UNIT-3

ARBITRATION, TRIBUNAL
ADJUDICATION AND
ALTERNANTE DISPUTE RESOLUTION
 A. Adversarial and Inquisitorial Systems
In an adversarial system,
• the parties in a legal proceeding develop their own theory of the case and gather evidence to support their
claims.
• The parties are assisted by their lawyers who take a pro-active role in delivering justice to the litigants.
• The lawyers gather evidence and even participate in cross-examination and scrutiny of evidence presented by
the other disputing party.
• The role of the judge/decision maker is rather passive as the judge decides the claims based solely on the
evidences and arguments presented by the parties and their lawyers.

In an inquisitorial system,
• the judge/decision maker takes a centre-stage in dispensing justice.
• The role of the judge/decision maker is active as he/she determines the facts and issues in dispute.
• The judge/decision maker also decides the manner in which the evidence must be presented before the
court.
• For example, the judge may decide for presentation of a specific form of evidence, i.e. oral (witness
statement) or documentary (correspondence between the parties through letters/emails) or a combination
of both.
• The judge then evaluates the evidence presented before him/her and decides upon the legal claims.
• Therefore, this model of adjudication is also known as the interventionist/investigative model. Furthermore, in
such a system, less reliance is placed on cross-examination and other techniques often used by lawyers to
evaluate evidences of their opposing counsel.
The main advantages of an adversarial system include:
 The use of cross-examination can be an effective way to test the credibility of witnesses presented;
 The parties may be more willing to accept the results when they are given effective control over the process.

The disadvantages of an adversarial system are the following:

 The cost of the justice system falls upon the parties. This creates an in-built discrimination amongst the
litigants. Parties with better resources are able to access justice by hiring competent lawyers and presenting
sophisticated evidences which may not be immediately available for parties that lack these resources.
Accessibility and affordability to justice are important challenges for the adversarial system of dispute
resolution.
 The role of lawyers and the procedural formalities, e.g. cross examination may prolong the trial and lead to
delays in several matters. Judges play less active role;
 a judge is not duty bound to ascertain the truth but only to evaluate the matter based on the evidences
presented before him/her.
On the other hand, the advantages of an inquisitorial model include:
 The system offers procedural efficiency as the active role of judges prevents delays and
prolonged trials.
 The system preserves equality between the parties as even the stronger party with more
resources and expert lawyers may not be able to influence the judges.

The disadvantages of this model include:

 In an inquisitorial system, since the judge steps into the shoes of an investigator, he/she can
no longer remain neutral to evaluate the case with an open mind.
 There may be a lack of an incentive structure for judges to involve themselves in proper fact
finding
 B. Introduction to Alternative Dispute Resolution

Meaning and Scope:

• Alternative Dispute Resolution (ADR) system refers to the use of non-adversarial

techniques of adjudication of legal disputes.

Benefits of ADR
1. The ADR methods are speedier, informal and cheaper modes of dispensing justice when
compared to the conventional judicial procedure.
2. ADR provides a more convenient forum to the parties who can choose the time, place
and procedure, for conducting the preferred dispute redressal process.
3. Furthermore, if the dispute is technical in nature, parties have an opportunity to select
the expert who possesses the relevant legal and technical expertise.
4. It is interesting to note that ADR provides the flexibility to even refer disputes to non-
lawyers. For example, several disputes of technical character e.g. disputes pertaining to
the regulation of the construction industry are usually referred to engineers rather
than lawyers.
ADR is also encouraged amongst the disputants to reduce delays and high pendency of court
cases.

