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Module 5

An Introduction to JDR
1. INTRODUCTION

Judicial process is basically the process of working of the courts. All the things done by the
Judges in the delivery of Justice can be termed as Judicial Process. This process is an
adjudicatory process where a Judge or any other competent authority decides the outcome.
Provisions of the Relevant Statutes govern, restrict and control the procedures and decisions of
Judicial process. In Judicial system in accordance with law and the Constitution, the Judges
are required to decide upon the issues between the parties.

There are two sets of laws that govern the lives of citizens in every civilized society they are–
(i) substantive laws and (ii) procedural laws. The role of substantive laws is to decide the rights
and obligations of the citizens, on the other hand the procedural laws are made to provide an
enforcement framework for the substantive laws. It can be said that the importance of
substantive laws is contingent upon the qualitative deliverance of the procedural laws.

Constitution of India provides various provisions for judicial process, article 14 defines the
various duties of the state which includes providing justice by giving equal protection of law
to each and every citizen.

Similarly, Article 141 of the constitution lays down the hierarchical system of courts and says
“the laws declared by the supreme court shall be binding on all other courts in India”

Article 356 read with article 365 of the constitution provides for the consequences to the state
for non-compliance of constitutional obligations.

Indian judicial system is one of the oldest judicial system, its working is renowned all over the
world however it is also well understood that the Indian judicial process is becoming inefficient
in dealing with various pending cases, it is choked with long unsettled cases. Even setting up
of various fast track courts the cases are still piling up and the problem prevails.

To deal with such problem Alternative Dispute Resolution (ADR) mechanism becomes useful
to play its part, let us discuss about this mechanism in detail.

1.1 INTRODUCTION TO ALTERNATIVE DISPUTE RESOLUTION

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The concept of Alternative Dispute Resolution (ADR) mechanism can be defined as a
substitute method to the conventional way of resolving disputes. ADR can help to resolve all
the matters of dispute consisting civil, commercial, industrial and family etc., where the parties
are not able to conclude to any negotiation and reach the settlement.

In most cases, ADR in its methods uses a neutral third party who helps the parties to discuss
their differences, facilitate communication and resolve the dispute.

Such ADR techniques plays a very significant role in India to deal with the situation of
pendency of cases in courts of India, which subsequently helps in reducing the burden on
various courts in the count.

There are various types of Alternative dispute redressal techniques which are used, which
are arbitration, conciliation, mediation, negotiation and lok Adalat.

The main aim of ADR is to provide social, economic and political justice in the country and
enrich integrity, equal justice in the society. An important feature of ADR is that it helps in
provide the function of Free legal aid through some of its techniques as provided under article
39-A relating to Directive Principle of State Policy (DPSP).

The acts in India which deals with the provisions of ADR is Arbitration and Conciliation Act,
1996 and further Section 89 of the Civil Procedure Code, 1908 also says that , if it appears to
court there exist elements of settlement outside the court then the court may formulate the terms
of the possible settlement and refer the same for either Arbitration, Conciliation, Mediation or
Lok Adalat. Likewise, to make the ADR methods more effective and reliable, the Legal
Services Authorities Act, 1987 has also been amended to include the use of ADR methods.

The constitutional validity of ADR and section 89 of Civil procedure code was upheld by the
Hon'ble Apex Court in the case of Afcons Infrastructure Ltd. & Anr Vs. 2 Cherian Varkey
Construction Co. (P) Ltd. & Ors, reported in (2010) 8 SCC 24, but the frequency with which
ADR is utilized for resolution of disputes remains minute, which arises due to lack of
knowledge about the same or on account of the reluctance of the parties. The alternate forums
accorded under Section 89 are economically more viable as there are relatively lesser amount
of transaction costs and thus, there is a need to make people aware about the same.

2. DIFFRENCE BETWEEN ALTERNATIVE DISPUTE REDRESSAL AND

JUDICIAL DISPUTE REDRESSAL

Now let us differentiate between the judicial form of dispute redressal and Alternative dispute
redressal method.

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 ALTERNATE DISPUTE RESOLUTION JUDICIAL DISPUTE RESOLUTION

Parties take part in the process actively and The communication of the issues is done through
define the issues. They retain control over the the lawyers. There is lack of control of the
outcome. outcome and is dependent upon the legality of
the issues.

The parties have the opportunity to discuss the The parties have the right to represent their sides
issue from their perspective. within the limits of the law and rules. This
procedure focuses on what is legal and what
isn’t.

The discussions, negotiations and The dispute and documentation during the trial
documentation do not become part of public becomes part of the public record and the
record and hence maintains confidentiality. confidentiality and reputation of the companies
is put at stake.

