RI needs dispute mediation firm<\/p>\n
By Stefanus Haryanto<\/p>\n
BANDUNG (JP): Recent highly controversial Indonesian Supreme
\nCourt's verdicts have tarnished the court's image and discouraged
\npeople from taking their disputes to the courts.<\/p>\n
The Hanoch Ebe Ohee case is strong evidence of the lack of
\nlegal certainty in Indonesia.<\/p>\n
Hanoch, from Irian Jaya, was awarded damages of Rp 18 billion
\n(US$7 million) by the Supreme Court but failed to get the money
\nbecause a letter from Chief Justice Soerjono declared the verdict
\ncould not be executed.<\/p>\n
Even before this people were reluctant to litigate in
\nIndonesia because it is an expensive, lengthy and complex
\nprocess. Even if a court rules in favor of the plaintiff there is
\nno absolute guarantee the verdict will be executed accordingly.<\/p>\n
In the process of executing a verdict it sometimes happens
\nthat a top Supreme Court official will order the execution be
\nsuspended.<\/p>\n
For business people wanting an efficient and speedy settlement
\nof their disputes, a lengthy and costly litigation process is
\nsomething to be avoided.<\/p>\n
Therefore, alternative dispute resolutions like arbitration
\nand mediation which offer speedy and efficient resolutions are
\ndesirable and conform with people's need for less complex dispute
\nsettlement mechanisms.<\/p>\n
The increasing demand for alternative dispute resolution is
\nevidenced by the number of centers for commercial arbitration and
\nmediation worldwide.<\/p>\n
In the U.S. the use of alternative dispute resolution has
\nincreased dramatically since 1991 when the U.S. Supreme Court in
\nthe case of Gilmer v. Interstate\/Johnson Lane Corp, upheld a
\nmandatory arbitration clause in employment contracts.<\/p>\n
In addition to arbitration, mediation that is a non-binding,
\nvoluntary way of settling disputes is gradually becoming more
\npopular than traditional arbitration where decisions are binding
\nand can be mandatory.<\/p>\n
In highly emotional disputes, such as employment and
\nenvironmental ones, the flexibility of mediation allows for more
\n\"creative\" solutions and makes it easier for the mediator to
\ndiffuse anger and hostility between parties.<\/p>\n
In commercial disputes mediation is also desirable because it
\ncan settle disputes with no one losing. This type of win-win
\nsolution is very appropriate for commercial disputes because the
\ndisputing parties will have no hard-feelings about each other and
\ncan resume their business relationship as usual.<\/p>\n
Businesspeople cannot afford the cost of lengthy and \"self-
\ndestructive\" litigation, especially the social cost of becoming
\nknown as \"conflict-happy\" or litigious.<\/p>\n
In Indonesia, although alternative dispute resolution in the
\nform of negotiation, mediation, and arbitration is recognized and
\nincorporated into legislation, it is not very popular.<\/p>\n
For example, notwithstanding the provisions of the Act number
\n22 of 1957 on Settlement of Employment Disputes, which provides
\nfor disputing parties to settle their dispute through direct
\nnegotiation, mediation by manpower ministry officials or by an ad
\nhoc arbitration, not many employment disputes are settled this
\nway.<\/p>\n
This is quite ironic as Indonesians are notoriously non-
\nlitigious and friendly people. People's reluctance to settle
\ndisputes out-of court through amicable means may reflect their
\nskepticism of the Indonesian justice system. If a Supreme Court
\nverdict can be arbitrarily declared unexecutable what about a
\nvoluntary agreement reached by negotiation or mediation.<\/p>\n
Accordingly, if one party feels that his or her adversary is
\nnot trustworthy, an alternative dispute settlement mechanism is
\nnot worth considering.<\/p>\n
If this situation persists it may add to the problem of the
\nhigh cost economy in Indonesia because every commercial dispute,
\neven the simplest one, is settled through lengthy and costly
\nlitigation. With economic globalization and greater demand of
\nefficiency in business, it is inevitable that Indonesia's
\nbusiness community will have to consider a center for settling
\ncommercial disputes through peaceful and efficient means like
\nmediation or arbitration.<\/p>\n
The Indonesian Board of National Arbitration (BANI) was
\nestablished in 1978 and arbitrates cases on construction,
\nbanking, shipping, leasing, and other commercial disputes. As
\nalternative dispute resolution is not only arbitration, it is
\nhigh time the Indonesian business community considered
\nestablishing a Center for Commercial Mediation which is far more
\nflexible and less formal than arbitration.<\/p>\n
In the United States there are many centers settling disputes
\nthrough mediation. Dominic Bencivenga wrote in the New York Law
\nJournal (Dec. 1996), that in 1995, three New York city lawyers
\nexperienced in mediation established their rare Boutique
\nMediation Firm (BMF). The term \"boutique mediation\" reflects the
\nexcellent services of this firm, since the firm provides neutral
\nand professional mediator(s), who conduct mediation services in a
\nfancy office or apartment furnished with computer and other
\nsophisticated equipment.<\/p>\n
In their first year of operation they handled close to 100
\nmediations, which typically take one or two days. They charge
\nUS$300 an hour for mediation and a daily rate for mediation
\ntraining. In addition to commercial disputes their caseload
\nincludes wrongful dismissals, partnership disputes, age and race
\ndiscrimination and sexual harassment cases.<\/p>\n
In Indonesia where people are not very satisfied with the
\nexisting justice system, the establishment of a Boutique
\nMediation Firm to give professional services for commercial
\nmediation has good prospects. If the disputing parties believe
\nthe firm is run by trustworthy, honest, fair, and creative
\nindividuals, there is no doubt they will enjoy the support of the
\nbusiness community.<\/p>\n
As a way of beginning, BANI, as the existing alternative
\ndispute resolution institution, may initiate the establishment of
\na center for commercial mediation, or simply expand its services
\nto include mediation.<\/p>\n
An Indonesian center for commercial mediation may also have a
\npositive impact on practices in the courts. If the courts have
\n\"competition\", they may improve their services in rendering
\njustice to disputing parties.<\/p>\n
To conclude, it is high time Indonesia had a center for
\nalternative dispute resolution to compete with the courts and to
\nlet \"market mechanism\" improve the judicial system. In this
\nregard, the growth prospects for a Boutique Mediation Firm in
\nIndonesia are very good.<\/p>\n
The writer is a lawyer and ADR specialist based in Bandung.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/ri-needs-dispute-mediation-firm-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }