Current Status of Alternative Dispute Resolution in Ethiopia[1]
Introduction
Alternative dispute resolutions (ADR) are a mechanism to seek solutions for disputes other than the conventional, formal, coercive institution of modern states referred to as court. Courts are the ultimate legitimate recourse to conflicts. Courts exercise their constitutional judicial power to resolve disputes, interpret and administer laws, with the full backings and blessings of the state. Once disputes are submitted to courts, in legal terms, parties hardly have any role to influence the course of any ruling or decision issued by a judge and it is up to the judge to dispense justice in accordance with the law regardless of any cooperation, good will, support or consent given by the parties.
ADR is another option or choice for the resolution of disputes from the court system that are established, financed, regulated and entirely sanctioned by state. The resolution of disputes through ADR is primarily initiated by the good will and consent of the parties to the dispute although sometimes, courts or other quasi-judicial or even executive bodies could play a role in referring the settlement of disputes through ADR. ADR is a consensual process that owes its existence and success on the free consent, cooperation and approval of the parties.
However, it should be very well understood that apart from individual and common consents of the parties, the legal and judicial system of each country plays no less role than the parties for the resolution of disputes by ADR. The legal system should recognize ADR as an acceptable, valid and lawful act. All settlements arising from legitimate transactions should be guaranteed prompt enforcement and review in cases of fraud or duress and similar other irregularities by the judicial authorities. The state and its institutions should help and support, take pro ADR stance, encourage citizens to use and properly regulate the conduct of institutions and persons administering ADR.
The legal Framework of ADR in Ethiopia
Resolving disputes using ADR mechanism has been practiced among the various nations and nationalities of Ethiopia for the time immemorial. Most venerated traditional institutions such as the Shimagele, in central and northern Ethiopia and the Gadaa, in the west, central eastern and southern Ethiopia have served to resolve disputes among families, clans, tribes’ nations and nationalities. Disputes regarding claims on the use or ownership of individual or communal land, water, cattle, grazing area, local custom, religious matters etc…were often resolved through these institutions. Ethiopia’s ancient religious establishments also had important roles in resolving and/or averting conflicts.
Post Italian occupation periods of Ethiopia have been marked by the introduction of modern laws and legal institutions. Even traditional and now antiquated legal institutions such as Awchacign and Afersatta obtained legal sanction and applied along with other modern conflict resolution mechanisms. It was however only after the massive codifications of Ethiopian laws toward the end of 1950s and the beginning of 1960s that serious measures were taken to adopt laws for the recognition and modernization of ADR practices.
Nevertheless, the new laws governing ADR mainly focus on contractual disputes arising from contractual relations such as sales, loan of goods, works, services and the like. Disputes pertaining to marriage, divorce and succession are also other areas of modern laws in which resolution of disputes through ADR have been provided. Under the 1957 penal code and the criminal procedure code of Ethiopia adopted in 1961, complaint crimes are the subject of ADR. These offences mainly constitute violation against private rights or interests.
Although the civil procedure code introduced the notorious anti ADR or arbitration rule under article 315 on administrative contracts or contracts with state administrative bodies, on the other hand, various legislations were also issued to promote investment and mineral exploration that permitted resolution of disputes with state administrative bodies using ADR.
The most striking legal instrument that is worthy of particular attention is Imperial order no 90/1947 for the establishment of the Addis Ababa Chamber of Commerce. This order is perhaps the oldest available law that provided for and mandated to a private chartered body to exercise institutional arbitration on “commercial and industrial disputes.” This historic legislation laid the first modern legal foundation to solve the most widespread conflict of our era-commercial disputes with the instrumentality of ADR. The most interesting aspect of this law is that it was adopted at a time when Ethiopia never had arbitration law. It appears that the absence of arbitration law was no worry to the lawmaker and presumably the legal gap for conduct of arbitration was left to customary practices.
