The LexGaze Weekly - COVER STORY

Dispute Resolution during and after COVID-19

Mr Jeevan Ballav Panda

Sept 13, 2020

Issue 13

The macabre of COVID19 as a “black swan” event has engulfed within its fold every country and every sector. The pandemic has had a domino effect on businesses by severely impacting economies across the globe with shortage of labour, closure of factories, disruptions in supply chain and cash flows, loss of employment amongst others. Most of the businesses have come to a complete standstill and post the lockdown, very few sectors are showing signs of resumption that too at a sluggish pace.


The legal sector is no exception and dispute resolution across jurisdictions and forums has been significantly affected with suspended physical functioning of courts due to “work from home” and “social distancing measures” being the new norm. In practice, the Court ecosystem where we, dispute lawyers thrive, has been impacted as a whole and the traditional Court model has been seriously challenged. The only silver lining in these dark clouds is the adoption and adaptation of technology which has rather been imposed upon lawyers, leaving them with no option but to adapt or any time to get used to it. In this context, someone has rightly said that “necessity is the mother of invention”. The necessity of making justice dispensation available and accessible to the public at large compelled courts and tribunals to embrace and adopt technology at a much faster rate than it would have happened in the usual course.


Having said that, while the Supreme Court, the High Courts, and various lower Courts, particularly in metros and Tier I cities have come up to speed in hearing urgent matters (with varied threshold to determine such urgencies), the question still remains as to whether the lower judiciary at the District level in smaller cities/ towns has been able to dispense justice effectively. Justice is expected to permeate at all levels and not just confined to the Constitutional Courts.  The majority of the backlog and pendency are at the lower judiciary level and the prevalent situation has only added to the already overburdened courts of our country. With majority of the lawyers not equipped to handle e-filings, scanning, and video conferencing and majority of judges also not used to conduct hearings through virtual medium, virtual courts are definitely posing practical challenges, primarily at the lower judiciary level.


Alternative Dispute Resolution (ADR) as an effective mode of dispute resolution is a viable substitute to litigation. The acceptability of different forms of ADR like – arbitration, conciliation, mediation and negotiation and dependency on them has significantly increased over the years. Arbitration in particular has grown in leaps and bounds due to recent legislative changes in 2015 and 2019 with the objective of making it cost effective, efficient and reduce judicial intervention. The judiciary has also complimented by passing judgments which brought clarity on such recent amendments and taking a pro-arbitration approach and avoiding unnecessary judicial interference which delayed the arbitral process and derailed finality to arbitral awards. Such small yet significant steps have played a pivotal role in inspiring and convincing litigants to choose arbitration for adjudication of their disputes. It took several decades for us to accept and adopt arbitration as a part of our mainstream dispute resolution process through legislative changes and several judgments to fine tune its shortcomings and still we are far behind calling ourselves as an arbitration friendly jurisdiction. Moreover, ADR is also not an acceptable and popular mode of dispute resolution in smaller cities and towns and as such, in spite of its various advantages over litigation, it fails to achieve the objective of being an effective alternative to litigation and reduce the burden of courts.


While the other forms of ADR have made their mark in patches, there is still a long way to go for them to make a significant impact in the dispute resolution process. As Justice A.K. Sikri in the case of MR Krishna Murthi v. New India Assurance Co. Ltd. reported in AIR 2019 SC 5625 observed: “In fact, the way mediation movement is catching up in this country, there is a dire need to enact Indian Mediation Act as well.” The current need for ADR can be best summed up with the observation of Justice S.A. Bobde, the Chief Justice of India at the International Conference on Arbitration organised by the Indian Council of Arbitration (ICA) and the Federation of Indian Chambers of Commerce and Industry (FICCI) recently. It was observed by Justice Bobde that: “I think the time is ripe to devise a comprehensive legislation which contains compulsory pre-litigation mediation. The problem lies in the fact that the notion of ‘alternative’ is taken literally, as a result in numerous instances litigation is seen as the default mode, with parties turning to ADR only as a secondary option. This mindset needs to change, and unless it does, all other reforms to promote ADR methods including arbitration, are likely to remain ineffective. A conscious effort must be made by all stakeholders to reorient the way they perceive ADR mechanisms”.


Disputes in general and commercial disputes in particular, have increased manifold during these unprecedented times. With businesses suffering due to their inability to resume operations to pre-COVID19 times, revenues and liquidity has been an all-pervasive concern and contractual breaches and consequent disputes are likely to continue increasing even after we somehow manage to come through this. In the circumstances, the already overburdened courts coupled with the backlog of cases are going to test our Court system like never before once normalcy resumes in the functioning of Courts. To conclude, irrespective of whether it is litigation or ADR, well researched briefs, concise, precise and to the point pleadings/ submissions are the way to go so as to expedite adjudication of disputes. In the aforesaid premises, it is high time that we try and resort more frequently to ADR to the extent practically possible by focusing on non-adversarial forms of dispute resolution like negotiation, conciliation and mediation and try amicable resolution of disputes. On a cost-benefit analysis, in the long run, it is always practically advisable to try and resolve disputes through amicable resolution and settlement instead of pursuing adversarial form of dispute resolution, which is more cumbersome, time-consuming and expensive. This approach of amicable resolution and settlement is predominantly promoted in ADR and hence, the need for a paradigm shift.


ABOUT THE AUTHOR


MrJeevan Ballav Panda is a Partner in the Dispute Resolution and Employment, Labour and Benefits practice group in the New Delhi office of Khaitan & Co. An alumnus of the Hidayatullah National Law University, he has an experience of about twelve years and expertise in commercial litigation, arbitration, as well as labour and employment matters. Most recently, Mr. Panda was also featured in the ALB India’s Super 50 Lawyers 2020.

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