LOK ADALAT-JUSTICE THROUGH MEDIATION

Constituting Enactment:

The Legal Services Authorities Act, 1987 (Central Act 39 of 1987)

Relevant portions of the statute:

Chapters VI & VIA of the Act.

Introduction

“Lok Adalat” is an old form of adjudicating system which prevailed in ancient India. From there we moved to reach the present day judicial system. But today, it is a fact that, most litigations remain in courts for numerous years. The judicial system has become identical to an intricate cobweb where litigants are trapped for their entire lifetimes. In this scenario, the Parliament passed legislation viz. The Legal Services Authorities Act, 1987 (Central Act 39 of 1987) (Hereinafter to be mentioned as ‘the Act’) In order to curb the enormous increase in the backlog of pending cases, the old system of Lok Adalat is reintroduced for the resolution of disputes. “Lok Adalat” means “People’s Court”. Lok Adalat is an Alternate Dispute Resolution System (ADR System) having the backing of the law.

Salient features of Lok Adalat

1) It is based on settlement or compromise reached through systematic negotiations

2) It is a win – win system where all the parties to the dispute have something to gain.

3) It is one among the Alternate Dispute Resolution (ADR) systems. It is an alternative to “Judicial Justice”

4) It is economical – No court fee is payable. If any court fee is paid, it will be refunded.

5) The parties to a dispute can interact directly with the presiding officer, which is not possible in the case of a court proceeding.

6) Lok Adalat is deemed to be civil court for certain purposes.

7) Lok Adalat is having certain powers of a civil court.

8) The award passed by the Lok Adalat is deemed to be a decree of a civil court.

9) An award passed by the Lok Adalat is final and no appeal is maintainable from it.

10) An award passed by the Lok Adalat can be executed in a court.

11) The award can be passed by Lok Adalat, only after obtaining the assent of all the parties to dispute.

12) Code of Civil Procedure and Indian Evidence Act are not applicable to the proceedings of Lok Adalat.

13) A Permanent Lok Adalat can pass an award on merits, even without the consent of parties. Such an award is final and binding. From that no appeal is possible.

14) The appearance of lawyers on behalf of the parties, at the Lok Adalat is not barred. (Regulation 39 of the Kerala State Legal Services Authority Regulations, 1998.

Organisation of Lok Adalat

(Section 19 of the Act)

- The State Authority and District Authority, Supreme Court Legal Services Committee, High Court Legal Services Committee and Taluk Legal Services Committee (mentioned in Section 19 of the Act) can organize Lok Adalats at such intervals and places as may be deemed fit.

- Every Lok Adalat so organized shall consist of: (a) Serving or retired judicial officers, (b) other persons, as may be specified.

The experience and qualification of “other persons” in a Lok Adalat conducted by Supreme Court Legal Services Committee shall be prescribed by the Central Government in consultation with the Chief Justice of India. At present, Rule 13 of the National Legal Services Authorities Rules, 1995 prescribes such experience and qualifications as:

(a) A member of the legal profession; or

(b) A person of repute who is specially interested in the implementation of the Legal Services Schemes and Programmes; or

(c) An eminent social worker who is engaged in the upliftment of weaker sections of people, including Scheduled Castes, Scheduled Tribes, women, children, rural and urban labour.

The experience and qualification of “other persons” mentioned in clause (b) shall be prescribed by the State Government in consultation with the Chief Justice of High Court. At present, Rule 13 of the Kerala State Legal Services Authorities Rules, 1998 prescribes the experience and qualifications as:

(i) Eminent social workers who are engaged in the upliftment of Scheduled Castes, Scheduled Tribes, women, children, rural and urban labour and other weaker sections of the society;

(ii) Advocates of standing; or

(iii) Persons of repute who are specially interested in the implementation of the Legal Services Schemes and programmes.

Definition of Court

Section 2 (1) (aaa) of the Act

“Court means a civil, criminal or revenue court and includes any tribunal or any other authority constituted under any law for the time being in force, to exercise judicial or quasi-judicial functions.”

Jurisdiction of Lok Adalat

(Sub Sec 5 of Sec 19 of the Act)

A Lok Adalat shall have jurisdiction to determine and to arrive at a compromise or settlement between the parties to a dispute in respect of:

(i) any case pending before; or

(ii) any matter which is falling within the jurisdiction of, and is not brought before,

any court for which the Lok Adalat is organised.

- The Lok Adalat can compromise and settle even criminal cases, which are compoundable under the relevant laws.

