Neutrality As a Mediation Ethic: An Analysis

This article was authored by Nipuna Varman from NALSAR, Hyderabad.

Abstract

The following essay shall analyse the Commercial Courts (Pre-institution Mediation and Settlement) Rules, 2018 focusing on the provision or the lack thereof of neutrality as a mediation ethic in India. The importance of mediation ethics needs to be realised and rules should be implemented keeping in mind the interests of the disputants and the ultimate aim of mediation as a dispute resolution, i.e., speedy trial and satisfaction of the stakeholders. The essay shall elucidate on the theory behind neutrality as a mediation ethic and will suggest measures to ensure a more efficient process of mediation that is not only effective but also ethical.

1. Introduction

Mediation is a form of alternative dispute resolution where an agreement is made by the parties involved as per their convenience and wishes. In a mediation the disputing parties appoint one or more mediator(s) to function as the bridge between the parties and to assist in reaching an effective resolution. The mediator ensures that the needs and requirements of the parties are considered and an agreement that satisfies all the parties is made. To facilitate such an agreement the mediator has to follow certain guidelines which are known as mediation ethics.

Mediation ethics serve the purpose of regulating the acts of a mediator. A mediator is a human being and is bound to commit errors that may affect the interests of the parties. One of the standard rules of mediation is that it is an interest-based dispute resolution and not rights-based and this is the reason why mediation is vouched to be more effective and efficient than the traditional litigation system. It allows the disputants to dictate the terms of settlement and ensures a quicker resolution. Therefore, the actions of a mediator have to be regulated to ensure that the interests of the parties are met.

The Government of India promulgated an Ordinance amending the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 (‘Act’) and under Section 12A of the Act mandatory pre-institution mediation has been introduced.^[1] In reference to this the Commercial Courts (Pre-institution Mediation and Settlement) Rules, 2018 (‘Rules’) was introduced on 3^rd July 2018. These Rules under Section 12 provide for certain ethics to be followed by the mediator, these ethics include confidentiality, fairness, complete disclosure, clarity, etc.^[2] However, the Rules do not explicitly mention the neutrality, impartiality, or independence of the mediator. The aim of this paper is to identify the reason behind such exclusion and provide a solution to the dilemma of neutrality of a mediator.

This paper shall address the aforementioned issue in a three-pronged manner. Firstly, it shall focus on the theoretical underpinnings of neutrality, i.e., the perception of neutrality as impartiality and neutrality as equidistance. This part shall deconstruct neutrality and shall aim to determine the reason behind the lack of explicit mention of neutrality in the Rules. Secondly, it shall compare the Rules to other mediation guidelines such as, Mediation Rules 2017 by the Indian Institute of Arbitration and Mediation, (Draft) Alternative Dispute Resolution and Mediation Rules, 2003, the Companies (Mediation and Conciliation) Rules, 2016, and Draft General Scheme of Mediation Bill 2012 and shall attempt to compare the stance on neutrality taken by these documents. Thirdly, the paper shall attempt to offer solutions to tackle issues of neutrality as a part of mediation ethics and shall, through these suggestions, attempt to maintain the interest-based approach of mediation.

1. Analysis

In the following section the nature of neutrality and the possible reason behind the exclusion of the word (in the Rules) will be explained in a step-by-step manner. Deconstructing the concept of neutrality shall help provide a solution to engage with the problems involving neutrality of mediators.

1. The Conundrum of Neutrality

In a survey conducted by Sara Cobb and Janet Rifkin where interviews with fifteen mediators in six community mediation programs were conducted the mediators were asked about the challenges they face with respect to neutrality.^[3] It was observed that the consensus regarding neutrality has been that it is interdependent on three terms – justice, power, and ideology.^[4] The mediators stated that many a times the need to be fair and just is the guide to their neutrality, they ensure that the interests and opinions of all the parties are heard, and in situations where there is a power imbalance amongst the parties the mediator has to use their neutrality to equalize the power. Further, in some situations the mediators face challenges because of their own preconceived notions and beliefs and in such situation neutrality as an ethic becomes important.^[5]

In the aforementioned survey the researchers identified neutrality in two forms – neutrality as impartiality and neutrality as equidistance.^[6] Neutrality as impartiality refers to a discourse which is devoid of all ideological processes, this is referred to by Habermas as the ideal speech situation.^[7] According to Moore impartiality reflects in a mediation when the final outcome is not influenced by the opinions and beliefs of the mediator.^[8] However, often one party overpowers the other and the mediator is required to balance the power dynamic between the parties. This is neutrality as equidistance, the mediator is supposed to use their judgment to ensure that all the interests of a party are represented. The contradiction that arises here is that while neutrality as impartiality requires the mediators’ judgment to be free of bias, neutrality as equidistance requires the mediators to balance the power between the parties based on their judgment and understanding. However, this shouldn’t be looked at as two mutually exclusive concepts but the mediator is supposed to establish a balance between these two practices.