The parties cannot depend upon the resolutions The parties can depend upon the precedents for
that were resorted to in similar cases as them. resolving their disputes or making their side
There is a lack of precedents in ADR as the cases stronger.
don’t become a part of public record.

The true issues of the dispute and its root cause The parties feel pressurized and face more stress
come to light as the parties are put up in a non- being a part of court proceedings.
confrontational setting.

This process maintains amicable relations or Usually, in litigation the tension between the
attempts at improving the relation between the parties becomes worse and the relationship
parties. This is important if the parties wish to worsens as all attempts are made at winning the
continue to work together in the future. suit.

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This is a win- win situation as the result of this In litigation, one party wins the suit and the other
dispute resolution mechanism is dependent on loses it causing animosity between each other.
the parties and it protects the interests of the There is no assurance if the interests of the
parties. winning part have been protected.

ADR lacks the legal authority for passing In cases where there is immediate action
injunctions. required for injunction, then the parties have the
option to approach courts for passing an
injunction order.

Due to procedural limitations, the parties don’t There a number of judicial remedies available to
have access to judicial remedies like petitions for the parties that can assist them in strengthening
additional parties, discovery of documents. their case.

The parties are able to choose the form of Once a party files a suit, the other party has to
alternate dispute mechanism which would be conform to the procedure. Both the parties must
best suitable for them. There is greater party report to the court on the dates of hearing
autonomy as the parties choose the location and decided by the court or else an ex-parte order
the time best suitable for them to resolve the may be passed.
dispute.

The procedure of dispute resolution occurs in a Litigation covers broader aspects and takes into
timely manner and relatively lesser time is taken consideration witnesses, experts. Due to the
than judicial resolution. burden on courts, litigation procedures take
longer and the case is prolonged for years.

This process is more cost effective. Since the litigation in most cases runs for years
to come, it turns out to be quite costly in the long
run.

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 If the parties reach at a mutually agreeable The decision though appealable is legally
solution then the settlement can turn into a binding on the parties and is final unless a
legally binding one. petition for appeal is filed.

With the exception of arbitration*, there can be Once a case comes to the court, then the
cases where the parties are unable to reach at a resolution that is passed is a decree and it is
settlement and hence their dispute doesn’t get legally binding and final.
resolved or there is no legally binding decision.

Most ADR procedures concern themselves with In cases where there is a need for statute
protecting the interests of the parties and interpretation or it involves a breach of law, the
reaching at a mutually agreeable decision and litigation process aims at providing an authority
hence less heed is paid to the legality of the for it.
issues.

It is ideal for those cases where the parties need It is ideal for cases where there are implications
to maintain their relation and confidentiality. for several individuals or where the parties
intend for a third party to be responsible for their
decision.

*In arbitration, the arbitrator passes an award. In case, the parties feel that the decision has not
been made correctly, then they can approach the court for challenging the award. However,
there are limited grounds for challenging such an award.

3. BENEFITS OF ADR:

• Maintains amicus relation between the parties: this is significant in the situations
where the parties intend to continue the relation after resolving the dispute.

• Convenient: the time and place of the dispute resolution is decided by the parties
themselves and hence it is quite flexible.

• Time efficient: Due to the burden of cases over the judiciary, judicial proceedings often
run for a long period of time and are dragged on for years and years. ADR ensures that
the dispute is resolved in a timely manner, it’s a speedy procedure.

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 • Protects the interest of both the parties: in ADR, unlike Judicial Dispute Resolution,
there is no winning party but the dispute is resolved with the aim to ensure that both the
parties get what the desire from the dispute resolution.

• Maintains Confidentiality: Since the law allows for media to witness judicial
proceedings as part of the public’s right to know, renowned parties are at a threat of
damaging their reputation or having their company’s secrets leak out to the public.

• Less formal: ADR procedures are usually less formal and it ventures into parties
expressing their opinions more freely.

• Party Autonomy-more control: ADR allows and guides the parties themselves to
choose a resolution that would be viable for both of them. The parties will be inclined
towards conforming to the final decisions as they played a part in reaching such a
decision (they will have greater commitment).

• Neutrality: Since both the parties decide on the mode of alternative dispute resolution
together, both the parties can expect a neutral to the law. In case, the parties are from
two different countries, then going for judicial proceedings in one country but the other
party at a disadvantage as that party is unfamiliar with the law and procedures of that
country.

• Expense is reduced: unlike litigation, ADR is not prolonged and hence the expenses
are reduced in the long run.

