MA Section 5 : Pre-litigation Mediation

Explanation using Example

Example 1: Commercial Dispute Between Two Companies

Introduction: Company A and Company B are involved in a commercial dispute over a contract breach. Both companies are considering litigation but want to explore pre-litigation mediation as per the Mediation Act, 2023.

Application: According to Section 5(1) of the Mediation Act, 2023, the parties may voluntarily and with mutual consent engage in pre-litigation mediation. Since this is a commercial dispute, they must also consider Section 12A of the Commercial Courts Act, 2015, if the dispute involves a Specified Value.

Outcome: The companies agree to appoint a mediator empanelled by a court-annexed mediation centre as per Section 5(3)(ii). They successfully reach a settlement, avoiding the time and cost of litigation.

Conclusion: By complying with the Mediation Act, 2023, both companies resolve their dispute efficiently. Non-compliance could have led to prolonged litigation and increased legal costs.

Example 2: Personal Injury Claim from a Car Accident

Introduction: Mr. X is involved in a car accident and files a compensation claim with the Claims Tribunal. The parties fail to reach a settlement under Section 149 of the Motor Vehicles Act, 1988.

Application: As per Section 5(6) of the Mediation Act, 2023, the Claims Tribunal refers the parties to mediation. A mediator from ...

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