Further, the aspect of justice that the mediators refer to is only procedural in nature. The mediators cannot control or dictate the terms of the settlement made between parties and therefore substantive justice is not ensured. Critical legal scholars and feminists have argued that simple procedural justice does not solve the problem of oppression and that it neutralises the conflict which could lead to social change.^[9]

The aim of elucidating on the theoretical underpinnings of neutrality is to highlight that mediation is a political process where the narrative of one party often dominates the other. The contradiction to mediation ethics arises because the mediators often do not attend to narrative process adequately, in the aforementioned research it was observed that in twenty four out of thirty mediation sessions the initial narrative sets the tone for the entire session and settlement emerge out of such narrative.^[10] This implies that one side gets marginalised over the narrative of the other side.^[11] It has been observed that discourse is not engaged with and through the vocabulary used by the mediators the dominant story manifests itself in the settlement agreement. Therefore, neutrality, as has been understood in the common parlance becomes a conundrum in actual mediation session where one side dominates the other. The solution of this problem requires the mediators to use language in a manner which does not delegitimize the narrator. This, however, only solves the issue of not looking at mediation as a discourse to ensure neutrality but another issue that arises is that often the mediators face confusion with regards to what would constitute a violation of neutrality. Neutrality as impartiality and neutrality as equidistance are not only paradoxical to the above discussion but also do not provide an effective measure of the neutrality required in a mediation session.

Many a times mediators face situations where it becomes difficult to determine whether an action is a breach of neutrality or as something that does not concern the situation at hand. For example, in a situation where the attorney of one of the parties involved in the dispute went to college with the mediator, the responsibility of disclosing this information is on the mediator. However, the mediator had not been in touch with the attorney for a few years and this made it difficult to assess the importance of the aforementioned information. The mediator has to decide whether it is unethical to not disclose the existing relationship.^[12] As has been discussed earlier despite the consensus on neutrality as an important mediation ethic there is no guideline for mediators to asses a situation. Various methods have standards are used by mediators worldwide for assessment purposes. Some examples of the same are, Mentor Approach according to this method one puts an admired personality in their own place and ask what their course of action would be in such a scenario,^[13] Gut Test, this test relies solely on the intuitive abilities of the mediator.^[14] Further, the Newspaper Test requires the mediator to imagine their actions to be on the front page of the newspaper this makes the mediator to take into account not just the personal ethics but also the perception of them by others.^[15] These rules still do not provide for a robust system of assessing a situation as these rules are extremely subjective and do not hold much ground. The Rules lack the aforementioned system much like most of the other mediation regulations. Therefore, to further provide a solution for this issue one would be required to conduct a comparative analysis of the Rules to other mediation regulations functioning in India and this shall be elucidated upon in the next section of this paper.

1. Comparative Analysis

To understand the shortcomings in the aforementioned Rules one needs to compare it to other mediation rules that have been followed in India. This paper shall be comparing the Rules to – the (Draft) Alternative Dispute Resolution and Mediation Rules, 2003, the Companies (Mediation and Conciliation) Rules, 2016, Draft General Scheme of Mediation Bill 2012, and the IIAM Mediation Rules 2017.

The draft rules of 2003^[16] and 2012^[17] along with the rules of 2016^[18] require the mediator to be an impartial party to the mediation session. It requires the mediators to disclose any conflict of interest that they might have before taking up a case, further, if at any point the parties believe that the mediator is not neutral and impartial then objections can be made. Impartiality, neutrality, independence, confidentiality, etc. have been made the core values that a mediator should adhere to. The Pre-Institution Mediation and Settlement Rules makes no mention of neutrality, impartiality, or independence. It does, however, state that the mediator has to disclose any financial interest they might have in the subject-matter of the dispute.^[19] Lack of neutrality in a mediation goes to the core values of the mediation ethics and affects the self-determinative nature of the mediation. This is because when the mediator is biased and has a conflict of interest then they have the power to influence the session and alter the terms of the agreement reached. The possible reason behind this exclusion will be discussed subsequently but it has to be noted that the Rules not only exclude the aforementioned words but also does not provide for an adequate system of recourse in case the mediator does not adhere to the ethics laid down. The lack of a general mechanism for pre-institution mediation has been cited as a grievance by the petitioner while challenging the constitutional validity of section 12A of the Act.^[20]

