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Is Arbitration Redundant? Pt.1

It has been increasingly noticed around the world that there is a significant section of people that hold the opinion that arbitration both domestic and international even arbitration that is essentially well conducted by competent as well as independent arbitrators, isn't necessarily the most successful and efficient way of resolving disputes- especially commercial ones. Other more viable ways and methods need to be explored. To this date, skilled mediators are able to achieve results that are satisfactory to both parties, far beyond the domain and ambit of lawyers, or even of courts. But in turn, significantly more needs to be done.

Eminent Legal luminary, Mr. Fali S Nariman while at a conference organized for and by the Global Indian diaspora at Singapore while speaking on the topic: Arbitration and Business Dispute Resolution: The Ideal way forward’. Among the materials provided by the organizers, specific mention was made about an action filed in a court in Singapore at the time by the British Airways against Singapore Airlines. British Airways had alleged that a patent infringement of their first-class sleeper beds had occurred, and the action was subsequently reported in local newspapers with the comical headline being ‘Let Sleeping Beds Lie’. Mr. Nariman pointed out that the truly fascinating bit of information that was offered was that the suits were mediated for more than two days, and eventually an amicable compromise was arrived at. Both airlines issued similar press statements and releases to the effect that they would be looking forward to continuing competition though their respective products as well as services, rather than through the medium of law courts or even arbitration. He stated that this was the manner in which sensible people and responsible corporations should and do resolve business disputes. He stated that based on this very precedent, a new enabling section titled Part |||: Conciliation was subsequently added in India’s new current law on Alternative Dispute Resolution titled The Arbitration and Conciliation Act, of the year 1996.

He further stated that there has to be a conscious as well as a continuous attempt by arbitrators in both domestic as well as international arbitration, to be able to invoke Section 30 of the 1996 Act simply because it would encourage parties to get into a mediation friendly frame of mind from the beginning itself. This particular section provided for the fact that the agreement of the respective parties involved, the arbitral tribunal may “use mediation, conciliation, or even other procedures and mechanisms to encourage settlement on the whole”. The most appropriate way to “encourage settlement” is to be able to initiate it all together. As every practicing lawyer knows, court actions or even suits get compromised, more often than not, simply since the presiding officer which is the judge, after familiarizing himself or herself with what the particular case is about, eventually suggests, then nudges towards, and then later guides parties to an amicable adjustment of the entire case at hand.

Source: Harmony Amidst Disharmony- Fali S Nariman

  • Mediation
  • Mr. Fali Nariman
  • Section 30 of 1996 Act

BY : Kabir Dev

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