Exploring Alternative Dispute Resolution in Local Governance

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21-May-2024 | Maitri Singh

“Discourage litigation. Persuade your neighbours to compromise wherever you can. Point out to them how the nominal winner is often a looser – in fee, expenses and waste of time.”

-Abraham Lincoln

Contradictions, conflicts, and disputes are inherent to human civilization, which makes the role of ‘peacemaking’ also fundamentally essential for progress. Peace also comes from people's faith in the justice delivery system which means that when individuals trust that justice will be served, society remains peaceful and orderly. However, the picture of the current judicial process is bleak. It is often slow, and causes prolonged uncertainty and suffering for litigants. Despite efforts to expedite proceedings, cases can last a lifetime or even extend to the next generation, which not only deplete existing resources but also cause physical and mental strain to the concerned parties. This lengthy process can also escalate civil disputes into criminal cases, which necessitates the need for a more efficient justice system. In this regard, ADR has emerged as a significant and unique solution.

What is ADR?

Alternative Dispute Resolution (ADR) refers to any method of resolving disputes without litigation. In other words, it is a non-conventional avenue for addressing a myriad of legal issues including civil, commercial, industrial and family, when conflicting parties find themselves unable to reach a consensus. The most common and known ADR methods include arbitration, negotiation, mediation, conciliation, and Lok adalats. The core objective of ADR is to offer a fair and efficient alternative to the traditional judicial system. It is viewed as a fast-track method for dispensing justice.

What is the Need of ADR?

The necessity for ADR mechanisms comes from the mounting backlog of cases that strain the Indian judiciary. Litigants are left in prolonged states of uncertainty, as the courts get increasingly overwhelmed and judicial vacancies exacerbating delays. The alarming statistics on pending cases at both the Supreme Court and High Courts therefore necessitate alternative approaches to dispute resolution such as ADR.

Historical Background

While the roots of ADR in ancient Indian society traced back to ‘Nyaya-Panchayats’, in the present age it comes from the country's constitutional ethos, particularly the pursuit of complete justice that is enshrined in Articles 14 and 21, that guarantees equality before the law and the right to life and personal liberty, respectively. The Directive Principle of State Policy under Article 39-A also underscores the importance of equal justice and free legal aid. In addition, key legislative frameworks governing ADR in India include the Arbitration and Conciliation Act, 1996, the Legal Services Authorities Act, 1987, and Section 89 of the Code of Civil Procedure. The amendments of the Arbitration and Conciliation Act of 1996 in 2015, 2019, and 2021 introduced fast-track arbitration and ensured the neutrality of arbitrators, and provided for staying awards induced by fraud or corruption. The Commercial Courts Act of 2015, amended in 2018, mandates Pre-Institution Mediation and Settlement (PIMS) for commercial disputes, promoting mediation before court proceedings. Furthermore, the India International Arbitration Centre Act of 2019 established a world-class arbitration institution with the necessary infrastructure to facilitate both domestic and international arbitrations. The Mediation Act of 2023 also provides a comprehensive framework for mediation, encouraging amicable out-of-court settlements.

Types of ADR

ADR methods such as arbitration, conciliation, and mediation, negotiation and lok adalats serve as mechanisms for impartial resolution, free from the complexities and delays often associated with traditional litigation processes.

