Conciliation : Appointment Process and Communication with the Parties

The appointment and communication processes in conciliation are designed to be much less formal than arbitration, emphasizing the voluntary nature of the process. In India, these are governed by Sections 64, 68, and 69 of the Arbitration and Conciliation Act, 1996.

I. The Appointment Process (Section 64)

The appointment of a conciliator relies entirely on party autonomy. The process follows these steps:

1. Number of Conciliators

Parties must first decide how many conciliators will handle the dispute. Unlike arbitration (where an odd number is mandatory), parties can agree on:

• A Sole Conciliator: Usually chosen mutually.

• Two Conciliators: Each party appoints one.

• Three Conciliators: Each party appoints one, and the parties agree on the third.

2. Methods of Appointment

• Direct Mutual Agreement: Parties exchange names and agree on a person (or persons) to act as conciliator(s).

• Request for Recommendation: A party may ask an institution (like a Chamber of Commerce or an ADR center) to recommend suitable names.

• The List Procedure: An institution sends an identical list of names to both parties. Parties cross out names they dislike and rank the rest. The institution then appoints the highest-ranked person accepted by both.

II. Communication with the Parties (Sections 68 & 69)

Once appointed, the conciliator acts as the "bridge" between the parties. The law provides specific rules for how this communication should flow:

1. The Written Statement (Section 65)

The conciliator may request each party to submit a brief written statement describing the general nature of the dispute and the points at issue. Each party must send a copy of their statement to the other party.

2. Freedom of Communication (Section 69)

The conciliator is not bound by the strict rules of the Code of Civil Procedure. They may:

• Communicate with the parties orally or in writing.

• Meet with the parties together or separately (private caucuses).

• Determine the place and time of meetings, after consulting with the parties.

3. Disclosure of Information (Section 70)

This is a critical procedural rule. When the conciliator receives information about the dispute from one party, they must disclose the substance of that information to the other party so they have a chance to explain.

• The Exception: If a party gives information to the conciliator subject to a specific condition that it be kept confidential, the conciliator must not disclose that specific information to the other party.

4. Role in Proposing Settlements (Section 67)

The conciliator does not just listen; they can communicate their own observations. At any stage of the proceedings, the conciliator may make proposals for a settlement of the dispute. These proposals do not need to be in writing or accompanied by a statement of reasons.