USE OF ADR IN INDIA

Pravin Anand

Anand and Anand

APAA Workshop Hong Kong

Mahatma Gandhi

• “I realized that the true function of a lawyer was to unite parties riven asunder. The lesson was so indelibly burnt into me that a large part of my time during the twenty years of my practice as a lawyer was occupied in bringing about private compromise of hundreds of cases. I lost nothing thereby not even money; certainly not my soul”.

Chief Justice Warren E. Burger of US Supreme Court

• “The obligation of the legal profession is….to serve as healers of human conflicts…..we should provide mechanisms that can produce an acceptable result in the shortest possible time, with the least possible expense, with the minimum stress on the participants. That is what justice is all about”.

Gavin Kennedy’s “Negotiating Edge”

• Surrogate battles– Kings and their armies– Clients and their Lawyers

• Civilized Dispute Settlement mechanisms are now needed - the age of Purpleage of Purple

• Genrich Altshuller – founder of Genrich Altshuller – founder of TRIZTRIZ– Principle no 24 – Mediator –use a temporary Principle no 24 – Mediator –use a temporary

link between incompatible partieslink between incompatible parties

Article 39A– Directive Principles of State Policy

• State must secure justice

• To relieve heavy burden on courts – camps called Lok Adalats set up

• To avoid trial – motor accident claims, family etc. (civil, criminal or revenue) except non-compoundable offences

• Judicial officers or reputed persons

• No appeal except in fraud - finality

Why ADR

• Confidentiality– Problems in a typical trade secrecy case (the VF

litigation)

• Complexity – choose your judge• Cost – litigation, ad hoc arbitration institutional

arbitration ( no Five star costs), mediation free• Time – typically one or two sittings • Business opportunities – Dharampal Premchand

case - exchange of registrations (24 to 1)

Section 89 of the Civil Procedure Code (July 2002)

• Where there exist elements of a settlement;• The court shall formulate terms and give the

same to parties;• Refer the case to arbitration, conciliation, judicial

settlement, settlement through Lok Adalat or mediation.,

• Arbitration and Conciliation Act, 1996 • Lok Adalat (People’s court)– Legal Services

Authority Act, 1987.• Judicial settlement – identify a person or

institution deemed to be a Lok Adalat

Successful mediation programmes in India

Bangalore Mediation Centre – Salem Advocate Bar Association case – Mediation

Rules framed – unsuccessful – ISDLS training programme (referral Judges and

mediators)• Workshops, booklets, documentaries, mediation week

– Court Annexed mediation by trained advocate mediators – 84 persons trained

– Jan 2007 to Jan 2008 – 3079 cases referred and 53% of those mediated got settled

Delhi

• Delhi mediation centre judicial mediation – grand success

• 1193 cases decided in first year– 59% success in Tees Hazari courts– 80% success rate in Karkardooma courts– Average time 63 to 113 minutes

The IP experience

• Early cases defendant stubborn – unsuccessful– Coca Cola, Mars

• Critical to move the litigation along – damages- no adjournments, continuous trials, evidence on affidavit, (drop from 5/10 to 2/3 years) – fear that case will be decided soon changed things

• Insurance Company case – Business relationship 4.5 million USD

• Case of financial services company – Chairman Bank as a mediator – 1.75 million USD

• Colgate cases– presence of parties necessary – Judge played a role

Early Neutral Evaluation -

• Baba Masala cases • 13 cases settled by mediation• 1 case referred to ENE• Judge Kaul defined ENE in the words of Robert

A Goodin as being “a technique used in American litigation to provide early focus to complex commercial litigation, and based on that focus, provide a basis for sensible case management or offer resolution of the entire case, in the very early stages”.

Reasons for failure of mediation

• Where parties are adamant

• Fight between brothers – high egos

• Where parties wanted a judicial determination

• Where one party wanted to delay

• Where parties lacked authority

• Where parties distrusted the mediator’s authority to enforce a solution

Practical Tips

• Busy mediators may rush leading to failure

• Comfortable area with separate rooms for private meetings

• Apart from training and technique – personality of mediator

• Person with Domain knowledge may be good with royalties, rates etc (judge lower figure than banker)

Conclusion

• Refund of court fees

• Party opposing may lose right to get costs

• From Edison to iPod by Dr Frederick Mostert – you earn brownie points before a court if you made attempts to settle