Indian Institute of Arbitration & Mediation within in its 2017 rules not only uses the terms impartiality, independence, and neutrality but also does not use them as synonymous terms. This acknowledgment of each of these terms being distinct, to some extent, addresses the paradox of neutrality as mentioned in the previous section. This is done by ensuring that neutrality, impartiality, and independence are distinct ethics that are to be balanced by the mediator during the session. Further, these rules provide for a two-step redressal system for the parties aggrieved by the breach of mediation ethics.^[21] It formulates a two-step process which involves the discussion step where the mediator can be made aware of the grievance of the party within a month of such breach and a discussion shall follow.^[22] The next step in case the discussion fails is called the Professional Conduct Assessment Process where the IIAM shall appoint an assessor to address the complaint and reach a resolution.^[23]

It becomes important to set up a robust system, as has been mentioned above, to ensure that the ethics of mediation are given its due importance and the parties who decide to use mediation for dispute resolution are provided with effective solutions to their dispute. The point where the Rules falter is where it does not acknowledge and address the depth and importance of mediation ethics especially neutrality. As has been mentioned in the previous section despite the universal consensus on importance of neutrality it has been observed that mediators often allow one narrative to dominate over the other. Therefore, emphasising on the importance of neutrality, independence, and independence is not sufficient. The rule-makers, instead, need to provide clear instructions for the mediators to assess a situation at hand and a system for redressal, when a breach occurs, has to be set up. The Rules fail to achieve both these goals, the rules are loosely constructed and the parties are not provided with any recourse in case there is a breach by the mediators.

However, one needs to look at alternatives that can be adopted to solve the aforementioned issues. It becomes important to seek alternatives as the current system not only confuses the mediator but also leaves the recipients of mediation services without any recourse. One of the methods in which the issue can be addressed is by adopting a system similar to the IIAM rules, i.e., the clarity in terms of neutrality, independence, and impartiality being important ethics to be followed by the mediator and the two-step redressal system to preserve the interests of the disputing parties. Further, in the next section the paper shall discuss various measures that can be adopted to maintain neutrality in a mediation session.

1. Step Forward

To understand how to deal with various situations in international arbitration where conflict of interest may arise the arbitrators are a provided with a tool known as the IBA Guidelines on Conflicts of Interest in International Arbitration.^[24] This provides a list of basic instructions to be followed by arbitrators in a situation of conflict of interest. Further, this document also provides for specific instances that may arise during an arbitration session. This list is colour coded in a manner which makes it clear and easy to understand. Conflicts of grave nature are listed in Red, under this the arbitrator has to immediately resign as they become incompetent to arbitrate on the matter. Under Orange, the parties are to be notified of the possible conflict but if the parties express their willingness to allow the arbitrator to continue their duty then they are free to do so.^[25] Finally, under Green, the parties do not need to be notified as the gravity of the conflict is negligible.^[26] However, in case there are other aggravating factors the disclosure to the parties may become important.^[27]

This framework is user-friendly and provides the arbitrators and the disputing parties a clear picture of the transparency requirements. The biggest challenge that neutrality as a mediation ethic faces is the lack of a framework to guide the stakeholders through the process. It is conceded that it is not feasible to list out every possible situation and provide guidelines regarding the same, but a list of instances that commonly occurs during a mediation session can be determined. Therefore, in the example of the attorney of the disputing party being known to the mediator, the mediator would not have been subject to confusion regarding the disclosure of the said fact had there been similar guidelines for mediation in place.

Further, the Rules need to not only explicitly mention neutrality but also distinguish between neutrality, independence, and impartiality. As has been elaborated previously various mediation regulations have mentioned impartiality and the IIMA rules have mentioned the three terms separately. This becomes important because using the terms as synonyms leads to confusion, impartiality is the mediator’s lack of preference, i.e., not being involved in the outcome of the process and independence is the lack of objective links to the parties, the mediator cannot influence the parties involved in the process.^[28] Therefore, there cannot be a partial neutral but there can be dependent neutral.^[29]

To ensure that the mediation sessions are neutral and that all parties get to put forth their needs and requirements the mediators should ensure that one narrative does not dominate the other, there should be a proper framework in place that guides the mediators through tricky situations, and that neutrality as a mediation ethic is emphasised more and is elucidated upon by lawmakers. The Rules currently in place are inadequate and could lead to dissatisfaction amongst the parties involved.

