Unit-I

Definition / Meaning / Concept of ADR

ADR (Alternative Dispute Resolution) refers to methods of resolving disputes outside the traditional
court system. It includes processes like mediation, arbitration, and conciliation. ADR is often faster, cost-
effective, and less formal than court procedures. It encourages parties to come to a mutually agreed
solution, making it an effective way to handle disputes, especially in civil and commercial cases. ADR
promotes peaceful resolutions while avoiding lengthy legal battles.

How ADR evolved / Evolution of ADR

The evolution of ADR in India has been significant, reflecting the country’s need for efficient, cost-
effective dispute resolution methods. Historically, India relied on traditional dispute resolution
mechanisms like Panchayats and customary laws. However, with the increasing number of cases in
courts, there was a growing recognition of the need for alternative methods. The introduction of ADR in
India was formally supported by the 1996 Arbitration and Conciliation Act, which provided a legal
framework for arbitration and conciliation. The Legal Services Authorities Act, 1987, further promoted
Lok Adalats (People’s Courts) to resolve disputes amicably.

In recent years, the Supreme Court and High Courts have actively encouraged ADR, especially through
mediation and arbitration, to decongest courtrooms. Despite its growth, ADR faces challenges such as
lack of awareness, insufficient infrastructure, and resistance from certain sections of society. However,
its integration into the legal system continues to grow, offering accessible and effective dispute
resolution alternatives.

Objectives of ADR:

1. Speedy Resolution: To provide quicker resolutions than lengthy court procedures.

2. Cost-Effectiveness: To reduce the high costs associated with litigation.

3. Access to Justice: To make dispute resolution accessible, especially for economically disadvantaged
individuals.

4. Decongestion of Courts: To ease the burden on courts by resolving cases outside the judicial system.

5. Flexibility: To offer parties more flexible and customizable solutions.

6. Preservation of Relationships: To encourage amicable settlements, especially in family and business

7. Confidentiality: To ensure that the process remains private and disputes are not publicly exposed.
Mini Trial :

A mini-trial is an alternative dispute resolution method where parties present their case to a panel
comprising senior representatives from both sides and a neutral advisor. It is informal and focuses on
key issues. The panel evaluates the case and facilitates negotiation. It helps resolve disputes efficiently,
saving time and costs compared to full litigation.

Different / Various / Kinds / Types of ADR Processes

The main ADR processes in India include arbitration, mediation, conciliation, and negotiation.

• Arbitration involves appointing a neutral third party (arbitrator) to resolve a dispute. The arbitrator’s
decision is binding.

• Mediation is a process where a neutral mediator helps parties reach a voluntary agreement.

• Conciliation is similar to mediation but the conciliator plays a more active role in suggesting solutions.

• Negotiation is a direct discussion between parties to settle the dispute without third-party
involvement.

Among these, mediation is often considered the best in the Indian legal system due to its informal
nature, cost-effectiveness, and ability to preserve relationships. It encourages mutual understanding,
flexibility, and a quicker resolution, making it highly suitable for the diverse socio-cultural context of
India.

Advantages of ADR

1. Faster Resolution: ADR processes are quicker than lengthy court trials.

2. Cost-Effective: ADR reduces legal and court-related expenses.

3. Confidentiality: ADR keeps disputes private, unlike public court proceedings.

4. Flexibility: ADR offers more flexible solutions and procedures.

5. Control: Parties have more control over the outcome.

6. Preservation of Relationships: ADR promotes cooperation, helping maintain amicable relations.

7. Less Formal: The process is less rigid and more informal.

Disadvantages of ADR:

1. Non-Binding Decisions: Some ADR processes, like mediation, may not result in binding outcomes.

2. Power Imbalance: Disparities in power between parties can lead to unfair resolutions.

3. Limited Applicability: ADR may not be suitable for complex or large disputes.

4. Lack of Legal Precedent: ADR outcomes do not create binding legal precedents.

5. Awareness Issues: Many individuals are unaware of ADR options.

ADR in family disputes focuses on resolving issues like divorce, child custody, and property through
mediation, conciliation, or arbitration. It promotes amicable solutions, preserves relationships, and
reduces stress. ADR in family matters is cost-effective, faster, and more private compared to litigation,
helping maintain family harmony and avoiding lengthy court procedures.

Scope of ADR

The scope of ADR in India is growing across civil, commercial, family, and labor disputes. It provides
quicker, cost-effective resolutions, reducing court congestion. ADR methods like arbitration, mediation,
and conciliation are increasingly recognized for their efficiency and effectiveness in resolving conflicts.

Mediation

Mediation is a voluntary process where a neutral third party, the mediator, helps disputing parties
communicate and negotiate to reach a mutually agreeable settlement. The mediator does not make
decisions or impose solutions, but facilitates dialogue.

Rules to be Followed in Mediation:

1. Voluntary Participation: Parties must consent to mediation and can withdraw anytime.

2. Confidentiality: All discussions during mediation are private and cannot be used in court.

3. Neutrality: The mediator must remain impartial, not taking sides.

4. Self-Determination: Parties retain control over the outcome, reaching a mutually agreed solution.

5. Respect: Both parties should be treated equally and respectfully.

Advantages of Mediation:

1. Cost-Effective: Lower expenses compared to litigation.

2. Faster Resolution: Quicker than court proceedings.

3. Confidentiality: Privacy is maintained.

4. Flexibility: Adaptable to the needs of the parties.

5. Preservation of Relationships: Encourages cooperation and maintains relationships.

1. Role of Third Party: In mediation, the mediator helps facilitate settlement; in arbitration, the
arbitrator makes a binding decision.

2. Outcome: Mediation results in a non-binding agreement, while arbitration leads to a binding award.

3. Formality: Mediation is informal, while arbitration is more formal, resembling a court hearing.

4. Voluntariness: Mediation is voluntary, whereas arbitration is usually binding once agreed upon by the
parties.

Conciliation:

Conciliation is an ADR process where a neutral third party, called the conciliator, helps disputing parties
communicate and negotiate. The conciliator actively proposes solutions and assists the parties in
resolving their dispute. However, the final decision rests with the parties, and the conciliator’s
suggestions are non-binding.

Negotiation:

Negotiation is an informal process where the parties involved in a dispute directly communicate with
each other to reach a mutually acceptable agreement. No third party is involved, and the outcome
depends on the willingness of the parties to compromise and settle the matter.

Difference between Conciliation and Negotiation

1. Third Party Involvement:

• Conciliation: A third party (conciliator) is actively involved.

• Negotiation: No third party; parties negotiate directly.

2. Role of Third Party:

• Conciliation: The conciliator suggests solutions.

• Negotiation: The parties themselves determine solutions.

3. Formality:

• Conciliation: More structured than negotiation.

• Negotiation: Informal and flexible.

4. Outcome:

• Conciliation: The conciliator’s suggestions are non-binding.

• Negotiation: The result depends entirely on the parties’ agreement.

1. Third-Party Involvement:

• Mediation: A neutral third party (mediator) facilitates discussions.

• Negotiation: No third party; parties negotiate directly.

2. Role of Third Party:

• Mediation: Mediator helps guide and suggest solutions but does not impose decisions.

• Negotiation: Parties themselves control the process and outcome.

3. Formality:

• Mediation: More formal, with structured procedures.

• Negotiation: Informal and flexible.

4. Outcome:

• Mediation: Results in a voluntary agreement, not binding unless formalized.

• Negotiation: Parties reach an agreement without external intervention.

5. Scope:

• Mediation: Suitable for complex disputes needing facilitation.

• Negotiation: Best for simpler disputes resolved directly.