Answer 1.

Issue: Whether the amendments introduced by the Arbitration and Conciliation

(Amendment) Act, 2016 to Section 8, 11 and 34 of the Act to reduce judicial intervention and its
effect in over-ruling the earlier decisions of Supreme Court in this regard?

Amendments to the Act:

Scope of Judicial Intervention under Section 5 of the Arbitration and Conciliation Act, 1996. It says
that no judicial authority shall intervene in the matters governed by this except where so provided in
this part.
The Section 8 of this said act, states that Supreme Court or any court has power to refer to
arbitration unless it prima facies sees that there is no valid agreement exist. Section 11 says that if
both the parties have failed to appoint an arbitrator in a case then the high court of supreme court
must appoint the arbitrator in the case on the request upon a party. Set aside the arbitral on the
application made by the applicant on certain grounds under the Section 34 of the said act.

Critical Analysis:
The Arbitration Act was enacted in the year 1996, with the intention of providing speedy and
effective resolution of disputes through arbitration or conciliation and reduce the burden on courts.
However the arbitration has been a subject of judicial intervention for years, leaving the parties to
think whether to incorporate the arbitration clause or not? After the much chaos finally the
Arbitration and Conciliation (Amendment) Act, 2016 has been introduced by the parliament to limit
the judicial intervention in the Arbitration.
The amended Section 8 empowers the judicial authority to refer the parties to arbitration
when there is an arbitration agreement, unless it finds prima facie that no valid arbitration
agreement exists. While Section 8(1) refers to “judicial authority”, inexplicably, in Section 8(2) the
word ‘Court’ has been used instead of ‘judicial authority’ which appears to be contested as the term
‘court’ will be applicable to the courts only, any other judicial bodies intervention will not be
covered under this section. Also, there are different standards in the section 8 and 11 in one it says
that court will only examine the existence of agreement and in other it says that it will also check
the validity of the agreement.
The scope of “public policy” in Section 34 has been narrow down and the arbitral award can
be set aside only if the arbitral award was induced or affected by fraud or contravention with the
fundamental policy of India or conflicts with the most basic notions of morality or justice. In order
to counter the judgment of the Supreme Court in ONGC Limited v. Western Geco International
Limited,. In terms of this amended provision, an award cannot be set aside merely on the ground of
erroneous application of the law or by re-appreciation of evidence.
Assessment: The Amendments introduced in the Arbitration and Conciliation Act, 1956 were an
important step towards strengthening the Alternate Dispute Resolution and for sure it has cultivated
the arbitration culture in India. However, this amendment poses double standards in certain aspects
also they are not exhaustive yet. Thus amendments are needed to resolve the flaws in the
Amendment Act to make it more effective. The arbitration law will be more promising after that to
resolve the dispute in India.

Answer 3. No, if the mediator chooses to testify, his evidence is not admissible.
One of the lucrative aspects of the mediation is that it is confidential. Most of people opt for
mediation before going to court of law is because they believe that even if the mediation will not be
successful, the information shared by them on the table will remain confidential. In order to make a
dispute reach settlement through mediation parties need to put their information on the table. One
goes for the mediation knowing the fact that the confidentiality is the cornerstone of the information
shared between them. Even in the cases court refer the case to the mediation when it comes to
parties about sharing the information they will not reveal until and unless they are assured that it
will not be disclosed.

Arguments for plaintiff:

