Conciliation is an effective tool of Alternate Dispute Resolution mechanism. It is well settled mode of peaceful settlement of disputes universally. It is quick better, economical and an effective mode of settlement of dispute.

The new law (in sections 61 to 81 contained in part III) make express provisions as to conciliation by agreement of the parties-a matter on which there has so far been no statute in India.

Unlike an arbitrator, a conciliator does not give a decision but his main function is to induce the parties themselves to come to settlement. An arbitrator is expected to give a hearing to the parties, but a conciliator, does not engage in any formal hearing, though he may informally consult the parties separately or together. The arbitrator is vested with the power of final decision and in that sense it is his contribution that becomes binding. In contract, a conciliator has to induce the parties to come to a settlement by agreement.

An arbitrator generally decides after a context between the parties while in the case of conciliation the final depends on the will of the parties. Therefore, at the end of the proceedings, emotional harmony between the parties may not suffer much, in the case of conciliation.

Under sec 61(1) of the new law, conciliation can be resorted to in relation to dispute arising out of a legal relationship, whether contractual or not.

A party initiating conciliation can, under sec. 62 of the new law, send to the other party a written invitation to conciliation. Conciliation commences when the other party accepts in writing this invitation. If it does not accept it then there will be no conciliation (sec. 62 of the new law).

New Law provides that:

1. There will be only one conciliator, unless the parties agree to two or three.
2. Where there are two or three conciliators, then as a rule they ought to act jointly.
3. Where there is only one conciliator, the parties may agree on his name.
4. Where there are two conciliators, each party may appoint one conciliator.
5. Where there are three conciliators, each party may appoint one, and the parties may agree on the name of the third conciliator, who shall act as presiding conciliator. li>
6. But in each of the above cases, the parties may enlist the assistance of a suitable institution or person.

In sections 65 to 73, the new law contains provisions spread over a number of sections as to the procedure of the conciliator. Their gist can be stated in short form:

1. The conciliator, when appointed may request each party to submit a statement, setting out the general nature of the dispute and the points at issue. Copy is to be given to the other party. If necessary, the parties may be asked to submit further written statement and other evidence.
2. The conciliator shall assist the parties in an independent and impartial manner, in their attempt to reach an amicable settlement.
3. The conciliator is to be guided by the principles of objectivity, fairness and justice. He is to give consideration to the following matters:
   (i) Rights and obligations of the parties.
   (ii) Trade usages, and
   (iii) Circumstances, surrounding the dispute, including previous business practices between the parties (sec. 67 (2) of the new law).
4. He may, at any stage, propose a settlement, even orally, and without stating the reasons for the proposal (section 67 (4))
5. He may invite the parties (for discussion) or communicate with them jointly or separately (sec. 68)
6. Parties themselves must, in good faith, cooperate with the conciliator and supply the needed written material. Provide evidence and attend meetings (section 71)
7. If the conciliator finds that there exist, elements of a settlement which may be acceptable to the parties, then he shall formulate the terms of a possible settlement and submit the same to the parties for their observation,
8. On receipt of the observations of the parties, the conciliator may re-formulate the terms of a possible settlement in the light of such observation.
9. If ultimately a settlement is reached, then the parties may draw and sign a written settlement agreement. At their request, the conciliator can help them in drawing up the same (see section 73
   (1) and 73 (2)).
   (a) The settlement agreement signed by the parties shall be final and binding on the parties (see section 73 (1)).
   (b) The agreement is to be authenticated by the conciliator (see section 73 (4)).
   (c) The settlement agreement has the same status and effect as if it were and arbitrage award rendered by the arbitrage tribunal on a agreed terms (see section 74 read with section 30 of the new law).

The net result is that the settlement can be enforced as a decree of court by virtue of section 36 of the new law.

Under section 72 of the new law, a party may submit to the conciliator his own suggestions for the settlement of a dispute. Such suggestions may by submitted by him on his own initiative or on the conciliator’s request.

The net result of section 66, 67 (2) and section 67 (3) of the new law can be stated as follows:

1. The conciliator is not bound by the code of civil procedure or the evidence act.
2. The conciliator is to by guided by the principles of objectivity, fairness and justice.
3. Subject to the above, he may conduct the proceedings in such manner as he considers appropriate, taking into account.
   (i) the circumstances of the case.
   (ii) wishes expressed by the parties.
   (iii) need for speedy settlement.
4. Factual information received by the conciliator from one party should be disclosed to the other party. So that the other party can his explanation, if he so desired. But information given on the conditions of confidentiality
5. Notwithstanding anything contained in any other law for the time being in force, the conciliator and a party shall keep confidential, all matters relating to the conciliation proceeding. This obligation extends also to the settlement agreement, except where disclosure is necessary for its implementation and enforcement (sec. 75 of the new law).

In any arbitrage or judicial proceedings (whether relating ot the conciliated dispute or otherwise) the party shall not rely on, or introduce as evidence.

1. views expressed or suggestions made by the other party for a possible settlement.
2. admissions made by the other party in the course of conciliation proceedings.
3. proposal made by the conciliator, and
4. the fact that the other party had indicted his willingness to accept a settlement proposal (sec. 81 of the new law)

During the pendency of conciliation proceedings, a party is debarred from initiating arbitral or judicial proceedings on the same dispute, except such proceedings as are necessary for preserving his rights (sec.77 of the new law) (There is no mention of arbitral or judicial proceedings which are already initiated).

Unless otherwise agreed by the parties, the conciliator cannot act as arbitrator, representative or counsel in any arbitral or judicial proceedings in respect of the conciliated dispute. Nor can he be presented by any party as a witness in such proceedings (sec.80 of the new law).

The author is a member of the Institute. The views expressed herein are his personal views and do no necessarily represent the views of the Regional Council