ADRS - 4th Sem
ADRS - 4th Sem
conclusion:
Globalisation has abridged the world through
business connections. Disputes are often their
byproducts too. Hence a uniform law for
settlement of international commercial
disputes. Since ADRS works on mutual consent
basis, it is resorted to by most of the countries.
…...END of UNIT-1…....
UNIT - 2
ARBITRATION.
Arbitration is reference of a dispute (between
parties) to the decision of one or more
arbitrators.
Arbitration agreement is essential for
reference of a dispute to arbitration.
Arbitration council.
The Act has introduced the concept of an
Arbitration Council of India. It is established
by Central government.
Definitions:
Arbitration.
Section 2-1-a.
arbitration means any arbitration , whether
or not administered by an arbitrator,
appointed specially for the settlement of a
particular dispute, or by some permanent
arbitration institution.
Arbitration agreement.
Section 2-1-b .
..means an agreement by the parties, to
submit to arbitration, all or certain disputes
which have arisen, or which may arise
between them, in respect of a defined legal
relationship, whether contractual or not.
A non contractual relationship, may arise
from tort. Example ; finder of lost goods.
Arbitral award.
Section 2-1-c.
Arbitral award is the final stage of arbitration
proceedings, and it is the judgment of the
arbitral proceedings. It is in fact a final
adjudication, by a tribunal of the parties own
choice. It is binding in the same manner, as
the decision of a court. It includes interim
award.
Essentials of arbitration:
1. Parties.
2. Arbitration agreement.
There must be an arbitration agreement. It is
an agreement by the parties, to submit to
arbitration.
Such agreement must, either contain an
arbitration clause in the general contract, or
may be a separate agreement. It must be in
writing, and signed by the parties, or through
exchange of letters, telex, telegrams etc.
3. Dispute or difference.
The dispute arise from legal transaction only.
Though an arbitration agreement may
provide for, reference of a present or future
dispute to arbitration , it is essential that
there should be existing dispute, for
reference to arbitration.
The provision of reference of future disputes
to arbitration, merely constitutes " arbitration
clause ", but not actual arbitration.
Attributes of arbitration.
page 98.
Main attribute is agreement between parties.
The agreement must clearly state that the
award will be binding on the parties.
Principles of Arbitration.
page 99.
1. Principle of transparency.
2. Fairness and impartiality.
3. Fair hearing and reasonable opportunity.
4. Fair means of resolution of dispute.
Domestic arbitration.
Arbitration takes place in india. The subject
matter of contract is in india. The merits of
the dispute are governed by Indian law.
Procedure is governed by Arbitration and
Conciliation Act, 1996.
International arbitration:
Section 2-1-f : the arbitration relating to
disputes arising out of legal relationships,
whether contractual or not, where at least
one of the parties is :
an individual who is a national of , or
habitually residing other than india.
A corporate body incorporated in other than
india;
A company or an association or a body of
individuals whose control and management is
exercised from outside india.
The government of foreign country.
Advantages of arbitration:
Arbitration proceedings are held in private. So
confidentiality is maintained.
Since it is informal simple procedure.
No appeal, award is enforceable immediately.
Inexpensive.
Saves time, money. No lengthy proceedings.
In technical matters as arbitrator is
technically qualified, award is better than tht
of a civil court judge.
since there is consent by both parties, award
becomes final and enforceable.
Disadvantages:
Arbitrator may not be Legally not qualified.
High probability of injustice creep in.
Matters referable:
Determination of quantum of damages in
case of breach of contracts.
Disputes in accounts.
Contracts of assignment.
Arbitration Agreement.
page 148
Section 7 and 8 deals with agreement.
Section 7: An agreement by the parties to
submit to arbitration all or certain disputes
which have arisen or which may arise
between them in respect of a defined
relationship , whether contractual or not "
Act envisages that without an agreement no
dispute can be referred to Arbitration.
Doctrine of Mutuality.
page 155
An arbitration agreement relating to
contingent contract is not permissible under
the Arbitration Act, as it is not based on
mutuality.
An arbitration clause which give only one
party the option to arbitrate and binds only
one of the parties is not valid, as there is no
mutuality.
if one party alone is empowered to appoint
the arbitrator, such arbitration clause is VALID
as there is also mutuality in that one is
empowered by the other to appoint
arbitrator,
Example: IN government contracts the
government officials has the right to appoint
arbitrator, and since other party agrees to
such condition, the contract is valid.