1. Conclusion

Mediation has been looked at as an alternative to traditional dispute resolution mechanisms. It ensures that the parties involved can reach a settlement on their own terms and their needs are, to an extent possible, realised. It is an efficient method of resolving disputes as it is less time consuming and creates an environment which is conducive to peaceful settlement. The amendment to the Act, mandated pre-institution mediation for the aforementioned reasons. Currently the Courts are facing a backlog like never before and in such a situation mandating mediation to disputes which are not urgent in nature and are less grave can provide speedy justice to the disputants and respite to the judiciary.

For this to succeed the regulations, formulated to ensure a settlement procedure which resolves the dispute, need to be robust and effective. The current set of Rules only provide a very general outline to how one should go about mediation. Neutrality is one of the most important aspect of mediation if the mediator cannot be neutral then the session fails to achieve the object of efficient dispute resolution. Moreover, neutrality is often not understood and the universal consensus of neutrality being synonymous to impartiality and independence turns the process into something that can be altered by discourse. In turn the dominant narrative controls the terms of the agreement reached by the parties and this goes to the root of the importance of mediation and invalidates it. Neutrality as impartiality and neutrality as equidistance are not mutually exclusive terms, they are distinct ethics to be followed by the mediator in order to provide for the needs of all the parties to a dispute. This understanding of neutrality seems to be lacking in the Rules. Further, there is no redressal system that has been provided to the disputants and the disputants will be left without any recourse in a situation where in the mediator breached their duties and jeopardized the disputant’s terms in the settlement agreement.

Therefore, to tackle these issues the Indian mediation laws need to provide for a set of guidelines similar to the IBA guidelines. The concept of mediation ethics itself needs to be strengthened to better understand the requirements of a successful mediation session which can allow the parties reach a settlement on their own terms, and the aforementioned Rules need to be looked into to make it more extensive and user-friendly. Neutrality is an important value without which one party will always remain dissatisfied and this will be counterproductive to the idea of Alternative Dispute Resolution. A mediator should not be conflicted or partial and if such is the case then the disputants should be free to remove the mediator or the mediator themselves should resign. Therefore, a mediator must be above suspicion.^[30]

1. Commercial Courts Act, Gazette of India, §12A, 2018. ↑
2. Commercial Courts (Pre-institution Mediation and Settlement) Rules, Gazette of India, §12, 2018. ↑
3. Sara Cobb and Janet Rifkin, Practice and Paradox: Deconstructing Neutrality in Mediation, Law & Social Inquiry, Vol. 16, No. 1 (Winter, 1991), pp. 35-62. ↑
4. Id. ↑
5. Id. ↑
6. Id. ↑
7. Jurgen Habermas, Communication and the Evolution of Society (Boston: Beacon Press, 1979). ↑
8. Christopher Moore, The Mediation Process (San Francisco: Jossey-Bass, 1986). ↑
9. Supra. At 3. ↑
10. Id. ↑
11. Id. ↑
12. Martin Svatoš, Ethics in Mediation: Caesar’s Wife must be above Suspicion, Kluwer Mediation Blog (28^th December, 2018 4:03 PM), http://mediationblog.kluwerarbitration.com/2018/09/20/ethics-mediation-caesars-wife-must-suspicion/. ↑
13. Martin Svatoš, Ethics in Mediation II: Of the Poor Man and the Lizard, Kluwer Mediation Blog (28^th December, 2018 4:03 PM), http://mediationblog.kluwerarbitration.com/2018/11/20/ethics-in-mediation-ii-of-the-poor-man-and-the-lizard/. ↑
14. Id. ↑
15. Id. ↑
16. (Draft) Alternative Dispute Resolution and Mediation Rules, Rule 7, 8, 27(6), 2003. ↑
17. Draft General Scheme of Mediation Bill, Head 7(2), 2012. ↑
18. Companies (Mediation and Conciliation) Rules, §9 §10 §28(f), 2016. ↑
19. Commercial Courts (Pre-institution Mediation and Settlement) Rules, Gazette of India, §12, 2018. ↑
20. Avaneesh Satyang and Sohini Mandal, India: Mandatory Pre-Institution Mediation: Commercial Courts, Mondaq (28th December, 2018 4:03 PM), http://www.mondaq.com/india/x/727214/Arbitration+Dispute+Resolution/Mandatory+PreInstitution+Mediation+Commercial+Courts. ↑
21. Indian Institute of Mediation and Arbitration Rules, Part III, 2017. ↑
22. Id. ↑
23. Id. ↑
24. Supra. At 13. ↑
25. Id. ↑
26. Id. ↑
27. Id. ↑
28. Supra. At 12. ↑
29. Id. ↑
30. Id. ↑