Cognizance of Pending Cases & Determination

(Sec 20 of the Act)

A. On Application:

(i) When all the parties to the case agree for referring the case to Lok Adalat, or

(ii) When one of the party to the case makes an application to court, praying to refer the case to Lok Adalat and the court is prima facie satisfied that there are chances for settlement

B. Suo Moto: Where the court is satisfied that the matter is an appropriate one to be taken cognizance of, by the Lok Adalat.

Then, the court shall refer the case to the Lok Adalat, after giving a reasonable opportunity for hearing to all the parties.

Further, the Authority or Committee organising Lok Adalat may, on application from any party to a dispute, refer the said dispute to Lok Adalat, after giving a reasonable opportunity for hearing to all the parties.

- Lok Adalat shall proceed to dispose of a case refereed to it expeditiously.

- Shall be guided by principles of law, justice, equity and fair play.

- Shall yearn to reach a settlement or compromise between parties.

- When no compromise or settlement is accomplished, the case is to be returned to the court which referred it. Then the case will proceed in the court from the stage immediately before the reference.

Passing of the Award

(Sec 21 of the Act and Regulations 33 & 34 of The Kerala State Legal Services Authority Regulations, 1998)

- Every award of Lok Adalat shall be deemed to be a decree of a civil court.

- Every award shall be signed by all the parties to the dispute and the panel constituting the Lok Adalat.

- Every award shall form part of the judicial records.

- Every award shall be categorical and lucid.

- Every award shall be in the regional language or in English.

- A certified copy of the award will be given free of cost, to all the parties.

- Every award made by Lok Adalat shall be final and binding on all the parties to the dispute, and no appeal shall lie to any court against the award.

- If a pending case is settled at Lok Adalat, any court fee already paid will be refunded as provided by the Court Fees Act, 1870.

Powers of Lok Adalat

(Sec 22 of the Act)

(1) The Lok Adalat shall have the powers of a civil court under the Code of Civil Procedure, 1908, while trying a suit, in respect of the following matters.

(a) Power to summon and enforce the attendance of any witness and to examine him/her on oath.

(b) Power to enforce the discovery and production of any document.

(c) Power to receive evidence on affidavits,

(d) Power for requisitioning of any public record or document or copy thereof or from any court.

(e) Such other matters as may be prescribed.

(2) Every Lok Adalat shall have the power to specify its own procedure for the determination of any dispute coming before it.

(3) All proceedings before a Lok Adalat shall be deemed to be judicial proceedings within the meaning of Sections 193, 219 and 228 of IPC

(4) Every Lok Adalat shall be deemed to be a

Civil Court

for the purpose of Sec 195 and Chapter XXVI of Cr.P.C.

Permanent Lok Adalat

(Hereinafter mentioned as ‘PLA’ - Chapter VI A of the Act)

- Chapter VI A was newly added by Amendment Act, 2002, introducing the concept of Permanent Lok Adalat.

- The Central or State Authorities may establish by notification, Permanent Lok Adalats at any place, for determining issues in connection to Public Utility Services.

- Public Utility Services include: (1) Transport service, (2) Postal, telegraph or telephone services, (3) Supply of power, light and water to public, (4) System of public conservancy or sanitation, (5) Insurance services and such other services as notified by the Central or State Governments.

- PLAs have the same powers that are vested on the Lok Adalats, mentioned under Section 22(1) of the Act.

- The first PLA in Kerala was setup at Thiruvananthapuram It has jurisdiction over the districts of Thiruvananthapuram, Kollam and Pathanamthitta. Permanent Lok Adalats are now proposed for Kochi and Kozhikode districts too.

Organisational Structure of Permanent Lok Adalat

(Section 22B (2) of the Act)

Chairman

A person who is or has been a district Judge or Additional District Judge or has held judicial office higher in rank that that of a District Judge, shall be the Chairman.

Members

Two other persons having adequate experience in Public Utility Service to be nominated by Central Government on the recommendation of Central Authority and by the State Government on the recommendation of the State Authority.

Cognizance of Pending Cases by Permanent Lok Adalat

(Sec 22C of the Act)

Any party to a dispute can apply to PLA for settlement of a dispute in respect of a public utility service, which is not pending before any court.

PLA does not have jurisdiction to entertain disputes involving offences which are not compoundable.

PLA does not have jurisdiction to entertain a matter where the value of the property involved exceeds ten lakhs, which limit can be enhanced as provided for.

Once, an application is preferred to PLA for determination of a dispute, no party to such application can invoke the jurisdiction of any court in the same dispute.

Procedure by Permanent Lok Adalat for Determination

(Sec 22C & 22D of the Act)

Where the PLA receives an application for determination of a dispute,

1. The PLA should direct each party to file before it a written statement stating therein, all the facts and the nature of the dispute, points or issues and the grounds in support or opposition. PLA may require the parties to file additional statements at any stage.