The rise of ADR is further supported, as the law courts are confronted with following problems,
such as:
1. The lack of number of courts and judges which creates an inadequacy within the justice
delivery system;
2. The increasing litigation in India due to increasing population, complexity of laws and
obsolete continuation of some pre-existing legal statutes;
3. The increasing cost of litigation in prosecuting or defending a case, increasing court fees,
lawyer·s fees and incidental expenses;
4. Delay in disposal of cases resulting in huge pendency in all the courts.
 C.Types of ADR

Arbitration
Meaning:
Arbitration is a term derived from the nomenclature of Roman law. Arbitration is a private
arrangement of taking disputes to a less adversarial, less formal and more flexible forum and
abiding by judgment of a selected person instead of carrying it to the established courts of
justice.
 Process of arbitration
 Arbitration can be chosen by the parties either by way of an agreement (Arbitration Agreement) or
through the reference of the Court (Court Referral of Arbitration- See Glossary).
 The parties in an arbitration have the freedom to select a qualified expert known as an arbitrator.
 The process of dispute resolution through arbitration is confidential, unlike the court proceedings which
are open to the public. This feature of arbitration makes it popular especially for commercial disputes where
business secrets revealed during the process of dispute resolution are protected and preserved. Similarly
companies can maintain their commercial reputation, as they can prevent the general public or their
customers from discovering the details of their on-going legal disputes.
 The decision rendered by an arbitrator is known as an arbitral award. Similar to a judgment given by a judge,
the arbitral award is binding on the disputing parties.
 Once an arbitral award is rendered, it is recognised and enforced (given effect to) akin to a court
pronounced judgment or order.
 In addition to an arbitral award, the arbitrator also holds power and authority to grant interim measures,
like a judge in the court.
 These interim measures are in the nature of a temporary relief and may be granted while the legal
proceedings are on-going in order to preserve and protect certain rights of the parties, till the final award is
rendered.
 Therefore, an arbitral award holds several similarities with a court order or judgment. However, unlike a
judgment rendered by a judge in the court, the award does not hold precedential value
 Types of Arbitration

1. Domestic Arbitration - An arbitration with Indian parties, where the place of arbitration is in India and rules
applicable are Indian.
2. Foreign Arbitration - An arbitration where proceedings are conducted in a place outside India and the award is
required to be enforced in India.
3. Ad-hoc Arbitration - An arbitration which is governed by parties themselves, without recourse to a formal
arbitral institution. It may be domestic or international in character.
4. Institutional Arbitration - An arbitration where parties select a particular institution, which in turn takes the
arbitration forward by selecting an arbitrator and laying out the rules applicable within an arbitration, e.g., mode
of obtaining evidence, etc. There are several institutions to govern arbitration. Examples of prominent
institutions of arbitration include, The London Chamber of International Arbitration (LCIA) which has its
offices across the world, including New-Delhi, India.
5. Statutory Arbitration - An arbitration which is mandatorily imposed on the parties by operation of a particular
law or statute, applicable to them. For example, the Defence of India Act, 1971 is one such legislation that
mandates a recourse to arbitration in case of any dispute arising within the Act.
6. International Commercial Arbitration - An arbitration in which at-least one of the disputing parties is a
resident/body corporate of a country other than India. Arbitration with the government of a foreign country is
also considered to be an international commercial arbitration. This form of arbitration has been defined
specifically under section 2(1)(f) of the Arbitration and Conciliation Act, 1996.
An overview of the laws on arbitration
 The Arbitration and Conciliation Act of 1996 is the relevant legislation that governs the process of arbitration
in India.
 The statute provides for an elaborate codified recognition of the concept of arbitration, which has largely been
influenced by significant movements of judicial reforms and conflict management across the world.
 In this regard, a special reference must be made to an international convention entitled, United Nations
Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration,
1985.
 After the birth of this international treaty, the United Nations General Assembly, recommended that all
countries must give due consideration to the said Model law, in-order to bring uniformity in the law and
practice of international arbitration. The Indian Arbitration and Conciliation Act of 1996 is similarly modelled
on the UNCITRAL model law.
 The Arbitration and Conciliation Act, 1996 has ushered a new era of dispute resolution for domestic and
commercial legal issues. On these lines, the Supreme Court of India has also affirmed that the Arbitration and
Conciliation Act, 1996 was introduced in order to attract the 'international mercantile community'.
 The Supreme Court has thus emphasised that the Act should be interpreted and applied, keeping the
commercial sense of the dispute in mind (Konkan Railways Corp. Ltd. v. Mehul Construction Co. (2000) 7 SCC
201).
 Administrative Tribunals
• The 42 Amendment Act, 1976 added Articles 323-A and 323-B to the Constitution of India.
• These articles empower the Parliament to set up tribunals for adjudication of specialised disputes.
• The range of disputes mentioned in the Constitution refers to:
a) disputes pertaining to service conditions of the government officers,
b) collection and enforcement of tax,
c) industrial and labour disputes,
d) matters concerning land reforms,
e) elections disputes,
f) ceiling on urban property and production, procurement, supply and distribution of food-stuffs or other 2
essential goods.

