CHAPTER V: MEDIATION
Section 74. Establishment of consumer mediation cell.
This marks the start of the dedicated system for alternative dispute resolution.
74(1) State Level Cells:
- Simple Translation: The State Government must officially establish a Consumer Mediation Cell and attach one to each District Commission and each State Commission within that state.
- Real-World Example: The government in Maharashtra establishes a Mediation Cell in Mumbai, Pune, and Nagpur, and attaches dedicated staff to each city’s District Commission.
74(2) National Level Cells:
- Simple Translation: The Central Government must officially establish a Consumer Mediation Cell and attach one to the National Commission and to each of its regional Benches.
- Real-World Example: A mediation cell is established at the headquarters of the National Commission in Delhi to handle large, complex cases eligible for national-level mediation.
74(3) Composition of the Cell:
- Simple Translation: Each Consumer Mediation Cell will be staffed by such persons as may be defined by the rules established under the Act.
- Real-World Example: The rules might specify that a cell must consist of a Registrar, a certain number of support staff, and a dedicated pool of empanelled mediators.
74(4) Cell Maintenance and Records:
- Simple Translation: Every Consumer Mediation Cell is required to maintain the following official records and lists:
- (a) List of Mediators: A list of all officially approved (empanelled) mediators.
- (b) Case Log: A list of all consumer disputes that the cell has handled.
- (c) Proceedings Record: Official documentation of the mediation process.
- (d) Other Information: Any other data or information specified by regulations.
- Real-World Example: The Delhi State Commission’s Mediation Cell maintains a publicly accessible list of 50 certified mediators, a log showing the outcome of every case (settled/not settled), and notes from the mediation sessions.
74(5) Quarterly Reporting:
- Simple Translation: Each Consumer Mediation Cell must submit a quarterly report (a report every three months) to the Commission (District, State, or National) it is attached to, detailing its activities in the manner specified by regulations.
- Real-World Example: The mediation cell submits a report to the District Commission on January 1, April 1, July 1, and October 1, summarizing the number of cases received and the successful settlement rate for the previous quarter.
Section 76. Nomination of mediators from panel.
This explains how a specific mediator is assigned to a case.
76. Choosing the Right Mediator:
- Simple Translation: When a case is referred for mediation, the Commission (District, State, or National) must select and nominate a person from the officially approved panel of mediators (created under Section 75).
- Requirement: The Commission must specifically consider the person’s suitability for resolving the particular consumer dispute involved.
- Real-World Example: A dispute involves a complex financial scam. The Commission, when nominating a mediator, will choose one from the panel who has a background in finance or banking, rather than one who specializes in construction disputes, to ensure the best chance of settlement.
Section 77. Duty of mediator to disclose certain facts.
This ensures the mediation process is transparent and unbiased.
77. What the Mediator Must Reveal:
- Simple Translation: A mediator has a mandatory duty to disclose (make known) any facts that might compromise their ability to be neutral. These facts include:
- (a) Conflicts of Interest: Any personal, professional, or financial stake they have in the outcome of the dispute.
- (b) Justifiable Doubt: Any circumstance that might make either party reasonably doubt the mediator’s independence or impartiality (fairness).
- (c) Other Facts: Any other facts that may be specified by the official regulations.
- Real-World Example: The assigned mediator realizes he is a distant relative of the owner of the company being sued. He must immediately disclose this relationship to the Commission and both parties, even if he feels he can remain impartial.
Section 78. Replacement of mediator in certain cases.
This allows for the removal of a mediator if a conflict of interest is found.
78. When a Mediator Gets Swapped Out:
- Simple Translation: If the Commission is satisfied, based either on the mediator’s own disclosure (Section 77) or information received from one of the parties or any other source, that the mediator is compromised, the Commission must replace that mediator with another one after giving the original mediator a chance to be heard.
- Real-World Example: During mediation, the consumer discovers the mediator previously worked as a legal consultant for the opposite party’s firm. The consumer reports this to the Commission, which, after hearing the mediator’s defense, decides to remove and replace him to ensure the process’s integrity.
