Section 4 in The Alternative Disputes Resolution Rules, 2004 and the Mediation Rules
4. Court to give guidance to parties while giving direction to opt.
- Before directing the parties to exercise option under clause (b) of Rule 2, the Court shall give such guidance to them as it deems fit, by drawing their attention to the following factors which they shall take into account, before exercising their option as to the particular mode of settlement:(i)that it will be to the advantage of the parties, so far as time and expenses are concerned, to opt for one of the modes of settlement rather than seek a trial of the dispute arising in the suit;(ii)that where there is relationship between the parties which requires to be preserved, it will be in their interest to seek reference of the matter to j conciliation or mediation, as envisaged in clauses (b) or (d) of sub-section (1) of Section 89;(iii)that where there is no relationship between the parties which requires to be preserved, it will be in their interest to seek reference of the matter to arbitration as envisaged in clause (a) of sub-section (1) of Section 89.Explanation. - Disputes arising in matrimonial, maintenance and child custody matters shall, among others, be treated as cases where a relationship between the parties is required to be preserved.(iv)that where the parties are interested in final settlement which may lead to a compromise, it will be in their interest to seek reference of the matter to judicial settlement including Lok Adalat as envisaged in clause (c) of sub-section (1) of Section 89.(v)the difference between the various modes of settlement, namely, arbitration, conciliation, mediation and judicial settlement is as explained below:'Arbitration' means the process by which an arbitrator appointed by the parties or by the Court, as the case may be, adjudicates the disputes between them and passes an award by applying the provisions of the Arbitration and Conciliation Act, 1996 (26 of 1996), in so far as they refer to arbitration.'Conciliation' means the process by which a conciliator who is appointed by the parties or by the Court, as the case may be, conciliates the disputes between them by applying the provisions of the Arbitration and Conciliation Act, 1996 (26 of 1996) in so far as they relate to conciliation, and in particular, in exercise of his powers under Sections 67 and 73 of that Act, by making proposals for a settlement of the dispute and by formulating or reformulating the terms of a possible settlement; and has a greater role than a mediator.'Mediation' means the process by which a mediator appointed by the parties or by the court, as the case may be, mediates the disputes between them by applying the provisions of the Mediation Rules contained in Part II and in particular by facilitating discussion between the parties directly or by communicating with each other through the mediator, by assisting the parties in identifying the issues, reducing misunderstandings, clarifying priorities, exploring areas of compromise, generating options in an attempt to solve the dispute and emphasizing that it is their own responsibility for making decisions which affect them.'Judicial Settlement' means a final settlement by way of compromise before a Lok Adalat or before a suitable institution or person, which shall be deemed to be a settlement before a Lok Adalat within the meaning of the Legal Services Authorities Act, 1987 (39 of 1987).