The Court appointed a mediator in attempt to resolve the harassment dispute. In which the plaintiff
has shared all the information with the mediator, so that the harassment dispute could reach to a
settlement with a belief that his information will be kept confidential. In my opinion, it also shows
that the plaintiff wanted to reach settlement through amicable means and for that reason only he has
shared all the information and court should not accept an evidence provided a person who is
supposed to keep it confidential against a bonafide person. Else, people will lost faith in the
alternate dispute resolution system.
It is reckoned by the plaintiff in this instant case that if the harassment dispute will reach to a
settlement, the mediator would send the settlement agreement signed by the parties to the court
without stating what was revealed during the proceedings. If unsuccessful, he will simply tell the
court that the settlement did not reach.
In India, the term mediation has been often used interchangeably with the term conciliation.
Section 75 of the arbitration and conciliation act, 1996 “provides that the Conciliator and the parties
shall keep confidential all matters relating to the conciliation proceedings including the settlement
agreement, except where its disclosure is necessary for purposes of implementation and
enforcement.” It was enacted in line with the UNCITRAL Model Law.
Case laws: In the landmark judgment of Moti Ram (D) Thr. L.Rs. and Anr. vs. Ashok Kumar [2010]
14 (ADDL.) SCR 809 and Anr. The most significant character of mediation was upheld by the
courts and quasi judicial bodies. The Supreme Court of India in this case had sent the case for
mediation to a Mediation Centre to try to resolve the dispute between the parties. Later, a report by
the Mediator was placed before the Court that included the various settlement proposals made by
the parties, among other things. As a consequence, the Supreme Court emphasised that mediation
proceedings are strictly confidential.
In the case of Rama Aggarwal vs. PIO, Information about mediation proceedings was demanded by
the Delhi State Legal Service Authority that was brought before the Central Information
Commission (CIC), It was replied by the CIC that a party cannot seek information pertaining to
mediation proceedings under the Right to Information Act, 2005 as the same comes under
exceptions under provisions of the RTI Act. The CIC remarked that “Information regarding
negotiation, mediation, conciliation and counselling will fall under exempted clause of information
of other spouse, being personal and given in fiduciary capacity and, no public interest is established
in disclosure, while there is larger public interest in protecting that information as that would help
mediation to flourish, hence such information shall not be disclosed.”
Various High Courts have their own rules in regard of the confidentiality of the mediation in
their jurisdiction. Rule 21 of The Companies (Mediation and Conciliation) Rules, 2016 states that
the parties to the mediation must maintain confidentiality regarding the information shared by the
other party, they must not rely on the information provided during the proceedings except to reach
settlement during that mediation only. No witness, audio or video recording must be done by
anyone involved in that mediation.

Finally, it can be concluded that Indian laws and courts shows that mediation proceedings must be
confidential and no information should be divulged. Most importantly in this instant case it can be
connoted that the mediator can’t testify for the defendant in the court of law. Sustaining mediator’s
testimony will hamper the growth of mediation in India.

Answer 5. A pre condition in an arbitral clause is to provide a multi-tiered mechanism to reach the
speedy resolution of the dispute amicably. The prescription of such a condition is to reach the
dispute settlement through the smoothest and fastest way possible. The arbitration and Conciliation
Act, 1996 also reflects this understanding. It especially provides a mechanism in which the dispute
is guided towards the settlement through the best way possible with less interference of courts and
with a priority to fastest and most suitable mechanisms. A pre-condition provides a framework of
each steps to go through before going to the arbitration. The insertion of such a pre-condition is
formulated on the necessity to look for amicable and fastest modes of dispute resolution for that
particular case. Because in general things may vary case to case and the parties should arrange a
meeting to look for the requisite mode of resolution.

Arbitration Clause
“Parties shall make a diligent and good faith efforts to resolve their disputes in accordance with the
provisions of the section by negotiation within 30 days before either party can commences
arbitration. The arbitration will be conducted in Delhi before a sole arbitrator to be appointed jointly
by parties and the award will be final and binding.”

Issue: Whether this pre-condition is clear and enforceable depends on the language of the clause as
well as the intentions of the parties which will determined by the conduct of the parties?

Language of the clause:

The wording of the says that it is mandatory to follow such a condition then it must be followed,
however the parties does not need to follow such steps if the clause does not say so.

Parties intentions to insert this pre-condition:

In Visa International Ltd. v. Continental Resources (USA) Ltd, It was adjudged that arbitration
agreement between the parties and the Petitioner was subject to a reference under Section 11 of the
Arbitration Act. It was also held he intention of the parties is to be gathered from the surrounding
circumstances including the conduct of the parties and the evidence such as exchange of
correspondence between them.
Therefore, in this particular class of cases, the pre-arbitration mechanism, although
enforceable, has not been strictly complied with and the standard of compliance has been held to be
valid by courts. One thing is for certain, that even in such cases, where the multi-tiered dispute
resolution clauses are not lucid and uncertain the Indian courts have not held them to be
unenforceable.

Un-enforceability of such a pre-condition in the clause:

In the case of Sun Security Services v. Babasaheb Bhimrao Ambedkar University Supreme Court
had interpreted whether a clause was an arbitration clause or not and whether such a clause could be
held to be enforceable before approaching court. The Allahabad High Court has applied the
reasoning and logic in the Supreme Court’s decision upon its own facts. The effect of this holding
implies that a pre-arbitration mechanism has been treated at par with a pre-litigation mechanism.
Such observation by the Allahabad High Court blurs the stand of enforceability of a multi-tier
dispute resolution clause in Indian law as the Court has held the mechanism to be unenforceable. It
was held unenforceable because of the vague criteria’s.

Conclusion: Overall after looking into various judgments of Supreme Court and High Court it can
be connoted that a pre-condition in an arbitral clause is not per se unenforceable, however the
criteria laid down in a pre-condition can be vague and unenforceable which can only be adjudicated
after examining the contextual meanings of the words of the pre-condition in an arbitral clause.