Resolving disputes
Resolving disputes
Given the notorious reputation of the judicial system as one
of the most corrupt institutions in Indonesia, which in turn is
internationally perceived as one of the most corrupt countries in
the world, last week's opening of an independent mediation center
should be welcomed as an alternative dispute resolution
mechanism.
As the experiences of most other countries, even those with
more efficient and credible court systems, have shown, an
effective resolution mechanism for civil and commercial disputes
is essential in preventing major financial hardships and
inconvenience.
Little wonder that in most industrialized nations the business
of mediation has thrived as much faster, more amicable and
cheaper resolution mechanisms for almost all kinds of civil and
commercial disputes, such as those involving contracts,
employment, divorce, personal injury and harassment, have
emerged.
Chief economics minister Dorodjatun Kuntjoro-jakti, who
officially opened the Indonesian Mediation Center, should be
fully aware of the frustration felt by businesspeople,
particularly foreign ones, toward the country's court system. In
fact, the corrupt judicial system has long been one of the
biggest barriers to the new investment that is badly needed to
strengthen the economic recovery.
Different from litigation and arbitration, which involve
judges or arbitrators rendering binding decisions in open
proceedings, mediation is completely consensual and non-
adjudicatory as the process is based on the mutual agreement of
both disputants, who are also responsible for selecting the
mediator.
Most importantly, the proceedings are much faster and, because
the disputants do not have to hire lawyers, the process is much
cheaper. Businesses also often prefer independent mediation
because the proceedings are confidential, so the disputants do
not have to air their laundry in open court. What disputants say
during the mediation sessions cannot legally be revealed outside
of the proceedings or used later in a court of law.
Unlike arbitration or litigation, which may take years due to
the overloaded courts and the long process of appeal, mediation
can be scheduled and completed within days or weeks. Of no less
importance, as the experiences of mediation councils in other
countries have shown, disputants who have freely arrived at their
own solutions through mediation are more likely to follow through
on the results. Litigation or arbitration often causes permanent
animosity between the disputants.
As independence and credibility are the basic assets required
for a mediation council to be effective, the Indonesian Mediation
Center should from the outset focus its attention and resources
on these two principles.
The first requirement for independence is that the center
should be financially autonomous, meaning that its financial
resources should be adequate for it to hire experienced experts
in various fields. Certainly, the credibility of the center will
depend on the reputation, integrity and technical competence of
its mediators.
As a completely new institution, the center needs to launch a
campaign to educate the public, particularly the business
community, about the advantages of mediation.
In the long run, though, the effectiveness of the mediation
center will depend on how the Supreme Court integrates the
mediation process, as an alternative dispute resolution
mechanism, into the country's judicial system.