2. The party may also file any document or such other evidence, in proof of such facts and grounds urged.

3. The copy of the written statement and the documents or such other evidence filed has to be sent to the other parties to the application.

4. When the statement and additional statement and reply if any are filed, PLA shall conduct conciliation process between parties to the application, as it thinks fit, considering the circumstances of the dispute.

5. PLA should assist the parties in their attempt to reach an amicable settlement, in an independent and impartial manner. Every party is duty bound to co-operate in good faith, in the conciliation process.

6. If after the conciliation process, the PLA is of an opinion that there exists elements of settlement in such proceedings, which may be acceptable to the parties, PLA may formulate the terms of a possible settlement of the dispute and give it for the consideration of the parties. If the parties are agreeable to the same, they shall sign the same and PLA shall pass an award in terms of the settlement agreement.

7. If the parties are not agreeable to the settlement formulated, if the dispute is not an offence, then the PLA should decide the dispute on merits.

8. PLA shall, while conducting conciliation proceedings or deciding a dispute on merit, shall be guided by the principle of natural justice, objectivity, fair play, equity and other principles of justice.

9. The PLA, when deciding a dispute on merit, shall not be bound by the Code of Civil Procedure, 1908 and the Indian Evidence Act, 1872.

10. Every award made by the PLA shall be by the majority of the persons constituting the PLA.

11. The award rendered by PLA shall be deemed to be a decree of a civil court and shall be final. The PLA may transmit the award to the court having local jurisdiction for execution.

Criticism: Permanent Lok Adalat

(Sub Sections (1), (2) & (8) of 22C R/w 22D and 22E of the Act)

The right to appeal is one of the most basic features of any sound legal system. It sprouts from the principle ‘to err is human’, It recognizes the fact that it is impossible to be infallible always. Lok Adalats cannot proceed to pass awards unless the parties to a dispute under its consideration, agrees to the passing of an award. In such a situation, by agreeing, the parties are estopping themselves from challenging it afterwards. In that case, denial of an appeal provision can well be justified. But a Permanent Lok Adalat can proceed to dispose of a matter referred to it even without the consent of the parties to such dispute. And the PLA does not have to go by the rules of evidence contained in The Indian Evidence Act. Moreover, a party can be drawn to PLA, despite his wishes. In such a situation, denying a chance to appeal may not be in consonance with our most cherished legal principle: “Justice should not only be done, but should manifestly and undoubtedly be seen to be done." Lord Hewart CJ in Rex v. Sussex Justices, Ex parte McCarthy [1923] All ER 233

Important Precedents

a) Thomas v. Thomas Job 2005 (3) KLT 1042 SC

The award of the Lok Adalat is fictionally deemed to be decrees of the Court and therefore the courts have all the powers in relation thereto as it has in relation to a decree passed by itself. This includes powers to extend time in appropriate cases. The award passed by the Lok Adalat is the decision of the Court itself though arrived at by a simpler method of conciliation instead of the process of arguments in court. The effect is the same. The effort shall be to give life and enforceability to a compromise award and to defeat it on technical grounds. The award of Lok Adalat is final and permanent which is equivalent to a decree executable and the same is ending to the litigation among parties. Held 2003 (3) KLT 936 not good law.

b) Thomas v. Florence 2006 (3) KLT 717

Which court to execute the award of the Lok Adalat? It would be the court of competent jurisdiction that would have entertained the matter for trial, had the matter not been settled in the Lok Adalat.

c) Krishnakumari v. Venugopal 2005 (2) KLT 185

Settlement arrived at by the Lok Adalat shall be guided by the principles of natural justice, equity, fair play and other legal principles. Lok Adalats are not meant to bring down the pendency of cases somehow. When matters over which Family Courts are having jurisdiction are dealt with by Lok Adalats, the decisions arrived at must be in consonance with the provisions contained in Section 9 of the Family Courts Act. Award can be interfered with by the High Court, under Articles 226 and 227 of Constitution, if a patent illegality is involved.

d) Chandran v. Prakasan 2005 (4) KLT 1038

The finality of the award of the Lok Adalat will not bridle the power of the Court to re-determine or cancel the maintenance as provided for u/Sec 127 of Cr.P.C.

e) State of Karnataka v. Gurunath 2000 Crl.L.J. 1192 (Karnataka)

As per the charge sheet, the offence is u/Sec 326 which is not compoundable. But the medical certificates make out only an offence u/Sec 324 which is compoundable. The reference to Lok Adalat is valid.

f) State of Punjab v. Phulan Rani AIR 2004 SC 4105 / 2004 (7) SCC 555

Difference between the terms ‘compromise’ and ‘settlement’. Compromise means settlement of difference by mutual concessions. Settlement denotes termination of legal proceedings by mutual settlements.

g) Moni Mathai & Others v. Federal Bank Ltd. 2003 (1) KLJ 406

Lok Adalat shall not take advantage of ignorance of a party and close their eyes to the legal effect of the terms of settlement.

h) Sailendra Narayan Bhanja Deo v. The State of Orissa AIR 1956 SC 346 (Cn.Bch)

The judgment by consent or default is as effective an estoppel between the parties as judgment whereby the court exercise its mind on a contested case.

