The Indian judiciary has been promoting parties to opt for the Alternate Dispute Settlement mechanism before pursuing the traditional judicial mechanism. With respect to family disputes brought before the Courts; mediation or conciliation is advised for a peaceful settlement of the dispute to avoid the adverse effects of the traditional judicial mechanism on the familial ties. In mediation, a neutral third party tries to solve the dispute between the parties and help to come to a consensus and middle ground on their own. Rather than directly imposing a solution, the duty of a professional mediator is to assist the conflicting sides in exploring the interests underlying their positions. As per the situation demands so, the mediator either works together with the parties or separately and tries to help them hammer out a resolution that is sustainable, voluntary, and non-binding. The principle of neutrality is the centre point to the success of mediation.

It is settled under the case Afcons Infrastructure Ltd v. M/s Cherian Varkey Construction, 2010

(7) SCALE 293 that ‘mediation’ and ‘conciliation’ are used synonymously wherein a neutral third party is appointed to facilitate the amicable resolution of the dispute.

Though the Arbitration and Conciliation Act, 1996 does not provide for the qualifications of a Conciliator; it requires the Conciliator to be independent, impartial, fair, objective and give consideration to the rights and obligations of the parties. Hence, a lawyer can also be appointed as a Conciliator, provided he/she undertakes to be guided by the said principles.

One of the major questions unturned is whether a lawyer who has acted as a mediator or conciliator can legally represent one of the parties in the later stages of the same matter?

Though it has been recognised under Section 80 of the Arbitration and Conciliation Act, 1996 that where a lawyer is appointed as the Conciliator, he/she is restrained from representing any of the parties to the dispute (in Court) in any arbitral or judicial proceeding in respect of the dispute that was the subject of the said conciliation proceeding. 

Hence, it has been restricted under Section 80; however, if both the parties to the dispute agree, then the lawyer appointed as the Conciliator may represent any one of the parties concerning the same matter. The waiver is a mandatory requirement in such a situation as there is a conflict of interest as regards the lawyer who has been a conciliator and represents one of the parties in the Court of law thereafter. In any case, a lawyer is bound under Section 2 Rule 4 of the Bar Council of India Rules to disclose to his/her client the connection with the parties or any interest in the matter which is likely to affect the client’s decision to engage the lawyer.

It is settled that a mediator/ conciliator shall avoid a conflict of interest or the appearance of a conflict of interest during and after a dispute resolution. A conflict of interest can arise from involvement by a mediator/ conciliator with the subject matter of the dispute or from any relationship between a mediator/ conciliator and any dispute resolution participant, whether past or present, personal or professional, that reasonably raises a question of impartiality by the mediator/ conciliator.

In Western jurisdictions like the United States, it is a mandatory rule that unless there is a waiver by the parties, that could amount to a conflict of interest in the dispute resolution proceedings. But there is no such explicit guidance which states the Indian scenario related to the situation of waiver of amounting to conflict of interest.

With respect to the international perspective, IBA Guidelines on Conflicts of Interest in International Arbitration adopted by resolution of the IBA Council on 23rd October 2014 states about the position as to the validity and effect of waivers under General Standard 3(a), though the validity and effect of any waiver must be assessed in view of the specific text of the advance declaration or waiver, the particular circumstances at hand and the applicable law.

With respect to India, the situation of waiver has been defined by the Supreme Court in the case Manak Lal v. Dr. Prem Chand 1957 AIR 425. It was observed in this case that “the waiver can be inferred from the failure of the party to take the objection only if and after it is shown that the party knew about the relevant facts and was aware of his right to take the objection. And since the fact of appearance of mediator/ conciliator as legal representative of one of the parties to others and also that it must be deemed to have been conscious of his legal rights, his failure to take the objection before the tribunal creates an effective bar of waiver against him.”