Bargaining as a Core to Mediation



[This article is authored by Anmol Mathur, a penultimate year law student at Symbiosis Law School, Noida]


Keywords: Bargaining, Mediation, Game Theory.


Introduction

Mediation is about reaching a mid-position where all parties benefit from the decision so made. It is largely based on negotiations and bargains that each party is committed to making, to bend the outcome in their favor. Each party weighs the pros and cons that a situation has to offer and subsequently decides their bargain, like what they will have to offer to gain what is favorable. The core objective of this is to minimize the expenditure and delay and maximize the constructiveness of the outcome.


A considerable part of this process is typically achieved by way of bargaining on both ends. The process of mediation offers a neutral third party that only guides the parties through the preferable arguments and is not the ultimate authority. Hence, the aim of the parties is not to convince the mediator of their bid, but the other parties involved.


Structure of Bargaining in Mediation

Most of our social interactions are a process of bargaining to meet our ends, be it the formation of a governmental policy or a negotiation in the international arena. Any exchange situation in which a pair of individuals (or organizations) constructively engage in mutually beneficial trade but possess conflicting interests over the terms of trade is a bargaining situation. For example, in the specific case of Joint Family Partition, the dispute revolved around the disagreement over resource allocation.


According to Dan Reiter, the structure of a bargain over a disagreement flows from a linear model. This line represents the potential benefit that the two principal actors, A and B, seek. Both perceive a potential gain that they sought to achieve, which is represented by 'p’. If ‘p’ is a specific point on the line, for A to obtain a greater benefit, it must be as right as possible and for B to make the most of the situation, it must be as left as possible. However, there is also a cost that is involved. The parties participating in the bargain perennially aim at achieving maximum benefits for minimum costs.



Bargaining Games vis-à-vis Mediation

In a bargaining game, each party has two alternatives:

  1. Insist on incorporating terms that favor their own interests; or

  2. Accept terms that are favorable to the other party.

Now, the first alternative flows from an isolated behavior and ends up in a competitive bargain. The main aim and philosophy of the negotiator here, is to prevent the other party from gaining what they want. According to research conducted by the Economic Research Institute ("EFI") at the Stockholm School of Economics, several behavioral and institutional assumptions are successful in determining a partial solution where a disagreement is majorly on the periphery of distribution, as they have only two alternatives in the said bargaining game. Each party here has a preference as to what, out of all the possible outcomes, would yield them benefits. Mediation is an ongoing process, and the parties' bargaining can be divided into periods. There also exists an institutional assumption that each time the parties participate in a bargain, they must possess all the necessary knowledge about every aspect of it, for the bargain to be legitimate. This depends highly on the ethics of the parties, whether they wish to reveal or conceal all the details. In an isolated bargain, the negotiators may resort to lying, bluffing, stealing, coercion or distraction. All these techniques are used by a competitive negotiator to prevent the opposite party from gaining what he wants for himself.


A mediation process involves both competitive and cooperative negotiations and, more often, the former works better than the latter. It is extremely basic to put into perspective the bargaining model. A competitive bargain is one where a party cannot benefit until the other party incurs a loss. This allows for adjustment in behavior, ethics, and motivation of the parties. Such a bargain is likely to yield results that are accurate and beneficial for the party that opts for it. It also helps in cases where easy manipulation can derail justice or an otherwise healthy dispute resolution. A competitive bargain offers a very balanced bargain, where the parties are sure of their interests. The focus of the mediation changes from “what”, to a very specific matter of “how”. Bargaining games with a competitive insight are often supposed to end with either a winning party or a losing party. However, in the process of mediation, results are only sought after both parties are satisfied. This serves as an advantage over the cooperative style, where it takes an elongated procedure to reach a mid-point. It is more occasionally used in commercial mediations.


The other alternative is duopoly. Many authors have assumed that the players to a bargain to maximize joint profit, would play a couple of strategies and then the parties would divide profits equally between themselves. A cooperative bargain is based on the objective of maximizing social utility. It flows from a continuous process of biding by each party. One party puts forward a bargain and if the bargain is successful in yielding optimal profits, it is accepted by each party. If not, the other party responds to it with a Prisoner’s Dilemma Game. Hence, each step can be divided into:

  1. A bargaining phase in which each party makes a favorable bid.

  2. By a duopoly or prisoner's dilemma game in which each strategy is chosen to benefit its own interests.

Each party goes through an array of compromises to reach a conclusion which is mutually beneficial. In this case, any relationship with the other party serves as a bridge in recognizing the sacrifices that a party must make. It is also the probable solution for a party lacking a strong bargain. This method is beneficial to such parties as it offers some minimal gain in situations where there was no gain possible. The central aim is to reach a solution and prevent prolonged mediation processes.


Mediation: A Bargain in Family Disputes

From time immemorial, mediation has been attached to the peaceful resolution of family or marital affairs. Even the present-day family courts recognize the importance of both counselling and communication in such disputes. Sections 9 (1) and (2) of the Family Courts Act, provide for reasonable out of the court settlement, to keep intact the harmony of a family. Most often, divorce cases are referred for mediation as courts see it as a process guaranteeing optimal results for both parties. Section 23 (2) of the Hindu Marriage Act, 1955 and Section 89 of the Civil Procedure Court (Amendment) Act, 1999, provide for “amicable” solutions before a formal suit.


Conclusion

It would be nothing but empowering for the Indian Courts to make mediation a mandate in family disputes. It would not only shorten a long list of pending cases but also give confidentiality to family matters. Formal court proceedings are lengthy, expensive, and often shred family values. The paramount concern of family courts is dispute resolution in a peaceful way. Mediation offers confidentiality, the space, and the will to figure out what they want from a situation rather than what remedy in law benefits them most. Family Mediators have always helped stir uncomfortable family disputes and reach an amicable solution. In the wake of nuclear families, eroding family values and cultural instincts, it is necessary to protect the vibe of integrity. The legislation for mediation should also be made formal and the doors of legally recognized mediation in India must also be opened. This will yield fruitful results, as mediation will become a more direct process with all its rules and procedures fixed and recognized. It will also mandate certain standards to ensure that the mediators are extremely skilled, to effectively bring about cooperation and coordination between the parties. It will also make it easier to serve a diverse population, such as India, because it will be promoted at the local level as well. However, in this case, both language and accessibility would become barriers. Hence, a step should be taken in the direction of making mediation a major, and not just an alternative way of dispute resolution.









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