Arbitration: In arbitration, the dispute is submitted to an arbitral tribunal that issues a binding decision known as an "award." This process is less formal than a trial, involving the concerned parties selecting the person to hear and resolve their dispute through a consensus, with relaxed rules of evidence. Generally, there is no right to appeal the arbitrator's decision, and judicial intervention is minimal, limited mostly to some interim measures.
Conciliation: Conciliation is a non-binding procedure where an impartial third party, the conciliator, helps the disputing parties reach a mutually satisfactory settlement. Unlike arbitration, conciliation is less formal and allows parties to accept or reject the conciliator's recommendations. However, if both parties accept the settlement document, it becomes final and binding.
Mediation: Mediation involves an impartial mediator who assists the parties in reaching a mutually acceptable resolution. The mediator does not decide the dispute but facilitates communication between the parties, allowing them to settle the dispute themselves. The control of the outcome remains with the parties.
Negotiation: Negotiation is a non-binding process where the parties engage in direct discussions without any third-party intervention to arrive at a settlement. It is the most common ADR method and occurs in various contexts, including business, non-profit organisations, government, legal proceedings, and personal situations like marriage, divorce, and parenting.
Lok Adalat: Lok Adalats, or People's Courts, are unique to the Indian legal system, aimed at encouraging out-of-court settlements. Established under the Legal Services Authorities Act of 1987 and reinforced by the Arbitration and Conciliation Act of 1996, Lok Adalats provide an informal setting for negotiation in the presence of a judicial officer. The decisions made in Lok Adalats are final, binding, and deemed to be decrees of a civil court, with no option for appeal in a court of law. Lok Adalats every year on average in the last three years, have managed to dispose of more than 50 lakh cases alone.

ADR and Local Governance

ADR techniques can enhance local governance by providing efficient, accessible, and amicable ways to resolve disputes.

Help in Reducing Case Backlogs- ADR can help reduce the burden on local courts by resolving disputes outside the traditional courtroom. This can expedite the resolution process for cases that do go to court, thereby improving the overall efficiency of the local justice system.
Cost-effective- ADR methods, such as mediation and arbitration, are generally less expensive than traditional litigation. This cost-effectiveness can be particularly beneficial for local governments with limited budgets and resources.
Community Engagement and Involvement- ADR involves the community in the resolution process, fostering a sense of participation and ownership. Techniques like mediation and conciliation can be tailored to respect local customs and traditions, enhancing their acceptability and effectiveness.
Provides Timely Resolution- ADR processes are generally faster than court proceedings. Quick resolutions can prevent disputes from escalating and becoming more complex, which is particularly important in local governance where timely decisions are crucial for maintaining social order and public trust.
Preserving Relationships- Unlike adversarial litigation, ADR focuses on collaborative problem-solving, which can help preserve relationships between disputing parties. This is important in local communities where ongoing interactions between parties are common.
Customizable Solutions- ADR allows for creative and customized solutions that are tailored to the specific needs and interests of the parties involved. This can lead to more satisfactory and sustainable outcomes for local disputes.
Conflict Prevention- By addressing conflicts early and effectively through ADR, local governments can prevent disputes from escalating. Proactive conflict management contributes to a more harmonious community and reduces the need for more intensive interventions later.
Building Trust- When local governments effectively use ADR, they can build greater trust and legitimacy in the eyes of their constituents. Transparent and fair dispute resolution processes demonstrate a commitment to justice and community well-being.
Public Perception- A local governance system that integrates ADR demonstrates a progressive approach to dispute resolution, enhancing public perception and trust in local authorities' ability to manage conflicts efficiently and justly.

Challenges to ADR

The growth of ADR in India faces several challenges from circumstantial factors to legal factors. Firstly, limited government support due to uneven development across regions hampers widespread adoption and development of ADR mechanisms. The inadequate infrastructure and funding constraints result in a scarcity of ADR centers, especially in smaller cities and towns. This makes it burdensome for parties to access these dispute resolution avenues without extensive travel. On the other hand, legal complexities arise as courts often intervene excessively in ADR proceedings, impacting the autonomy and efficiency of the process. Moreover, the shortage of skilled ADR professionals due to educational gaps further complicates matters and contributes to ineffective dispute settlements. Limited awareness among the populace, particularly in disadvantaged segments, is another major challenge that inhibits the growth of ADR. The power imbalances between parties also contribute to coercion, which impacts the fairness and credibility of ADR outcomes.

Conclusion

In conclusion, ADR techniques play an important role in local governance by improving the efficiency and effectiveness of dispute resolution. However, to enhance the effectiveness of ADR in India, courts should minimize their intervention. ADR tribunals should be established in every district for greater accessibility, and legal education should be included in school curriculums to raise awareness. Additionally, regulating fees for ADR professionals and providing proper training for legal professionals are further essential to make ADR accessible, affordable, and effective.

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