Justice Bobde said a robust "arbitration bar" is critical to the development of institutional arbitration in India as it would ensure availability and accessibility of practitioners with knowledge and experience. (PTI photo)
Underlining the effectiveness of mediation to address commercial disputes, Chief Justice of India S A Bobde on Saturday said it is time to have a comprehensive law on making pre-litigation mediation mandatory.
“I think the time is ripe to devise a comprehensive legislation which contains compulsory pre-litigation mediation and a remedy for the biggest drawback in a mediation agreement, that is to say the unenforceability of an agreement arrived at a mediation, would ensure efficiency and also reduce the time pendency for parties as well as the courts,” the CJI said.
Speaking at the Third International Conference organised by the Indian Council of Arbitration (ICA) and Federation of Indian Chambers of Commerce and Industry (FICCI), the CJI said: “Maybe if some method could be found for certifying that an agreement has been freely entered into and for making it executable like a degree, mediation could become the most effective ADR (Alternative Dispute Resolution mechanism).”
He said though arbitration is the most preferred mode of privately resolving a varied range of disputes today, “however it must be kept in mind that the same is at the cost of mediation and conciliation which is much faster and less expensive”.
Tracing the history of ADR in India, he pointed out that it is not a recent phenomenon. “Arbitration and mediation are a deeply embedded dispute resolution mechanisms in India’s commercial practices and social life... Sage Yajnavalkya is said to have, in ancient Indian texts, referred issues to various arrangements including srenis (occupational guilds), kula (family or clan assemblies), and puga (tribunals that comprised of people dwelling in the same place), all of which closely approximate the present system of arbitration.”
Despite its long history, the arbitration regime in post-Independence India was considered to be archaic, unpredictable and expensive and it was in this background that the Arbitration and Conciliation Act 1996 was enacted.
The last few years, CJI Bobde said, “have witnessed an accelerated maturing of the Indian arbitration regime and community spurred on by an ever-increasing demand for arbitration services in India”.
The success in endeavours aimed at transforming India into an international arbitration hub, he said, would depend on the diligence shown by various stakeholders in spotting and addressing relevant concerns and issues.
Institutional arbitration, he said, has met with limited success in India as Indian parties still show a strong preference for ad hoc over institutional arbitration. He stressed the importance of the role of members of the legal fraternity in solving this and said “a robust arbitration bar is critical” for this.
The CJI also touched upon the importance of “disruptive technologies” in arbitration and said “as one scholar puts it both ‘IA’ (International Arbitration) and ‘AI’ (Artificial Intelligence) are leading alternatives to status quo: IA to traditional methods of dispute resolution, AI to traditional methods of performance”.
“Artificial Intelligence could provide immense benefits for the arbitration process and its users. By augmenting human cognitive abilities, AI powered services could assist lawyers in drafting, identification of better authorities, reviewing of documents, etc... AI-assisted arbitration holds immense promise for the arbitration community,” he said.