Debatable Questions

1. There is a boundary dispute between A and B who are neighbors. B preferred an application before Lok Adalat. A received the notice for appearance before the Lok Adalat, on a particular date. A opts not to attend the Lok Adalat.

(a) Can the Lok Adalat proceed to pass an award, making A exparte?

(b) Can Lok Adalat compel the presence of A before it?

2. A complaint filed by A against B is pending before Consumer Redressal Forum, (CDRF) Ernakulam. Can CDRF refer the matter to the Lok Adalat without the concurrence of A and B?

3. A is charged with an offence punishable under Section 413 of the Indian Penal Code. (Assisting in the concealment of stolen property). The property stolen was belonging to B. The judge feels that there is a chance for settlement between A and B. Can the matter be referred to the Lok Adalat?

4. A agreed to purchase the 25 cents of landed property along with a three-storied building therein, belonging to B located at MG Road, Ernakulam. They entered into a written agreement for sale, fixing the purchase price as 10 crores. A pays three crores rupees to B, as advance. The date for sale was fixed as three months thereafter. B later retracted and disagrees to sell. Can A prefer an application before Lok Adalat seeking settlement of this dispute?

5. A and B are husband and wife. A files a petition for divorce against B before the Family Court. Can the judge, refer the same to the Lok Adalat?

6. There is a dispute between A, B, C, D and E. Through mediation, they arrived at a settlement. Now they want to resolve it by entering into a written agreement. They sought the advice of X, a student of Govt. Law College, Ernakulam. He advised that, instead of entering into an agreement in the usual mode, they can take their dispute to the Lok Adalat, where they can obtain an award incorporating their settlement. How good is this advice?

Amendments to the Act

1. The Legal Services Authorities (Amendment) Act, 1994

2. The Persons with Disabilities (Equal Opportunities) Protection of Rights and Full Participation Act, 1995

3. The Legal Services Authorities (Amendment) Act, 2002

Relevant Portions in The Code of Civil Procedure, 1908

(Section 89, 96(3) & Order 23 Rule 3 of CPC)

Section 89 - Settlement of disputes outside the Court:

(1) Where it appears to the court that there exist elements of a settlement which may be acceptable to the parties, the court shall formulate the terms of settlement and give them to the parties for their observations and after receiving the observation of the parties, the court may reformulate the terms of a possible settlement and refer the same for-

(a) arbitration;

(b) conciliation

(d) mediation.

(2) Where a dispute had been referred-

(a) for arbitration or conciliation, the provisions of the Arbitration and Conciliation Act, 1996 shall apply as if the proceedings for arbitration or conciliation were referred for settlement under the provisions of that Act.

(b) to Lok Adalat, the court shall refer the same to the Lok Adalat in accordance with the provisions of sub-section (1) of section 20 of the Legal Services Authority Act, 1987 and all other provisions of that Act shall apply in respect of the dispute so referred to the Lok Adalat;

(c) for judicial settlement, the court shall refer the same to a suitable institution or person and such institution or person shall be deemed to be a Lok Adalat and all the provisions of the Legal Services Authority Act, 1987 shall apply as if the dispute were referred to a Lok Adalat under the provisions of that Act;

(d) for mediation, the court shall effect a compromise between the parties and shall follow such procedure as may be prescribed.]

1. Sec. 89 was repealed by Act 10 of 1940, sec. 49 and Sch. II and again added by Act No. 46 of 1999, section 7 (w.e.f. 1-7-2002).

Sub Section (3) Section 96:

“No appeal shall lie from a decree passed by the Court with the consent of parties.”

Or 23 Rule 3 provides for compromise of suit:

“Where it is proved to the satisfaction of the Court that a suit has been adjusted wholly in part by way of any lawful agreement or compromise, written and signed by the parties, the Court after satisfying itself about the settlement, it can convert the settlement into a judgment decree.”

Relevant Provision of Cr.P.C

Section 320: Compounding of offences

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LOK ADALAT-JUSTICE THROUGH MEDIATION

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