Removal of arbitrator.
page 207.
Section 12: provides the grounds on which
appointment of an Arbitrator can be
challenged by a parties to arbitration.
Arbitral Tribunal.
page 216.
It shall exercise its authority within the terms
of reference of disputes.
The arbitration clause in the contract is
independent of terms of contract. So even if
the contract become void, it does not ipso
jure invalidate the arbitration agreement.
The tribunal may have its own rules or
proceedings provided it do not vitiate the
terms of refernce of arbitration.
The arbitrators can not question the validity
of the arbitration agreement itself.
Making of Award.
page 255.
Present Act has encouraged voluntary
settlement of disputes even during the
pendency of disputes before arbitration and
even in such settlement the arbitrator is
empowered to pass awrards whch has the
same effect and status as any other arbitral
award.
Award must state the reasons for the
decision.
Arbitral tribunal is empowered to levy
interest and cost.
For domestic arbitration the substantive law
of india is applicable.
Though as regards the procedure of
arbitration, the arbitrator can with the
consent of the parties , apply agreed rules of
their own, but as regards the substantive
portion of the disputes still the Indian
substantive laws like Indian Contract Act,
Partnership Act, sale of goods act, are
applicable.
Panel of arbitrators.
Section 29.
if more than one arbitrator then decision by
majority.
The interim orders are not arbitral awards,
but they are only arbitral decisions and they
need not be in writing nor be signed by
arbitrators.
The present act does not allow even number
of arbitrators hence majority is possible.
In case each party appoints one arbitrator,
then the two arbitrators must appoint the
third arbitrator called Presiding Arbitrator.
The presiding arbitrator is not an umpire as
under the old act. Here only majority decision
prevails.
All the arbitrators must execute the award at
the same time and place, though the decision
may be different.
Modification of award.
The tribunal has the power to modify even
after award is passed. But such modification
is the discretionary power of the tribunal and
must be based on sufficient reasons for such
modification.
When once the arbitral award is made in a
dispute, for the same dispute, there cannot
be another arbitrary proceedings. That is
proceeding is barred by the doctrine of res
judicata.
On making the arbitral award the arbitral
proceedings is terminated and the arbitral
tribunal passes an order to this effect.
Enforcement of award.
page 301.
Under the Arbitration Act, 1940, an award
could not be directly enforced. But only
through the decree of a civil court.
But the present Act, 1996 has allievated all
this anomaly.
The time limit for setting aside an award is
three months.
once this time limit expired, then the party in
whose favour the award is passed can directly
enforece the award under the Code of Civil
Procedure, 1908 in the same manner, as if it
were a decree of the court.
The supreme court in a case held that, for the
works executed in india and the award passed
and delivered in London, but still on the basis
of the award , it could be directly enforced in
Bombay.
In mattapally chellamaya Vs. Mattappally
venkataraman, it was held that an award
could be enforced in part.
Kinds of conciliation.
Facilitative conciliation.
conciliator merely facilitates, do not give his
opinion.
helps parties overcome differences and find
solution.
since the relationship of parties at odds
changes due to conciliation , this is called
transformative approach.
this type applied in labour disputes.
Evaluative .
conciliator gives his opinion on the merrits of
the issues.
His opinion is like that of a third party and so
may not be binding.
plus and minus of each partys arguments is
analysed.
this type is only advisory.
Court Annexed conciliation.
conciliatory service is provided by court.
The judges,lawyers and parties become
participants.
It is as if he judge refer the case to a
mediator.
Resolution is under the supervision of the
judeges so it is more coordinated.
Voluntary conciliation.
parties are free to use conciliation.
Both parties refer the disput for conciliation.
Parties are free to accept or reject decision.
Compulsory conciliation.
The dispute is referred to board of
conciliation, where the procedure is made
compulsory.
if voluntary useless then compulsory is made
use of.
in cases where parties reluctant to meet each
other, compulsory conciliation is useful.
Qualities of a conciliator.
quality must to win trust and confidence of
parties.
Independent and impartial.
must be above suspicion.
integrity and neutrality.
not influencable by others.
Hard working, physically and mentally fit.
quality of get along with people.
Tactness and ability to guide and control the
dicussion to reach ahsore with a good catche.-
reans.
common sense and practical mind.
A special alertness of mind.