Subsequent legislations that either amended or repealed this order upheld the same position that arbitration is the most convenient method of dispute resolution for commercial disputes as the law maker did 62 years ago. Administering ADR on commercial disputes with a specific and dedicated work unit within the chamber system is nevertheless a recent history of not more than 8 years old.
Therefore, today we have the Addis Ababa Chamber Commerce and Sectoral Associations Arbitration Institute (AACCSA AI) as an autonomous organ but part of the AACCSA, as the only legally authorized and mandated commercial disputes settlement body. Established as a pioneer disputes settlement body in January 2002, with the generous support from the Netherland Embassy in Ethiopia, this institute is unfortunately the only ADR body for commercial disputes even among the entire Chambers of Commerce and Sectoral Associations set up throughout the country.
At present, Chambers of Commerce and Sectoral Associations are legally mandated to conduct arbitration on commercial disputes when requested by disputing parties under proclamation no 341/2003. This law clearly provides such powers to chambers of commerce and sectoral Associations’ inconformity with the long and widespread practices virtually common to all legal systems the world over. Apart from institutional arbitration administered in accordance with the aforementioned proclamation however, existing civil code and civil procedure code also allow arbitration to be conducted on an ad hoc and individual basis on arbitrable disputes to which service AACCSA AI is also well-equipped with the necessary infrastructure and provisions.
Overview of Current ADR Activities in Ethiopia
Today, ADR is extensively applied and conducted to resolve disputes on matters relating to contracts, family, labour, succession, business etc… Since as noted above, ADR has deep rooted and with a firm traditional basis among the Ethiopian society, its application is not limited in a specified area of the country and the practice is common in rural as well as urban areas. By and large however, ADR in most rural and some urban areas is conducted in open air area under a tree, in church or mosque compounds and in the home of reputable elder of the community. Since most ADR in these places are conducted in traditional manners, apparently not much attention is paid to compliance with the rules of the civil code. In fact persons administering ADR are not trained with modern ADR techniques although the administrators are mostly reputable communal elders and religious leaders. Often, disputes are resolved using ADR and without any resort to courts for sanction and enforcement. It seems that social sanction of ADR is very much important for rural and some urban places of Ethiopia than the more forceful but less reputable court action.
In most urban areas, ADR is conducted in church and mosque compounds, hotels and hotel rooms, residences of ADR administrators or the residences or offices of the disputing parties are some of the venue for such activities. It has also become quite common in most court referred cases to conduct ADR at court compound, offices of advocates etc….
It is not clear how ADR may be conducted in situations where hearing and taking the testimony of experts as well as lay witnesses, for example, is necessary although one can imagine that most hotels can provide such services as they are equipped with sound recording apparatus and rooms. In most cases, it seemed that records in the conduct of ADR are taken by hand writing. The conduct of ADR on complicated commercial disputes involving thousands and millions of birr or foreign elements however, often require privacy, sound recording, transcription, related secretarial and translation services. ADR conducted on an ad hoc basis and not linked with any authorized ADR body would have to tackle this problem by employing persons that provide such services or carry out both secretarial as well as professional services all at once by themselves.
By and large, ADR activities in most urban areas are either conducted by lawyers or with the participation of lawyers and other professionals with some practical or theoretical background. Therefore in general, attempts are made to comply with the relevant prescription of national ADR laws or other rules and laws.
Current ADR Activities of AACCSA AI
AACCSA AI, as a pioneer and the only legally authorized commercial disputes ADR establishment of the business community, for the time being, not only for the metropolis but the whole of Ethiopia, provides its clients with the whole range of ADR services even by bridging the gap that our national laws left incomplete. As a result, contemporaneous with its establishment, the AACCSA board of directors enacted the first arbitration rules that supplement the national arbitration rules as provided under our civil code and civil procedure code. The AACCSA arbitration rule is consistent with the mandatory provisions of the national codes and enormous attempts were made to adopt similar rules applicable in most reputable commercial arbitration institutions as well as relevant model arbitration rules of the UNICITRAL.