Section 79. Procedure for mediation.
This outlines the setting and general rules for the mediation session.
79(1) Location:
- Simple Translation: The mediation process must take place in the Consumer Mediation Cell attached to the relevant Commission (District, State, or National).
- Real-World Example: The mediation session for a case filed in the District Commission is held in a dedicated conference room within the District Commission building, designated as the Mediation Cell.
79(2) Guiding Principles (Fairness and Context):
- Simple Translation: The nominated mediator must follow the principles of natural justice (fairness, no bias, hearing both sides) while conducting the mediation. They must also consider several relevant factors:
- The rights and obligations of the parties.
- The common practices and customs of the trade (if any).
- The circumstances that originally led to the dispute.
- Any other relevant factors the mediator thinks are necessary.
- Real-World Example: A dispute over delayed delivery during a festival season. The mediator ensures both the buyer and the seller are heard fairly and considers the usage of trade—the normal delay expectations during that specific festival period—to guide the settlement discussion.
79(3) Conduct and Timeline:
- Simple Translation: The mediator must conduct the mediation process within the time limit and in the manner specified by the official regulations.
- Real-World Example: The regulations state that a mediation session must be completed within 60 days of referral. The mediator structures the meetings and communications to ensure the deadline is met.
Section 80. Settlement through mediation.
This details the two possible outcomes of the mediation process: reaching an agreement or failure to settle.
80(1) Successful Settlement:
- Simple Translation: If the mediation results in an agreement (a settlement) between the parties—whether for all issues or just some of the issues—the terms of that agreement must be written down and signed by the parties involved or their authorized representatives.
- Real-World Example: A customer agrees to accept a 50% refund and a store voucher for the rest of the product value. The mediator writes this down, and both the customer and the company manager sign the document.
80(2) Reporting the Settlement:
- Simple Translation: The mediator must prepare an official settlement report and then send this report, along with the signed agreement, to the Commission that originally referred the case.
- Real-World Example: After the customer and company sign the agreement, the mediator creates a one-page report confirming the date and terms of the settlement and submits both documents to the District Commission.
80(3) Failure to Settle:
- Simple Translation: If no agreement is reached within the specified time, or if the mediator believes that a settlement is simply not possible, the mediator must prepare a report stating this and submit it to the referring Commission.
- Real-World Example: After three joint sessions, the buyer insists on a full refund, and the seller insists on a replacement, with no compromise possible. The mediator ends the process, writes a report stating “Settlement Not Possible,” and sends it back to the Commission.
Section 81. Recording settlement and passing of order.
This section explains how the official court process handles the outcome of mediation.
81(1) Recording the Full Settlement:
- Simple Translation: If the mediator successfully achieved a full settlement (Section 80(1)), the Commission (District, State, or National) must review the settlement report and the signed agreement. Within seven days of receiving that report, the Commission must pass an order officially recording the settlement and dispose of (close) the consumer dispute accordingly.
- Real-World Example: The District Commission receives a report on Monday confirming a builder and buyer settled their dispute over compensation. By the following Monday, the Commission must issue a formal order that legally ratifies the terms of the settlement, making it binding.
81(2) Recording the Partial Settlement:
- Simple Translation: If the dispute was only partially settled (e.g., some, but not all, issues were agreed upon), the Commission must officially record the settlement for the issues that were agreed upon. The Commission will then continue to hear (proceed with the trial on) the remaining issues that were not resolved through mediation.
- Real-World Example: In a case against an airline, the mediation resolves the refund amount, but the issue of compensation for mental agony remains unsettled. The Commission records the refund amount as settled and proceeds to trial only on the mental agony compensation issue.
81(3) Failure to Settle:
- Simple Translation: If the mediation process failed to settle the consumer dispute (Section 80(3)), the Commission must simply continue to hear the case as if mediation had never happened, addressing all the issues involved.
- Real-World Example: The mediator reports that the two parties could not agree. The Commission immediately lists the case for the next hearing, continuing the full adversarial process.