3.1 DISADVANTAGES OF ADR

• No guaranteed resolution: Though ADR aims for reaching at a resolution that is

convenient to both parties, the dispute between both the parties may turn out to be so
hostile that they are unable to reach at a decision that protects the interest of both the
parties. Certain parties are adamant and are unwilling to allow certain decisions.

• Arbitration awards are final: there are very few exceptions that allow for arbitral
awards to be appealed. So in case a party feels that the decision taken by the arbitrator
is unfair, it has to approach the court and prove the inadequacies for having such an
award to be set aside.

• Procedural Limitations (Loss of judicial remedies): Unlike ADR, judicial

proceedings allow for the provision of discovery which is an important aid in
determining finance related disputes.

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 • Exclusion of other parties: the dispute might involve more parties than just the ones
involved in ADR. Judicial procedures allow additional parties to be part of suit in case
the final decision affects those parties as well. In ADR, the interests of the additional
parties are disregarded.

• Protection of legal rights: while reaching at an amicable decision, the parties may
have foregone some of their legal rights.

• Unfit cases for ADR: There are limitations set to the kinds of cases which can be
brought under ADR. Criminal cases and certain civil matters cannot be resolved
through ADR. However, still there might be cases which though are not legally
prohibited to be brought under the ambit of ADR, may still be unfit for ADR as they
are unable to get the desired results through ADR processes.

Now let us study an in-depth differentiation between judicial process and 2 prominent methods
of alternative dispute redressal.

The selected differ is limited to Mediation and arbitration as, other forms of ADR having
certain similarities with mediation, which we will study further

JUDICIAL PROCESS ARBITRATION MEDIATION

This is an adjudicatory It is a quasi- judicial It is not an adjudicatory process,

1 process, where the adjudicatory process, rather is a negotiation process.

outcome is decided by a where the court appoint an A mediator facilitates the
Judge or other authority. arbitrator. process.

Relevant statutes govern, Arbitration and conciliation Statutory provision does not

2 restrict and control the act,1996 statutes govern, govern, restrict and control the
various procedures and restrict and control the various procedures and
decisions. various procedures and decisions. Thus, providing
decisions. freedom and flexibility

The parties are binding to The parties are binding to Only-begotten if the parties

3 the decision given. the Award given in reach to a mutually acceptable

arbitration.

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 agreement, the settlement is
binding.

The decision of the court The award given can be The settlement order or the

4 is appealable challenged on some decree cannot be appealed and is

specified grounds. final.

The judicial process does The arbitration also does Maximum opportunity is given

5 not give an opportunity to not give an opportunity to to the parties to communicate

communicate directly to communicate directly to the directly in presence of the
the parties. parties. mediator.

The proceedings are The proceedings are The proceedings are informal,

6 formal, follows strict formal, follow strict flexible procedures and held in
procedures and are held procedures and are held in private settings.
in public setting. private settings.

Active participation of Active participation of Active participation of parties or

7 parties or personal parties or personal personal appearance of the

appearance of the parties appearance of the parties is parties is required every time.
is not required every time. not required every time.

Judicial process focuses Arbitration process focuses Mediation process focuses on

8 on past events occurred on determines the rights the present and future and
and determines the rights and liabilities of parties and dispute is resolved by mutual
and liabilities of parties hence is adversarial in agreement irrespective of rights
and hence is adversarial nature and liabilities of the parties and
in nature is hence collaborative in nature.

4. ARBITRATION

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In this form of ADR, the dispute is settled amicably by a neutral third party known as the
arbitrator. This a less formal form of dispute resolution and at the end, the arbitrator gives his
decision in the form of an award which is final and is legally enforceable. It is a voluntary form
of ADR unless an agreement clause exists making it mandatory.

4.1 ADVANTAGES OF ARBITRATION

• Flexibility: Arbitration allows for the parties to choose the venue (location), the seat
(jurisdiction) and the date for the proceedings to take place.

• Arbitrator: The parties also choose the arbitrator on their own. They can choose to
have more number of arbitrators (oddly numbered) if they wish to. However, a large
number of arbitrators are discouraged in order to reach at decisions faster.

• Enforceability: In India, awards are legally enforceable.

• Confidentiality and expeditious procedure

4.2 DISADVANTAGES OF ARBITRATION

• Limits on Award: Unless certain special circumstances exist, in most situations

awards cannot be appealed. The judicial route has to be taken in order to have an award
set aside after proving to the court that the exceptions are applicable in that case. This
can turn out to be a very long process.

• Award not directly enforceable: In India, once the limitation period for setting aside
an award is over under the arbitration and conciliation act, 1996, then the award
becomes legally enforceable. But till the objection petition exists, the award cannot be
made legally enforceable. Other countries allow the execution of awards with subject
to judicial approval.

