POTENTIAL FOR ADR AND ARBITRATION IN SMALL CITIES AND TOWNS IN TIMES OF PANDEMIC
Intern, Legal Angles Patna
Dispute resolution is a term given to the process which decides a conflict arisen between parties. It could be either through “Traditional Dis pute Resolutions” which refers to the proceedings before the appropriate court of law and “Alternative Dispute Resolution (ADR)” which includes resolution outside the court. It has been hailed as a welcome means taking into consideration the burdened judiciary system and lengthy litigation processes. Most widely used ADR options are Arbitration, Mediation and Conciliation. This is usually considered to be a practice of metropolitan cities but it has got umpteen potential in smaller counterparts as well especially owing to the present outbreak of COVID pandemic.
A brief history of ADR in small cities and towns:
As per the hindu law, there is a mention of “Brhadaranayaka Upanishad” which talks about the arbitral bodies known as ‘Puga’ , ‘Srenis’ and ‘Kulas’ were appointed in small provinces to settle the dispute between the local members. It is considered to be one of the most sought after resolution back then in many jurisprudence.
Furthermore, the presence of methods like settlement by Panchas in the pre independence era is an evidence on how process of ADR are deeply enrooted in our culture but with different names. Privy Council duly recognised and gave credence to the decision given by Panchas outside the court in the case of Vytla Sitanna Vs. Marivada Viranna (1934).
Potential of ADR in small cities and town :
According to a survey, 82% of the parties involved with ADR suggested that they would continue to use such a method is future conflicts which includes parties from small cities as well. Thus, it can be said that the small cities are not clearly aloof of ADR which is an optimistic statistics.
Due to prevailed situation of global pandemic, people across the globe are adapting to the concept of ‘New Normal’ and thus even the second and third cities are potent of budding ADR.
Few of the reasons are as follows:
1. Confidentiality- Small cities have lower population which can lead to the spread of word even faster and with new opportunities coming up post the current situation, blooming businesses would refrain themselves from indulging into litigation. Also, various international and national brands are expanding their reach to small cities and will prefer privacy of the disputes.
2. Lack of Expertise- It has been seen over a period of time that parties from small cities are compelled to move to the courts of metropolitan cities when a subject of specific nature got involved. Due to lockdown being imposed in various parts of the country, it is not feasible enough and thus Arbitration can be significant as it allows the parties to choose the arbitrator as per their requirement.
3. Convenience- As precautionary measures against the virus, courts have been closed for good number of days and even when started there were primarily virtual hearings. The use of technology and new such processes are even more difficult in small cities as they are not accustomed with technology like metropolitan population. Hence, it opens a gate for Arbitration where the parties have autonomy to decide on the mode of the proceedings.
4. Cost effective- There is a huge gap between the income per capita of small and big cities and then being hit by an extensive lockdown have even shook the people having deeper pockets, small city population would prefer to choose an option like ADR which is cost effective as compared to traditional methods of dispute resolution.
5. Lack of knowledge- Mediation is one such process which has got an excellent scope in smaller cities as the population of such places do not have the information and awareness about the technicalities.
Due to COVID, a good section of migrants from various fields have returned back to their respective cities and their knowledge can be utilized for this.
6. Widening horizons of trade- Small cities and towns are at the phase where new kind of businesses are rushing in for establishment eg. After 2018,there is an inflow of E- Commerce sites and Online delivery system in small cities which were earlier only big cities. As these new concepts of business are being exhibited, there is a scope of ADR for future disputes as their metropolitan counterparts are indulged in so.
7. Speedy Trial- Post lockdown, the businesses have been hit badly and especially in the cities like second or third tier, parties are no longer in a state to afford lengthy proceedings of the court as it would incur further losses to the business. Thus, an alternative of ADR can be considered as an option for speedy trials and interim measures.
To further ensure the amplification of the penetration of ADR in small cities and towns, there is a need of holistic approach including 3 A’s - Availability, Accessibility and Affordability.
In order to achieve the desired results, followings steps can be taken - Establishment of Arbitral Institution in every state.
- Accreditation of arbitrators.
- Amendments to the ACA to meet the dynamic changes as par with the other parts.
- Enchancing the role of government in promoting ADR through legislative and non-legislative means.
- Establishment of Mediation Centres for better accessibility and awareness.
As per a research conducted by International Bar Association in 2013, it was observed out of all the continents, Asia Pacific region has indicated a warm response to arbitral proceedings and India was considered to be a blooming ground after Hong Kong and Sinapore. It also talks about that there is a high probability of penetration of such ADR methods into the very parts of the country including both small and metropolitan cities. The current outbreak of the Corona Virus have caused enough havoc around the globe but following the law of change being a constant and adapting to this new normal is a necessity which has to be embraced by both the kinds of cities and thus, the pandemic brings forth the potential of ADR particularly Arbitration in small cities and towns in the above mentioned context.
It is a process in which the dispute between the parties are decided by a neutral third party known as an arbitrator. In this process a neutral and credible third party facilitates a settlement of the involved transacting parties. Here the parties in dispute brings it to a neutral third party who improves the communication and brings forth the best possible solutions. Conducted by Pricewaterhouse Coopers Private Limited in the year 2013 According to a survey done by an American company, it was observed that companies are more inclined towards extension in small cities owning to the fact that metropolitan cities are already being flooded with options. The Current State and Future of Arbitration: A Regional Perspective (IBA Arb 40 Subcommittee)