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CS Professional · Arbitration, Mediation and Conciliation · Various Modes and Scope of Mediation including Role of Mediation in other ADR Domains

Ritu Exports and Mehta Logistics agree in writing that Ritu Exports will bear 70% of all mediation costs and Mehta Logistics 30%. The mediation then proceeds. What is the position under Section 25 of the Mediation Act, 2023?

The agreed 70:30 split prevails. Section 25(2) provides equal sharing only where the parties have not agreed otherwise, so parties may allocate mediation costs differently by agreement. No court or mediator approval of the split is required.

  1. AThe agreement is void because costs must always be shared equally
  2. BThe agreed 70:30 split prevails over the equal-sharing defaultCorrect
  3. CThe mediator must decide the split after the mediation ends
  4. DEqual sharing applies because the agreement was not made before a court

Explanation

Section 25(2) makes equal sharing subject to the words 'unless otherwise agreed by the parties'. A written 70:30 agreement therefore displaces the default. Nothing in the section requires court involvement or a mediator decision on costs.

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