Headway towards alternative dispute resolution

The memorandum of understanding signed by the International Finance Corporation with the Sindh High Court in Karachi on November 12, marked the happy culmination of a strongly motivated effort for putting in place an alternative dispute resolution mechanism for the private sector in Pakistan.
For it provides for establishment of a pilot mediation centre in Karachi, the hub of business and industry. It will be recalled that IFC, the private sector arm of the World Bank group, had been endeavouring to promote the institutionalisation of mediation as an alternative dispute resolution mechanism in the country.
The project's goals, as now enunciated, include easing expensive and lengthy court procedures confronting the private sector, and helping to free it from the constraints of the unpleasant process of complicated litigation. It also seeks to facilitate the release of the appellants' assets blocked up in legal disputes.
The pilot centre is expected to serve as a model for similar centres in other cities. It will be noted that the IFC has found the commercial dispute settlement processes in Pakistan discouraging to market-based growth and to domestic and foreign investment alike. Small and medium businesses commonly face five to 10 years long litigation processes, while the courts remain backlogged with cases.
More to this, it has also been observed that no less than one-third of the court cases happens to be commercial in nature. As such, it goes without saying that in these circumstances both individuals and business firms are left with no choice of recourse to any alternative, when faced with a contract breach, which turns into a disincentive for both foreign and local investors to do business in this country.
Now that the IFC project would be working with the SHC, to support the pilot mediation centre, it can go a long way towards providing the relief the investors have long been aspiring for.
This is not to say that Pakistan has remained oblivious of the need of addressing the predicament of individuals and businesses from protracted delays in litigation of trade-related disputes. An idea of efforts made in that direction may be had from the Chief Justice of Pakistan Iftikhar Hussain's address to the workshop on Alternative Dispute Resolution/Mediation, held in Karachi, in August, under the auspices of IFC.
He had made a pointed reference to the efforts made by the Law and Justice Commission, through its judicial reform proposals, for modernisation of the substantive and procedural law to help accelerate the process of litigation. He had also referred to plans and strategies being worked out by the Supreme Court for expeditious disposal of cases.
Nevertheless, he did concede that under the circumstances one sure way to do so would be the adoption of the ADR methods. While noting that the concept of ADR is not new to the judicial system of the country, he recalled the recommendations of the Law and Justice Commission of Pakistan, leading to the promulgation of Small Claims and Minor Offences Courts Ordinance, 2002, which provides for court "controlled ADR."
It is, however, another matter that this law has proved of little avail in addressing the problems because of a number of factors at work, including prolonged postponement of hearings in such cases.
This would also underline the need of resorting to out-of-court settlement, a remedy which has remained in vogue in the sub-continent for centuries. Needless to point out, this has reference to emergence of the institutions of Jirga and Panchayat, though varying in forms and manifestations from place to place, the degree of difference being attributable to social, cultural and political factors.
Their role has been considerably overshadowed by the thrust of modernisation of the society in the wake of a long process of changes on the political horizon. Nevertheless, what is still left of them, would bring to the fore their direct appeal to the genius of the Pakistani people, as the approach of mediation, has prove more successful in countries with ethnic, cultural and social homogeneity.
Notably, the IFC project will also help institutionalise mediation through training, monitoring, certification, and registration of mediators, for which enough provision has been made in the MOU. This has reference also to the campaign to raise awareness and to promote mediation among the country's legal practitioners and end-users. Little to doubt then that prospects of recourse to ADR will appear brightened with the establishment of the pilot mediation centre.