In order to meet the needs of the business community as well as other members of the society that may be or are dragged in to commercial disputes, the AACCSA board of directors has also adopted Mediation, Conciliation and Adjudication rules. This year, the seven years old arbitration rule has been thoroughly amended and AACCSA’s Revised Arbitration Rule has come in to force since last November 2008.
Moreover, last June 2009, AACCSA board of directors approved the procedural rules of AACCSA AI to ensure its practical and legal independence from all other activities of the Chamber, with the ultimate objective of heightening the status and promoting the Institute as an important commercial disputes resolution center in the continental region. This rule provided among others, a council comprising members from the business community, the academics and the various professions with the required knowledge and integrity in the area of ADR to meet the expectations of customers and AACCSA’s unwavering commitment to provide high quality service.
The AACCSA AI currently serves as arbitrator, adjudicator, mediator and conciliator appointing body when requested by parties or as provided in the countless commercial contracts. The institute also administers institutional ADR as provided in existing commercial contracts or in accordance with an arbitral submission. The institute is also equipped with excellent and sound proof room to meet the legal standard for the privacy and confidentiality of all ADR proceedings with all necessary equipment. Excellent sound recording, transcription, translation facilities and the whole range of secretarial services are available both for institutional as well as ad hoc ADR services. All correspondences and documentation of parties as well as administrators of any ADR services are carefully kept and secured in accordance with the numerous ADR rules and principles.
The AACCSA AI charges reasonable fees and administrative expenses for all of its services in accordance with the fee schedules adopted by the AACCSA board of directors that are attached with all rules for public knowledge and as a matter of transparency. It is important to note here that although the AACCSA is a non-for-profit, non-governmental private chartered body established under a special legislation, it is legally authorized to charge its customers for its service to recover its costs as provided under its establishment proclamation.
Since it is a legal obligation under the relevant revenue laws of the country, AACCSA issue a legal receipt recognized by the revenue and customs authority for all fees, charges and expenses it collects. On the other hand, it also discharges its reciprocal obligation to report for and transfer to the concerned tax authority all taxes it collects on behalf of the authority. Therefore, unlike ADR services administered by legally un-mandated or unauthorized organs as well as individuals, AACCSA customers not only receive proper and legitimate service for their hard won money but their expenses and costs for the services provided by the Arbitration Institute are deductible by tax authorities.
Finally AACCSA and its arbitration organ is a private chartered body with a perpetual existence and it provides for its customers all of its services with this lofty purpose and forward looking objective and not for short term gain or self serving cheap popularity. There is nothing more terrifying and scaring than to see a clause in most commercial contracts of the metropolis designating our Chamber or its Arbitration Institute as an appointing body of arbitrators, mediators etc… and as an organ to resolve any commercial disputes using any one of the ADR through institutional or ad hoc mechanisms .Therefore we always give extra care and attention in handling the interests of our customers.
The importance of networking among ADR bodies
As the Ethiopian saying goes “One cannot clap with a single hand.” Therefore, in order for a person to clap he needs to have two hands. This saying has as much validity as with the purpose of networking among ADR institutions. The past and existing Ethiopian system is very much conservative on mandating private bodies to engage on institutional ADR. As a result, there are very few legally authorized bodies that can provide such services to the vast population of the country. Lack of capacity and absence of adequate training on ADR have also been a stumbling block to reach out large section of the society to provide institutional as well as ad hoc ADR services. These problems can be tackled to a larger extent by networking. By creating networking local ADR institutions can mobilize their resources to optimally use it and achieve their ultimate objectives.
The All rounded Development & Capacity building Association has been remarkably working over the past few years in training several professionals representing various governmental and nongovernmental institutions. The efforts of this association is worthy of appreciation particularly on its endeavors to organize timely and valuable theoretical and practical trainings on ADR in collaboration with Center for Africa Peace and Conflict Resolution, California State University Sacramento USA. This training has so far contributed in producing large group of persons that can pro- actively advocate and work on ADR. A forum comprising these entire trainees and a strong institutional networking will have a positive and enduring result that will have national importance.