ADR: The Faculties in Corporate Law to Deal With Disputes

What do you understand by the term ‘dispute’? Dispute is the event where opinions are in disparity. Dispute can happen between two people or parties or among people or parties. Hence, the conclusion is not reached and to find the conclusion the dispute should be resolved. Then the question comes, “how to resolve the dispute?” The dispute can happen anywhere in the society even in the family and at corporate level. The dispute is handled in several ways in different places.

Here we are going to discuss about dispute at Corporate level. In the British era the disputes were handled by native people and later was handled by Common law brought by English judicial to Indian Judicial system days. Post Independent, the commercial community got inclined towards arbitration for settlement of their disputes. Later, Legal Services Authority Act (1987) established the concept of resolution of dispute through Arbitration, Mediation, Conciliation and Negotiation. The Act provides for holding Lok Adalat where disputes are pending before the Courts.

Ways to settle disputes other than through litigation have adopted by many different sectors. A conflict resolution system evolved aiming to extend the spectrum of mechanisms available for conflict resolution. Collectively, these techniques have been given the acronym ADR—standing for Alternative Dispute Resolution. Alternative Dispute Resolution (ADR) refers to a variety of processes that help parties resolve disputes without a trial. The major ADR modes in India include Arbitration, Conciliation, Mediation & Negotiation.

The traits of ADR are effectiveness, less-expensive, less technicalities, flexible and maintains healthy relationship between parties. One of the unique features is it involves a neutral third party in the process.

Let’s discuss Arbitration, Mediation, Conciliation and Negotiation in brief;

Arbitration:

In this technique of resolution parties refer their dispute to one or more persons called arbitrators. Decision of arbitrator is bound on parties and their decision is called ‘Award’. The object of Arbitration is to obtain fair settlement of dispute outside of court without necessary delay and expense.

Mediation

In Mediation a third neutral party aims to assist disputants in reaching agreement, called as mediator. A mediator’s duty is to resolve dispute harmoniously by using appropriate communication and negotiation techniques. This process is totally controlled by the parties however it has to go through various stages to reach the agreement. Mediator’s work is just to facilitate the parties to reach settlement of their dispute.

Conciliation

Conciliation is a form of arbitration with less formality. It is the process of facilitating a harmonious resolution between the parties, whereby the parties to the dispute use conciliator who meets with the parties separately to settle their dispute. Conciliator meet separately to parties.

Negotiation

Negotiation is bipartite process and communication based. Negotiation tends to be a voluntary exercise i.e. by mutual consent. However, Negotiation is non-binding by nature that is it doesn’t legally bind the concerned parties.

[For deeper understanding or for assistance in any kind of Corporate related legal matters you may contact Adv. Anupam Agarwal (BE, LLB) is having more than 17 years of Legal and Corporate Experiences. After his corporate stint he started his Law firm Ramniwas Surajmal in 2018 where he provides legal advisory to Corporates and Individuals.

He has expertise of years in Corporate law, Real estate and RERA Law, Labour Laws, NCLT, DRT, Negotiation, Mediation & Arbitration.]

He can be reached at;

Mobile: 97406 45762

Email: anupam@rslegal.in