1. INTRODUCTION

1.1 What are consent awards?

Consent awards or typically refer to legal agreements or settlements reached between two parties involved in a dispute, particularly in arbitration or alternative dispute resolution (ADR) proceedings such as Arbitration, Mediation and Conciliation. These awards are essentially the outcome of the parties' mutual agreement to resolve their differences without the need for a full arbitration hearing or a court judgement. What makes these awards different from ''Normal arbitration awards'' is that the ''arbitral tribunal does not consider the dispute on merits but puts the parties' agreement into the shape of an award.[1]''

An overview of key points regarding consent awards is as follows-

1.2 Process of obtaining consent awards

1.2.1 Agreement to Arbitrate or Mediate

Parties involved in a dispute agree to resolve their differences through arbitration or mediation rather than pursuing litigation. This agreement may be part of a contract or entered into voluntarily after a dispute arises.

1.2.2 Selection of Arbitrator or Mediator

The parties select a neutral third party, either an arbitrator (for arbitration) or a mediator (for mediation), who will facilitate the resolution process. The chosen individual should be impartial and have expertise in the subject matter of the dispute. The individual must also follow all the Mediation/Conciliation rules[1] according to the country that they reside in. Though the mediation rules are similar all over the world, there may be minor changes.

1.2.3 Initial Meeting or Hearing

The process typically starts with an initial meeting or hearing where the arbitrator/mediator outlines the procedures, explains the rules, and sets the tone for the proceedings. This phase may involve establishing timelines, discussing confidentiality, and clarifying the issues in contention.

1.2.4 Presenting Arguments and Evidence

Each party presents its case, arguments, and evidence supporting its position. This phase allows parties to articulate their perspectives and present relevant documentation or witnesses to support their claims.

1.2.5 Negotiation and Discussion

In mediation, the mediator facilitates discussions between parties, encouraging them to explore options and negotiate a mutually agreeable solution. In arbitration, the arbitrator may conduct separate meetings with each party to discuss potential resolutions or clarification of issues. Negotiation is at the core of conciliation. The conciliator guides the negotiation process, helping parties focus on their shared interests and finding common ground for agreement. They may employ various techniques such as reframing issues or using principled negotiation strategies, to facilitate constructive dialogue while remaining neutral throughout the process.

1.2.6 Drafting the consent award [2]

If the parties reach an agreement through mediation or arbitration, the terms are outlined in a consent award. This document encapsulates the agreed-upon terms, signed by both parties, and often includes the agreed resolution, terms of settlement, any necessary actions or payments and duration or timelines of compliance. Drafting the consent award in conciliation involves meticulous attention to detail, ensuring that the agreed-upon terms are accurately documented in a legally binding format. This final document stands as a testament to the resolution achieved through the conciliation process, providing a reference for the parties involved and a basis for enforcement if necessary.

1.2.7 Review and Finalizaion

The draft consent award is reviewed by both parties and their legal representatives to ensure accuracy and completeness. Once any necessary revisions are made and both parties are satisfied, the consent award is finalized and signed.

1.2.8 Enforcement and record keeping

Once signed, the consent award becomes legally binding. If one party fails to comply with the terms, the other party can seek enforcement through the courts. And if the consent award contains illegal terms then the arbitrator may be held liable as he is the one who has drafted the award[3].The final consent award is usually filed with the relevant court or arbitration institution for record-keeping purposes. It serves as evidence of the agreed-upon resolution and can be enforced if needed.

1.2.9 Conclusion

Obtaining consent awards involves a structured process of negotiation, discussion, and documentation to reach a mutually agreed resolution outside the courtroom. It provides a formalized and enforceable means of settling disputes, offering parties a degree of control over the outcome while avoiding other complexities and costs of litigation.

1.3 Legal aspects and Enforceability

The binding nature of the award is such that once both the parties consent and sign the contract, the agreement becomes legally binding. These consent awards are generally enforceable in the same manner as arbitration awards or court judgements. As mentioned earlier, if one party fails to comply, the other can seek enforcement through legal means. The parties may also seek legal counselling to ensure that the terms are fair and legally sound before consenting to the award.

1.4 Application and Context

These awards are mainly used in Commercial and International disputes. Consent awards are commonly used in Commercial disputes to swiftly resolve conflicts, allowing businesses to continue operations without significant disruptions. And consent awards are used in International disputes due to the complexity of cross-border issues and time constraints as mentioned earlier.

1.5 Forms of Settlements

There are 2 types of settlements, Global Settlements and Partial Settlements. A global settlement refers to an agreement that comprehensively resolves all aspects of a dispute between parties. It involves reaching a resolution on every issue, claim, or component of the dispute in question. Conversely, a partial settlement addresses only specific aspects or issues within a broader dispute. It involves resolving some, but not all, of the claims or issues raised between the parties.

1.6 Practical Applications and Challenges

Consent awards might be challenging in cases involving multiple parties, intricate issues, or varying interests. While these awards are definitely beneficial, they might conflict with public interest or disclose public obligations in some cases. The award must comply legal principles and not violate public policy or statutory rights.

2. CONCLUSION

Consent awards serve as powerful instruments for dispute resolution, offering parties a swift and customised resolution process. However, their effectiveness depends on the fairness, clarity, and enforceability of the terms agreed upon. Parties must approach these agreements with legal counsel and a thorough understanding of their implications to ensure a satisfactory and enduring resolution.

3. CITATIONS

1. Consent awards in international arbitration, available at (https://core.ac.uk/download/pdf/228600105.pdf), last visited(14-12-2023).

2. Drafting arbitral awards, available at (https://acica.org.au/wp-content/uploads/2020/04/guideline-10-drafting-arbitral-awards-part-i-general-2016.pdf), last visited(15-12-2023).

3. The enforcement of consent awards in commercial arbitration (https://nysba.org/NYSBA/Sections/International/Awards/2016%20Pergam%20Writing%20Competition/submissions/Carr%20Kaitlyn.pdf), last visited(15-12-2023).