• Interlocutory Orders cannot be passed: The arbitrator doesn’t have the jurisdictional
power to pass interlocutory orders which prove to be fundamental in resolving certain
cases.

5. MEDIATION

In this form of ADR, there exists a neutral third party known as the mediator who ensures that
an amicable flow of conversation takes place between the parties and the mediator focuses on
understanding the dispute on a deeper level in order to present the parties with solutions. This

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is a voluntary form of dispute resolution and the parties can opt out of it in case they feel that
they are unable to reach at a decision. This form of dispute resolution is completely controlled
by the parties. In case the parties are not satisfied with the solution presented to them then they
can choose not to adhere to the final decision of the mediator. But in case they do adhere to the
decision, they must sign an agreement to ensure compliance with the decision; giving it the
affect of an arbitral award.

5.1 ADVANTAGES OF MEDIATION:

• The mediator allows for the parties to come up with a settlement on their own and hence
greater party autonomy exists.

• The parties have to adhere to the settlement only if they agree to it and the agreement
becomes binding once an agreement is signed consenting to such settlement.

• Mediation entails private meeting known as private caucus which allows parties to
maintain confidentiality while allowing the mediator to know complete information in
order to suggest a suitable solution.

• Maintains amicable relations between the parties

• Mediation resolves the dispute quickly.

5.2 DISADVANTAGES OF MEDIATION:

• There is no assurance that the mediation process will resolve the dispute since it is up
to the parties to agree to a settlement.

• There is a lack of formal procedure in mediation which can become a hurdle for
disputed parties to reach a consensus.

• The outcome of dispute resolution is dependent upon the will of the parties and not the
legality of issues.

• Not all issues of dispute will surface into discussion during mediation.

• Since it involves the parties talking and negotiating amongst each other to resolve the
dispute, it is not suitable when the relations between the parties are in a condition where
they are unable to have a conversation.

As we can conclude from the difference above their exist certain similarities between the
judicial process and Arbitration, however the Mediation technique is quite different from the

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conventional method, now let us learn how mediation differs from other mechanisms of
Alternative dispute redressal techniques.

MEDIATION CONCILIATION LOK ADALAT

It is not an adjudicatory It is not an adjudicatory It is not an adjudicatory

1 process. process. process, if established

under Legal services
authority act, section 19.

It is an adjudicatory
process, if established
under legal services
authority act, section 22B

The mediator mainly The conciliator performs a The presiding officer

2 performs a facilitative role. more active role than a mainly performs a

mediator. persuasive function.

For referring a case to For referring a case to For referring a case to Lok

3 mediation, the consent of conciliation, the consent of the Adalat, the consent of the
the parties is not mandatory parties is mandatory parties is not mandatory

The principles of order The agreement in conciliation The award in lok Adalat as

4 XXIII rule 3, CPC for is enforceable as per section 74 per section 21 of the legal
passing order or decree in of the arbitration and services authority act,
terms of the agreement is conciliation act, 1996 as a 1987 is deemed to be a
applied by the referral decree of the court. decree of the civil court.
court.

Confidentiality is given the Confidentiality is given the Confidentiality is not

5 utmost importance in utmost importance in observed in Lok Adalat.

mediation. conciliation.

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 Parties are required to be Parties are required to be Parties are not required to

6 actively as well as directly actively as well as directly be actively as well as

involved in the mediation involved in the conciliation directly involved in Lok
process process as well Adalat.

Mediation can be said as a Conciliation can also be said as However, in Lok Adalat

7 process of negotiation a process of negotiation which the scope of negotiation is

which is party centred is party centred. limited,

REFERENCES:

• https://www.tpsgc-pwgsc.gc.ca/gcc-bdm/differences-eng.html

• https://www.duffandphelps.com/insights/publications/litigation-and-disputes/what-to-
know-before-going-into-arbitration

• https://www.wipo.int/amc/en/mediation/guide/index.html#differ

• https://www.stalawfirm.com/en/blogs/view/abu-dhabi-commercial-conciliation-and-
arbitration-
center.html?utm_source=Mondaq&utm_medium=syndication&utm_campaign=Linke
dIn-integration

• https://www.lexology.com/library/detail.aspx?g=a947e053-535b-417c-8498-
2e8cc9c6cd13

• https://www.mondaq.com/india/arbitration-dispute-resolution/902142/seat-place-
venue-of-arbitration-the-saga-continues

• https://www.courts.ca.gov/3074.htm

• https://www.mondaq.com/arbitration-dispute-resolution/777618/comparative-
analysis-of-adr-methods-with-focus-on-their-advantages-and-disadvantages

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