What is Legal Sanctity

What is the Legal Sanctity of Online ADR?

Arbitration Award & Conciliation Settlement = Court Decree

In India, the following provisions of Statutes recognize and make the ADR mechanism legal.

  • Section 89 of the Civil Procedure Code, 1908 provides that opportunity to the people, if it appears to court there exist elements of settlement outside the court then court formulate the terms of the possible settlement and refer the same for: Arbitration, Conciliation, Mediation or Lok Adalat.
  • The Acts which deals with Alternative Dispute Resolution are Arbitration and Conciliation Act, 1996

The ADR Mechanisms have been well recognized and accepted by the courts. The Courts have now been encouraging the use of ADR in cases where compromise is possible. The effect of an Arbitration Award, which is similar to decision by a Court, has the same effect of a decree and is final, binding and non-challengeable. Similarly the settlement agreements reached through the process of Conciliation or Mediation is deemed to be a decree and is binding.

In India, if the Arbitration Agreement, Conciliation Agreement etc. is compliant with Section 4 & 5 and other applicable provisions contained in Section 10-A & Section 11 - 15 of the Information Act 2008 read with Section 65-A & 65-B of Indian Evidence Act 1872 and Provisions of the Arbitration & Conciliation Act 1996 read with various Supreme Court Judgments, the Online Arbitration Awards, Conciliation Settlements etc., the Online Arbitration, Online Conciliation etc. is legally recognizable & valid and have the same effect of Traditional Arbitral Awards, Conciliation Settlements etc. These Online Awards & Settlements are binding & final.

Legal Support to ADR World Wide

  • The Arbitration and Conciliation Act 1996
  • Section 89 of the CPC 1908
  • Section 65A & 65B of Indian Evidence Act – Admissibility of Electronic Records as evidence
  • Information Technology Act, 2000 based on UNCITRAL Model Law of e-Commerce 1996
    1. Section 3 – Authentication of electronic records
    2. Section 3A – Electronic Signature
    3. Section 4 – Legal recognition of electronic records
    4. Section 5 – Legal recognition of electronic signatures
    5. Section 10A - Validity of contracts formed through electronic means
    6. Section 11-13 – Attribution, acknowledgement and dispatch of electronic records
    7. Section 14 – Secure electronic record
    8. Section 15 – Secure electronic signatures
    9. Chapter IX on cyber contraventions and chapter XI on offences
    10. Section 72 A punishment for disclosure of information in breach of lawful contract
  • Legal Precedents
    1. State of Maharashtra vs Dr. Praful B. Desai
    2. Grid Corporation of Orissa Limited vs AES Corporation
    3. Shakti Bhog vs Cola Shipping
    4. Trimex International vs Vedanta Aluminum Limited

International Instruments Support
  • UNCITRAL Model Law on E-Commerce
  • UNCITRAL Model Law on International Commercial Arbitration
  • UNCITRAL Model Law on use of Electronic Communications in International Contracts
  • UN Convention on Recognition of Enforcement of Foreign Arbitral Awards
  • “Recommendations regarding the interpretation of Article II, Paragraph 2 & Article VII, Paragraph 1 of the Convention on the Recognition and Enforcement of Arbitral Awards”
  • UNCITRAL Model Law on E-Commerce – Legal Recognition of e-Signatures and Electronic Contracts on the same basis as an Agreement concluded in writing
  • Convention on the enforcement of international settlement agreements (Singapore Convention 2018) and related model law 2018