neutral person may perform both roles.

When an Arbitration proceeding is pending in an Arbitral Tribunal, the Arbitral Tribunal may encourage the settlement of dispute by Mediation with the consent of the concerned parties. The Arbitral Tribunal may use Mediation, Conciliation or other procedures at any time during the arbitral proceedings with the consent of parties to encourage settlement. If, during arbitral proceedings, the parties settle the dispute, the Arbitral Tribunal terminates the proceedings. The Arbitral Tribunal can also record the settlement in the form of an Arbitral Award on agreed terms on the request of the parties. Such an award has the same status and effect as any other Arbitral Award on the substance of the dispute. It is called Mediation during Arbitration i.e. Med-Arbitration. Relevant provision is provided in section 30 of the Arbitration and Conciliation Act, 1996 in this regard.

What is 'Hybrid Conciliation, Mediation and Arbitration'?

In this ADR process, if the parties are unable to reach resolution through Conciliation, the Conciliator becomes an Arbitrator with written consent of the parties. He converts the proceedings into one of Arbitration and seeks additional evidence from the parties as, since witnesses are not normally called in Conciliation, and thereafter he renders an arbitral decision.

If the Conciliator fails in his efforts, he can proceed as an Arbitrator to make an award on the substance of dispute. Initially, parties start with Conciliator but after sometime, they authorize the Conciliator to act as Arbitrator and decide the dispute. However, in such cases consent of both parties is required. These are called 'Hybrid Conciliation, Mediation and Arbitration'.