National Mediation Bill 2021
In India, the National Mediation Bill 2021 was introduced in the Rajya Sabha on 20th December 2021. While it is yet to become an Act, we take a look at key aspects of the Mediation Bill.
Mediation is a form of alternate dispute resolution (ADR). Through mediation, parties endeavour to settle their disputes without going to court(s). Dispute settlement is done through mutual discussion and dialogue through representatives of parties. A third person is appointed as mediator to settle the matter amicably. The objective being to resolve disputes in time and cost-effective manner.
Process of Mediation
Usually, mediation is voluntary – opted between parties. A mediation clause may be present in an agreement / contract between parties. However, the Court in the course of its proceedings may also direct the parties to go through mediation. Besides, there are legislations which have built in provisions for mediation between parties.
The need for legislation
Several countries have enacted exclusive laws relating to mediation. In 2019, the Hon’ble Supreme Court made a recommendation to the government to enact a standalone legislation in India. A committee established by the Apex Court in 2020 submitted a draft of the Mediation legislation. Introduced in the Rajya Sabha, the Bill is presently referred to the Parliamentary Standing Committee and awaits finalization.
The National Mediation Bill 2021
The Bill seeks to promote and facilitate with focus on institutional mediation and online mediation for resolution of commercial and other disputes, enforce mediated settlement/ settlement agreements, provide statutory recognition to mediators while ensuring mediation is cost effective.
- All mediation proceedings in India where all parties reside / are incorporated / have place of business in India; OR
- Where the agreement states that the mediation will be as per this Bill / Act; OR
- Mediation related to commercial dispute resolution where at least one party is a foreign government / foreign national / resident / entity with its place of business outside India
Clarity is sought on enforceability in India, of settlement agreements when one of the parties in Indian and the mediation is conducted abroad.
- Relating to claims against minors or persons of unsound min “ 2d,
- Involving prosecution for criminal offences,
- Affecting the rights of third parties, and
- Relating to levy or collection of taxes.
The Bill states that the Central government has the power to amend this list of disputes.
- Pre litigation mediation is mandatory in case of civil or commercial disputes. Parties must try to mediate first and only if they fail, approach Court(s)
- Mediators can be appointed either by Parties or by any mediation service provider such as institution administering mediation.
- Mediation process shall be kept confidential.
- Mediation process must be completed within 180 days extendable by a maximum of another 180 days.
- Mediation process may be withdrawn after 2 sessions.
- If the mediation is conducted in any centre established by the Court / Tribunal, then the proceedings must be conducted in accordance with rules framed by High Court(s) / Supreme Court
- Settlement agreements must be in writing, signed by both parties and authenticated by mediator. Such agreements are final, binding and enforceable by Courts.
Making pre litigation a mandatory step may actually lengthen the process of litigation.
Further, it may impose it on parties who would prefer litigation to ADR.
It should be mandated that Mediators must possess requisite experience besides qualification to undertake mediation.
Mediation Council of India
- The Central government shall have to power to establish the Mediation Council of India.
- Such council shall comprise of a Chairman, 2 full time members, 3 Ex-officio members and 1 part time member;
- The council shall be responsible for registration of mediators, recognize mediation service providers and institutes responsible for education, training and certificate of mediators.
- Mediation can be conducted online at any stage of mediation (including pre -litigation mediation) with written consent of parties in the manner and mode specified in the Bill.
- Confidentiality shall be ensured in online mediation as well.
Any dispute likely to affect peace, harmony and tranquility amongst the residents or families of any area or locality may be settled through community mediation with prior mutual consent of the parties to the dispute.
Mediation: The Future? Or the Future of mediation?
As an Alternate dispute resolution (ADR) mechanism, Mediation has steadily gained prominence and relevance in the legal fraternity. With several countries enacting their own stand-alone mediation laws, India also enacted an exclusive law on mediation. There are grey areas in the draft legislations which are being looked into and deliberated by the Parliamentary Standing Committee. A National Mediation Act may soon be in place.