CS Professional · Arbitration, Mediation and Conciliation

Various Modes and Scope of Mediation including Role of Mediation in other ADR Domains: formula sheet

Full chapter guide

Key formulas

Pre-litigation mediation (s. 5(1)): Before filing suit or proceeding + voluntary + mutual consent = pre-litigation mediation, with or without a mediation agreement; Proviso: commercial disputes of Specified Value follow section 12A of the Commercial Courts Act, 2015.
Who may mediate pre-litigation (s. 5(3)): Council-registered mediator, or court-annexed centre panel, or Legal Services Authority panel, or recognised mediation service provider panel; Applies unless the parties agree otherwise.
Court-annexed mediation (s. 3(e)): Mediation, including pre-litigation, at centres established by a court or tribunal; Legal Services Authorities and court-annexed centres must keep panels of mediators for pre-litigation mediation (s. 5(5)).
Institutional mediation (s. 3(f)): Mediation under the aegis of a mediation service provider; Contrast with ad hoc, where parties run it themselves; ad hoc is not a defined term.
Online mediation (s. 30): Written consent of parties + any stage + integrity and confidentiality maintained; Tools include encrypted email, secure chat rooms, video or audio conferencing.
Section 12A, Commercial Courts Act: Mediation period 3 months, extendable by 2 months with consent of parties; settlement has effect of an arbitral award on agreed terms; Time spent in mediation is excluded for limitation. Settlement is in writing, signed by parties and mediator.
Claims Tribunal reference (s. 5(6)): Motor accident compensation claim + no settlement under s. 149 of Motor Vehicles Act = Tribunal refers parties to mediation; A non-settlement report goes back to the Tribunal for adjudication.
Extent and commencement: Section 1: extends to the whole of India; in force on dates notified by the Central Government, different dates for different provisions; Sections 1, 3, 26, 31-38, 45-47, 50-54 and 56-57 were notified from 9 October 2023.
Meaning of mediation: Process + amicable settlement attempt + help of a third person (mediator) + mediator cannot impose settlement; Section 3(h). Name used is irrelevant: pre-litigation, online, community, conciliation or similar.
Disputes not fit for mediation: Section 6(1): no mediation under the Act for any dispute or matter in the indicative list in the First Schedule; Central Government may amend the First Schedule by notification under section 6(2).
Court proviso: Court may refer compoundable offences, including compoundable matrimonial offences, to mediation; outcome is not a judgment or decree under section 27(2); The court considers the outcome further as per law.
Territorial rule: Section 13: mediation within jurisdiction of competent court or tribunal; by mutual consent, outside it or online; For enforcement, challenge and registration, it is deemed undertaken within the competent jurisdiction.
International mediation: Commercial dispute (Commercial Courts Act, 2015) + at least one foreign party (individual, body corporate/LLP, association, or foreign government); Section 3(g). The mediation agreement must refer to commercial disputes (section 4(6)).
Bar on institution: Commercial suit without urgent interim relief → cannot be instituted until pre-institution mediation is exhausted; Section 12A(1). The test is whether the suit contemplates urgent interim relief.
Time limit: 3 months from the date of the plaintiff's application + 2 months more with consent of parties; Section 12A(3) and first proviso. Extension needs consent; it is not automatic.
Limitation: Period occupied in pre-institution mediation is excluded for the Limitation Act, 1963; Second proviso to Section 12A(3).
Settlement formality: Settlement in writing + signed by the parties and the mediator; Section 12A(4).
Status of settlement: Same status and effect as an arbitral award on agreed terms under Section 30(4), Arbitration and Conciliation Act, 1996; Section 12A(5).
Who conducts: Authority under the Legal Services Authorities Act, 1987, authorised by Central Government notification; Section 12A(2).
Link to Mediation Act, 2023: Section 5 proviso: pre-litigation mediation of commercial disputes of Specified Value follows Section 12A and its rules; Section 5(1) of the Mediation Act otherwise makes pre-litigation mediation voluntary and by mutual consent.
Core role (Section 16(1)): Mediator = facilitates voluntary resolution + conveys each party's view only as agreed + helps identify issues, understanding and priorities; The parties, not the mediator, take the decisions on their claims.
Express information duty (Section 16(2)): Mediator must tell parties: only facilitates; will not impose settlement; gives no assurance of settlement; The word 'expressly' matters. Quote it in answers.
Disclosure before mediation (Section 10(1)): Written disclosure of any actual or potential conflict (personal, professional, financial or otherwise) before mediation is conducted; Test: conflict of interest or justifiable doubts about independence or impartiality.
Continuing disclosure (Section 10(2)): New conflict during mediation → written disclosure without delay; Covers conflicts newly arisen or newly come to his knowledge.
Waiver and replacement (Section 10(3) and (4)): Waiver: all parties in writing. Replacement: institutional → apply to mediation service provider; otherwise → party terminates mandate; Waiver needs all parties. Replacement can be sought by either party.
Limits in other proceedings (Section 17): Mediator shall not act as arbitrator, representative or counsel in proceedings on the same dispute, nor be presented as a witness; Protects neutrality after mediation ends.
Section 17(a): bar on other roles: Mediator ≠ arbitrator, representative or counsel of a party, in any arbitral or judicial proceeding on the dispute mediated; Applies to the dispute that is the subject matter of the mediation proceedings.
Section 17(b): bar on witness role: Mediator ≠ witness presented by the parties in any arbitral or judicial proceeding; The text bars the parties from presenting the mediator as a witness.
Section 12A Commercial Courts Act: Suit without urgent interim relief → exhaust pre-institution mediation first; 3 months + 2 months extension with consent; Time spent in mediation is excluded for limitation. Settlement is signed by the parties and the mediator.
Status of Section 12A settlement: Settlement = arbitral award on agreed terms under Section 30(4), Arbitration and Conciliation Act, 1996; Section 12A(5).
Section 16(2) disclosure: Mediator informs parties: only facilitates, imposes no settlement, gives no assurance; Useful to contrast with an arbitrator's decision-making power.
Cost of mediation (Section 25(1)): Cost of mediation, other than community mediation = such as may be specified; The Act itself does not fix amounts. Community mediation is outside this sub-section.
Default sharing rule (Section 25(2)): Each party's share = Total costs ÷ Number of parties, unless otherwise agreed; Total costs include the mediator's fees and the mediation service provider's charges. Worked examples assume the shares fall equally on the parties.
Agreement exception: Parties' agreement on sharing > default equal sharing; The equal rule applies only when the parties have not agreed otherwise.