• Thus the 42 Amendment Act ushered the era of tribunalisation of Indian judiciary·.
• Further, the enactment of Administrative Tribunals Act, 1985 took the constitutional objective further and set-
up the Central Administrative Tribunal (CAT) and State Administrative Tribunals.
• The CAT was set up pursuant to the Act of the Legislature in 1985. The tribunals exercise jurisdiction of
service matters of employees covered by it. The appeals against the orders of the administrative tribunals lie
before the Division bench of the concerned High Court.
 Mediation
Mediation:
• Mediation is a method of ADR in which parties appoint a neutral third party who facilitates
the mediation process in-order to assist the parties in achieving an acceptable, voluntary
agreement.
• Mediation is premised on the voluntary will of the parties and is a flexible and informal
technique of dispute resolution.
• Mediation is more formal than negotiation but less formal than arbitration or litigation.
• Unlike litigation and similar to arbitration, mediation is relatively inexpensive, fast, and
confidential.
• Further, mediation and arbitration differ on the grounds of the nature of an award rendered.
The outcome of mediation does not have similar binding like an arbitral award. However,
though non-binding, these resolution agreements may be incorporated into a legally binding
contract, which is binding on the parties who execute the contract.
 Mediation can be classified into the following categories:

1. Evaluative mediation –
• Evaluative mediation is focused on providing the parties with an evaluation of their case and directing them toward settlement.
• During an evaluative mediation process, when the parties agree that the mediator should do so, the mediator will express
a view on what might be a fair or reasonable settlement.
• The Evaluative mediator has somewhat of an advisory role in that s/he evaluates the strengths and weaknesses of each
side's argument and makes some predictions about what would happen should they go to court.

2. Facilitative mediation –
• Facilitative mediators typically do not evaluate a case or direct the parties to a particular settlement. Instead, the
Facilitative mediator facilitates the conversation.
• These mediators act as guardian of the process, not the content or the outcome.
• During a facilitative mediation session the parties in dispute control both what will be discussed and how their issues will
be resolved.
• Unlike the transformative mediator, the facilitative mediator is focused on helping the parties find a resolution to their
dispute.
• The facilitative mediator further provides a structure and agenda for the discussion.
Transformative mediation –
• Transformative mediation practice is focused on supporting empowerment and
recognition shifts, by allowing and encouraging deliberation, decision-making,
and perspective-taking.
• A competent transformative mediator practices with a micro-focus on communication,
identifying opportunities for empowerment and recognition as those opportunities appear
in the parties' own conversations, and responding in ways that provide an opening for
parties to choose what, if anything, to do with them.

Mediation with arbitration –

• Mediation has sometimes been utilized to good effect when coupled with arbitration,
particularly binding arbitration, in a process called 'mediation/arbitration'.
• The process begins as a standard mediation, but if mediation fails, the mediator becomes
an arbiter.
• This process is more appropriate in civil matters where rules of evidence or jurisdiction
are not in dispute. It resembles, in some respects, criminal plea bargaining and Confucian
judicial procedure, wherein the judge also plays the role of prosecutor.
Online Mediation- Online mediation employs online technology to provide disputants access to mediators and each other
despite geographic distance, disability or other barriers to direct meeting.
 Process of Mediation
 The neutral third party facilitating the process of mediation is known as a mediator.
 Mediation does not follow a uniform set of rules, though mediators typically set forth rules that the mediation will
observe at the outset of the process.
 Successful mediation often reflects not only the parties· willingness to participate but also the mediator·s skill.
 There is no uniform set of rules for mediators to become licensed, and rules vary by state regarding requirements
for mediator certification.