Fully familiar with laws and regulations
concerning the industrial relations and
settlement of industrial disputes.
Qualification of conciliator.
page 387.
In selecting the conciliator the parties may
seek the assistnce of persons or institutions.
While appointing the conciliator the following
aspects must be checked into.
conciliator is independent and impartial.
In the case of sole or third conciliator it is
preferable to appoint a conciliator of
anationality other than the nationality of the
parties.
Conciliators appointed through institutions is
recommended as they will be experts in the
field having all the traits of qualities required
for the work.
Role of a conciliator, duties and powers.
page 388. syillabus caption.
Role important.
success depends on the ability and efficiency
of the conciliators.
The conciliator is not bound by CCP or IE act.
He decide his own procedure.
However they must follow principles of
natural justice.
Deal in an impartial and independent style.
conduct the conciliatory procedures
efficiently and appropriate to the
circumstances of the case.
At any stage of proceedings he may propose
for settlement. It need not be in writing and
with reasons.
The conciliator cannot assume the role of an
arbitrator in a case where he is playing as
conciliator.
He must not be presented as a witness either
in any judicial or arbitral proceedings by the
parties.
However if the parties agree to provide the
above role then conciliator can put on the
coat of an arbitrator or counsel.
STAGES of Conciliation.
syllabus caption.
page 392.
conciliation means settlement through
discussion without litigation.
discussion between the parties made through
the assistance of conciliator.
conciliator adopts his own rules and
procedures which are not strictly in the
nature of legal procedure.
following steps in the procedure:
one of the party sends an invitation to the
other party for conciliation as per the
provisions of Arbitration and Conciliation Act,
1996.
in the invitation he must briefly identify the
issue.
if the other party accepts the invitation in
writing the process of conciliation starts.
In case the other party rejects then there is no
conciliation.
if no reply within 30 days or as said in
invitation, then it is treated as the rejection of
the invitation to conciliate.
He must inform the other party that I taken it
as rejection.
The above provisions are meant to keep
certainty in the proceedings, and not to keep
pending the invitation for long.
Procedure of conciliation.
1. Commencement of conciliation
proceedings.
2. Submission of statements to conciliator.
3. Conduct of conciliation proceedings.
4. Administrative assistance.
Conciliator along with parties may approach
an institution for administrative assistance.
Settlement Agreement.
page 401
The end product of conciliation is the
settlement agreement.
Section 73.
if the conciliator thinks that there is some
element of settlement acceptable to the
parties, he must formulae the terms of a
possible settlement.
He must submit such settlement.
After receiving the observations he may
rework it .
if the parites reach an agreement on a
settlement of disputes, they shall draw up the
terms and sign a written settlement
agreement, and also request the conciliator to
draw up a written settlement agreement.
confidentiality.
page 402.
All matters relating to conciliation shall be
kept confidential by the conciliator.
However, he can disclose it if it is necessary
for implementation and enforcement of the
settlement agreement.
Both section 70 and 75 requires the attribute
of confidentiality from the conciliator.
Costs of conciliation :
Costs are expenses incurred in litigation or
professinal transactions, consisting of money
paid for stamps, to the officers of court, to
the counsel, and solicitors, for their fees.
costs means reasonable coasts relating to the
following:
Fee and expenses of the conciliator and
witnesses called by conciliator with parties
sanctions.
Fee paid for expert advice.
Any assistance provided under section 64-2-b
and section 68.
Any other incurred in connection with
conciliation and settlement agreement.
The conciliator fixes his fee and upon
termination gives written notice to the
parties, this cost shall be beared equally,
unless otherwise provided the settlement
agreement.
Differences:
1. Agreement.
2. Existence of dispute:
Artbitration agreement may be made even
without any present dispute and in
anticipation of that may arise in future. ( but
arbitrators are appointed only to settle
present dispute-reans)
Essentials of negotiation.
Essentials is nothing more than the tips and
toos required for an HR professional to
become effective negotiators.
Approaches.
page 441.
Negotiation has three approaches.
First approach:
Negotiation involves three basic elements.
Process, behaviour, substance.
process refers to how parties negotiate.
the context of negotiation, parties, the tactics
used, the sequence and stages all these play
out in.
Third approach.
This is bad guy / good guy tactic. When one
negotiator acts as a bad guy by using anger
and threats. The other negotiator act as a
good guy by being considerate. The good guy
blames the bad guy for all the difficulties
while trying to get concessions and
agreement from the opponet.