Quick revision

Mediation: a process where parties try to settle with a third person (mediator) who cannot impose a settlement.
Court-annexed mediation: mediation, including pre-litigation, at centres established by a court or tribunal.
Institutional mediation: mediation under the aegis of a mediation service provider.
Section 5 of the Mediation Act: parties may voluntarily try pre-litigation mediation before filing a civil or commercial suit.
Section 12A, Commercial Courts Act: a suit with no urgent interim relief cannot be instituted until pre-institution mediation is exhausted.
Section 12A time limit: three months from the plaintiff's application, extendable by two months with the parties' consent.
Time spent in pre-institution mediation is not counted for limitation under the Limitation Act, 1963.
A Section 12A settlement is written, signed by the parties and the mediator, and has the status of an arbitral award on agreed terms.
Section 16: the mediator facilitates, does not impose a settlement and must tell the parties so expressly.
Section 17: the mediator cannot act as arbitrator or as representative or counsel, and cannot be presented as a witness, in proceedings on the same dispute.
Section 25: unless the parties agree otherwise, all costs, including the mediator's fees and provider charges, are borne equally.

Common mistakes

Treating ad hoc mediation as a statutory term with its own definition. Fix: Section 3 defines court-annexed and institutional mediation but not ad hoc. Describe ad hoc as mediation arranged by the parties without an institution.
Saying pre-litigation mediation needs a mediation agreement. Fix: Section 5(1) applies whether or not a mediation agreement exists. It needs voluntary, mutual consent.
Treating the First Schedule as a closed, exhaustive list. Fix: Write that the list is indicative and the Central Government can amend it by notification under section 6(2).
Saying a court-referred compoundable offence settlement becomes a decree of the court. Fix: State that under the second proviso to section 6(1) it is not deemed a judgment or decree under section 27(2) and the court considers it further under law.
Saying pre-institution mediation is voluntary for all commercial suits. Fix: Remember that Section 12A bars the suit unless mediation is exhausted, except where urgent interim relief is contemplated. The Mediation Act proviso sends commercial disputes of Specified Value to Section 12A.
Treating the three-month period as extendable by the court or the mediator on their own. Fix: The two-month extension needs the consent of the parties.
Saying the mediator decides or gives an award. Fix: Write that the mediator only facilitates and cannot impose a settlement under Section 16(2).
Saying the mediator may pass on all information between parties. Fix: Say views are communicated only to the extent agreed by the parties.
Saying the mediator can act as arbitrator if both parties consent Fix: Section 17(a) has no consent exception in the text. State the bar as written.
Applying the bar to any dispute at all Fix: Clause (a) is tied to the dispute that is the subject matter of the mediation. Mention this link.

Exam tips

Write the mode first, then the section. Examiners reward a clear provision, analysis, conclusion structure.
In comparison questions, use the criteria of who conducts, where, and under which section. State that ad hoc is not defined in the Act.
Always mention the section 12A link when facts show a commercial dispute.
Quote key conditions exactly: voluntary and mutual consent for section 5, written consent for section 30.
Draft the answer around the facts. Name the parties and the stage of the dispute.
Quote the section number with each point: 3(h), 3(g), 6, 13. It shows precision.
In case-based questions, first classify the dispute, then apply the rule, then conclude.
Say "indicative list" whenever you mention the First Schedule.