MA Schedule 9 : Amendment to Commercial Courts Act, 2015

Explanation using Example

Example 1: Business Contract Dispute

Introduction: ABC Corp, a manufacturing company, enters into a contract with XYZ Ltd, a supplier, for the delivery of raw materials. Due to a disagreement over the quality of materials delivered, ABC Corp decides to take legal action against XYZ Ltd.

Application: According to Section 12A, Sub-section (1) of the Commercial Courts Act, 2015, as amended by the Mediation Act, 2023, ABC Corp must first exhaust the remedy of pre-litigation mediation before instituting a suit, as there is no urgent interim relief sought.

Outcome: ABC Corp applies for pre-litigation mediation through a mediation service provider authorized under Section 12A, Sub-section (2). The mediation process must be completed within 120 days, with a possible extension of 60 days if both parties agree. If a settlement is reached, it will be documented and signed by both parties and the mediator, as per Section 12A, Sub-section (4).

Conclusion: Compliance with the pre-litigation mediation requirement helps avoid court proceedings and encourages an amicable settlement. Non-compliance could result in the court dismissing the suit until mediation is attempted.

Example 2: Real Estate Dispute

Introduction: John, a property developer, has a dispute with a contractor over the completion timeline of a commercial building project. John wishes to file a lawsuit for breach of contract.

Application: Under Section 12A, Sub-section (1) of the Commercial Courts Act, 2015, as amended, John must first engage in pre-litigation mediation since he is not seeking any urgent interim relief.

Outcome: John approaches the Authority constituted under the Legal Services Authorities Act, 1987, as authorized by Section 12A, Sub-section (2). The mediation must be concluded within 120 days, with a possible 60-day extension. The time spent in mediation will not count towards the limitation period for filing the lawsuit, as per the second proviso of Section 12A, Sub-section (3).

Conclusion: By participating in mediation, John may resolve the dispute without litigation, saving time and resources. If mediation fails, he can proceed with the lawsuit, having fulfilled the legal requirement.

Example 3: Intellectual Property Dispute

Introduction: A tech startup, Innovatech, accuses a competitor, TechSolutions, of infringing on its patented technology. Innovatech plans to file a lawsuit for patent infringement.

Application: As per Section 12A, Sub-section (1) of the amended Commercial Courts Act, Innovatech must first attempt pre-litigation mediation, as no urgent interim relief is involved.

Outcome: Innovatech opts for a mediation service provider under Section 12A, Sub-section (2)(ii). The mediation process is completed within the stipulated 120 days. If a settlement is reached, it will be formalized and signed, as required by Section 12A, Sub-section (4).

Conclusion: Engaging in mediation allows Innovatech and TechSolutions to potentially resolve the dispute without court intervention. Non-compliance with the mediation requirement could delay legal proceedings.