Resolve corporate disputes through mediation: LHC

ISLAMABAD: The Lahore High Court’s (LHC) Rawalpindi bench issued a landmark judgement on Tuesday on the “doctrine of expeditious resolution” of corporate disputes through mediation.

The judgement, authored by Justice Jawad Hassan, explained the methodology of settling commercial disputes through alternative dispute resolution (ADR).

Justice Hassan handed down the decision on a petition filed by Faisal Zafar and others regarding a dispute related to the management of a pharmaceutical company.

Ahmer Bilal Soofi represented the petitioners.

He argued that the management had committed “certain illegalities” in running the company’s affairs, including non-payment of salary to its employees, non-payment of electricity bills, non-compliance with guidelines given by the Securities and Exchange Commission of Pakistan (SECP), and impracticality of the agreement under the consent decree.

The court concluded that the matter could be resolved through “early neutral evaluation” (ENE) — a form of alternative dispute resolution in which the two parties concerned invite a third one to give an opinion on the merits of their case.

The court observed that the concept of corporate dispute resolution through mediation in commercial matters was not alien to the system.

“It is now a universally accepted method being followed as less expensive, less time-consuming, less cumbersome and ultimately a fruitful mode, commonly known as ADR (Alternative Dispute Resolution)” adding that mediation not only saves time and money but also reduce the load of work in courts.

“It is the most updated way on resolutions based on the divine culture of peace,” said the judgement.

It said that “unlike court proceedings, mediation is a more informal and flexible approach, fostering open communication and creative problem solving.

Published in Dawn, November 29th, 2023