 Broadly speaking, mediation may be triggered in three ways:

(i) Parties may agree to resolve their claims through a pre-agreed mediation agreement without initiating formal
judicial proceedings (pre-litigation mediation).
(ii) Parties may agree to mediate, at the beginning of formal court proceedings (popularly known as court referrals).
(iii) Mediation may be taken recourse of, after formal court proceedings have started, or even post trial, i.e. at the
appellate stage.
Under the Indian law, contractual dispute (including money claims), similar disputes arising from strained relationships (from matrimonial
to partnership), disputes which need a continuity of relationship (neighbour·s easement rights) and consumer disputes, have been held to
be most suited for mediation.
 Conciliation
Meaning:
• Conciliation is a process similar to mediation as parties out of their own free will appoint a neutral third party to resolve
their disputes.
• The key difference between mediation and conciliation lies in the role of the neutral third party.
• A mediator merely performs a facilitative role and provides platform for the parties to reach a mutually agreeable solution.
The role of a conciliator goes beyond that of a mediator. A conciliator may be interventionist in the sense that he/she may
suggest potential solutions to the parties, in-order to resolve their claims and disputes.

• Laws on Mediation and Conciliation Both Mediation and Conciliation are governed by Section 89, a provision inserted by
the 2002 amendment of the Civil Procedure Code, 1908 . The Code is the primary legislation governing the method,
procedure and legal practice of civil disputes. Section 89 of the Code only deals with court referred mediation.
Prelitigation mediation is not yet governed by any law in India. Similarly, conciliation only finds a reference in Section 89,
Civil Procedure Code, 1908. The process and methods within conciliation have been described in the Arbitration &
Conciliation Act, 1996. Further, the Industrial Disputes Act, 1947 also provides for conciliation as a viable means of
resolving disputes in the labour sector.
 E. Lok Adalat

• The concept of Lok Adalat (People·s Court) is an innovative Indian contribution to the global
legal jurisprudence.
• The institution of Lok Adalat in India, as the very name suggests, means, People's Court."Lok"
stands for "people" and the term "Adalat" means court.
• India has a long tradition and history of such methods being practiced in the society at grass
roots level.
• In ancient times the disputes were referred to ´panchayats’ which were established at village
level. Panchayats used to resolve the dispute through arbitration. It has proved to be a very
effective alternative to litigation. This very concept of settlement of dispute through
mediation, negotiation or through arbitral process known as decision of "Nyaya-
Panchayat" is conceptualized and institutionalized in the philosophy of Lok Adalat. It
involves people who are directly or indirectly affected by dispute resolution. The evolution of
movement called Lok Adalat was a part of the strategy to relieve heavy burden on the
Courts with pending cases and to give relief to the litigants who were in a queue to get
justice.
• The modern institution of Lok Adalat is presided over by a sitting or retired judicial officer such as the
chairman, with usually two other members- a lawyer and a social worker.
• A Lok Adalat has jurisdiction to settle any matter pending before any court, as well as matters at pre-litigative
stage, i.e. disputes which have not yet been formally instituted in any Court of Law.
• Such matters may be in the nature of civil or non compoundable criminal disputes.
• The salient features of Lok Adalat are participation, accommodation, fairness, voluntariness, neighbourliness,
transparency, efficiency and lack of animosity.

The benefits of Lok Adalat include:

1. There is no court fee and even if the case is already filed in the regular court, the fee paid will be refunded if
the dispute is settled at the Lok Adalat.
2. There is no strict application of the procedural laws and the disputing parties can directly interact with the
judges.
3. The decision of Lok Adalat is binding on the parties and its order is capable of execution through legal
process.
 An overview of laws on Lok Adalat