Disadvantages:
if viewpoints of parties is too distant solution
is far away.
there is some die-hard bargainers who
prolong decisions.
Lack of trust of negotiators by other party will
not help reach a solution.
Informational vacuums which leads to
dilemma.
cultural and gender differences may block
progress.
communication problem is another
disadvantge.
Emotions like anger pride guilt regret worry
of the negotiators affect the success of
negotiation.
Phases of negotiation:
page 451.
preparation of gathering information.
Sharing of information.
Bargaining.
Conclusion of negotiation.
Power of negotiator.
page 454.
Title power-if he is qualified then he has the
title power.
Position:
His formal position as negotiator in an
organistion confers power. Example if a
negotiator is a marketing manager, then he
can influence and win negotiations taking
place.
Knowledge or expertise.
Character.
Reward and punishment.
Behaviour style.
Reverent power.
charismatic power.
expertise power.
situation power.
Information power.
END UNIT-4
UNIT-5.
MEDIATION.
page 466.
Syllabus: Meaning - Qualities - Role -
Characteristics - Voluntary, collaborative,
controlled,confidential, informal, impartial
and neutral, self responsbile - models of
mediation - code of conduct for mediators.
Process stage:
Mediation is not having any fixed procedural
rules. It is flexible.
Procedural format is as follows:
There is a written mediation agreement
between the parties creating obligations of
confidentiality on the participants and stating
that the mediation is ' without prejudice'
At the opening of the meeting each party
biefly set out its position.
Then followes a series of meeting of
confidential nature between the mediator
and each of the teams.
Then lead to joint meeting between some or
all of each party.
This dispute is broken down to details for
easy solution.
if a settlement is made then it is reduced to
writing and signed.
The period of mediation may be a minimum
of one day and maximum one month.
Essential characteristics of mediation
process.
Collaborating, controlled, confidential,
informal, impartial, and neutral, self-
responsible.
Collaborating.
Tough problems shall be sorted out in a
creative approach to it by the
collaborators/mediators.
Controlled.
Parties control the procedure of mediation.
Not the mediators. It is non binding and it
depend upon their choice to fix a mediator.
Parties cannot be forced to accept the
decision.
confidential.
The procedure of mediation is confidential.
Informal procedure.
The procedure of mediation is an informal
one and no strict procedure is fixed by law.
The parties are free to arrive at a conclusion.
Medial process impartial and nuetral.
The parties themselves are responsible for
their decisions, as the mediator is only aiding
them to come to a conclusion and it is not
mediators decision at the outset.
Models of mediation:
page 474.
1. Faciliatative mediation
2. Evaluative mediation.
3. Transformative mediation.
4. Narrative mediation.
5. Bargaining mediation.
6. Theraphy mediation.
Facilitative.
Mediator just facilitates a decision.
Evaluative.
Legal practitioners offers this type of
mediation. They evaluate the pros and cons
of the case in a legal manner. They advice as
to the legal hurdles if opt to go legal way.
Transformative mediation.
There is no structure of mediation. It is more
of an impersonal and mediator empower the
parties to take their own decision.
Narrative mediation.
It is a different mode of mediation. An
entirely new approach is adopted. The
parties narrate their version of dispute story
and mediator can learn a lot from it including
the nature of parties.
The mediator tell an alternative story which
help the parties to understand the situation
in a better manner.
Bargaining mediation.
It is a voluntary process. Also known as
collective bargaining process.
Points of issue are clarified by the mediator,
generating options , exploring alternatives,
keeping talks moving, making suggestions,
Therapy mediation.
It is adolescent mediation. It is applied to
prevent family breakdown by working
directly with young people and their families
or caregivers to resolve conflict and improve
relationships.
He has to be neutral.
He must inform the process of mediation to
parties so that they may be prepared.
He should preserve utmost confidentiality.
He must attend mediation training
continuosly.
He should be unbiased and impartial.
He should specialise in his field.
He should help parties get legal advise if
needed.
He should take care of psychological and
physical well being of all the participants.
Disadvantages:
does not always result in settlement
agreements.
If mediation fails, subsequent personal
equations will aggravate.
No legal precedent.
No formal discovery process, every aspect of
mediation is informal.
No formal rules of procedure.
END OF UNIT-5.