• Pursuant to Article 39-A of the Constitution of India, the Parliament has enacted The Legal
Services Authorities Act, 1987. The Act provides for various provisions of dispute settlement
through Lok Adalat.
• The Act constitutes legal services authorities to provide free legal aid and competent legal
services to the weaker sections of the society.
• In 2002, the Act was amended to establish permanent Lok Adalats for public utility services.
• Furthermore, the National Legal Services Authority (NALSA), a statutory body constituted
under the National Legal Services Authorities Act, 1987 is responsible for laying down
policies and principles for making legal services under the Act and frame the most effective
and economical schemes for legal services.
• NALSA is engaged in providing legal services, legal aid and speedy justice through Lok
Adalats.
• It also disburses funds and grants for implementing legal aid schemes, literacy camps and
programs. Similarly, the State Legal Services Authorities and District Legal Services
Authorities have been constituted in every state capital and districts respectively.
 F. Ombudsman

 Whether appointed by a legislature, the executive, or an organization, the typical duties of

an ombudsman are to investigate complaints and attempt to resolve them, usually through
recommendations (binding or not) or mediation.
 Ombudsmen sometimes also aim to identify systemic issues leading to poor service or
breaches of people's rights.
 At the national level, most ombudsmen have a wide mandate to deal with the entire public
sector, and sometimes also elements of the private sector (for example, contracted service
providers).
 Further redress depends on the laws of the country concerned, but this typically involves
financial compensation.
 The Government of India has designated several ombudsmen (sometimes called Chief
Vigilance Officer (CVO)) for the redress of grievances and complaints from individuals in
the banking, insurance and other sectors being serviced by both private and public bodies
and corporations.
 The major advantage of an ombudsman is that he or she examines complaints from outside the offending state institution,
thus avoiding the conflicts of interest inherent in self-policing. However, the ombudsman system relies heavily on the
selection of an appropriate individual for the office, and on the cooperation of at least some effective official from within
the apparatus of the state.
 G. Lokpal and Lokayukta
Meaning and Origin
A Lokpal (caretaker of people) is an ombudsman in India.
The Lokayukta (appointed by the people) is a similar anti-corruption ombudsman
organization in the Indian states.
 The institutions of Lokpal and Lokayukta were given formal recognition by the passing of
The Lokpal and Lokayukta Act, 2013.
The legislation aims to combat acts of bribery and corruption of public-servants a
term that has been given a fairly wide interpretation in the Act.
The Act applies to the public servants in and outside India.
 It is important to note that the Act includes in its purview even the current and ex-prime
ministers of India except in matters pertaining to international relations, external and
internal security, public order, atomic energy and space.
 At least two-thirds of the members of Lokpal must approve of such inquiry. It further
provides that any such inquiry shall be held in camera and if the Lokpal comes to the
conclusion that the complaint deserves to be dismissed, the records of the inquiry shall not
be published or made available to anyone.
Besides the Prime Minister, it brings within its purview any person who is or
has been a Minister of the Union and any person who is or has been a Member
of either House of Parliament.
The Lokpal shall not inquire into any matter involved in, or arising from, or
connected with, any such allegation of corruption against any Member of either
House of Parliament in respect of anything said or a vote given by him/her in
Parliament or any committee thereof covered under the provisions contained
in clause (2) of Article 105 of the Constitution.
The Act also provides for the manner in which the public-servants must
declare their assets.
According to the Act, the Lokpal shall consist of:
 A chairperson who has been a Chief Justice of India or is or has been a Judge of the Supreme Court or is an eminent
judicial member of impeccable integrity and outstanding ability having special knowledge and expertise of not less than
25 years in matters relating to anti-corruption policy, public administration, vigilance or finance. Further, the total
members of Lokpal shall not exceed 8, out of whom 50% shall be Judicial Members.
 Furthermore, the powers of the Lokpal are extensive, and equivalent to the superintendence, inquiry and investigative
powers of the police and the Central Vigilance Commission.

• The Lokpal shall consist of an inquiry and prosecution wing to take necessary steps in prosecution of public servants in
relation to offences committed under the Prevention of Corruption Act, 1988.
• Further, Lokpal can even recommend the government to create special courts to decide cases arising from the
Prevention of Corruption Act, 1988.

• Likewise, the Lokpal and Lokayuktas Act, 2013 provides for the establishment of Lokayukta at every state in-order to
deal with complaints of corruption against public functionaries. The Act provides that all states must institute Lokayuktas
within one year of from the date of the commencement of The Lokpal and Lokayuktas Act, 2013.