Last week, I had written a post about the discourse regarding reforms in India and the nature of reforms India actually needs. A major category of reforms; often talked about; is reforms regarding the justice delivery system in India. Somehow, the discussion on reforms in India has always arisen in an economic context; reforms were steps taken to increase India’s GDP growth rate by either liberalizing foreign trade , allowing more competition and more free markets domestically and/or promoting exports. These reforms have benefited people in their roles as consumers, entrepreneurs, employees- in other words, as participants in an economic system. But people also play another integral role – that of a citizen.  Reforms to facilitate this role have been few and far between.

The system of justice delivery in a country affects both roles played by an individual – that of a consumer and a citizen. A fair and timely justice system increases the freedom available to an individual, reduces vulnerability to anti-social and secessionist movements, builds up trust in a society and keeps citizens free from the excesses of the legislative and the executive. On the economic front, a good justice system helps enforcement of contracts and reduces uncertainty, thereby reducing transaction costs and cost of capital. The need for a sound justice system therefore, is well established.

Quite amazingly, even the nature of reforms required has been discussed to death. In fact, the first commission report on pendancy and delays in courts in India was the Lord Rankine report in 1924! What is lacking is perhaps political will and a bottom-up demand from the people to do so. ( In case, anyone wants to read more, Bibek Debroy has written a series of extremely well-articulated papers on judicial reforms in India which are fairly exhaustive and freely available on the net). Therefore, there is little new to be added about the kind and nature of reforms required. However, a targeted methodology to implement these reforms is missing. I intend to possibly suggest an action-plan for judicial reforms in India.

There are a few key strands in judicial reforms which give an indication about the methodology that needs to be adopted. These can be briefly summarized as:

1. “Statutory reforms”: These include reforms regarding statutes or the laws themselves – removing obsolete and antique laws, harmonizing and unifying statutes by removing multiplicity across center and state laws which serve the same purpose and removing state intervention with the state deciding to not implement statutes which serve no contemporary purpose.
2. “Administrative law reforms”: Indians are not governed only by laws framed by parliaments or courts; they are also governed by a whole maze of rules, regulations, guidelines, notifications, circulars, press notes and gazettes (I am sure this is not an exhaustive list!) published by the various state and center departments and ministries. These are much more arbitrary and confusing than laws and have often been written with a mind to facilitate bribery and rent seeking. A comprehensive review of these administrative laws is critical.
3. “Judicial reforms”: These are reforms to increase the efficiency and productivity of the justice delivery system, reduce delays and pendancy in courts (pendancy being defined as the number of cases pending before a court) and remove corruption in the lower courts.

These are the three broad categories of reforms required to which everybody agrees. But as I said, the implementation roadmap is unclear; primarily because of a lack of political will and also due to the sheer magnitude of the task. There are reportedly 1,100 central statutes and between 25,000 – 30,000 state statutes (and there is no comprehensive database containing all)! The task therefore, is not simple, by any means. The following is my roadmap to address the issue:

1. Statutory reform will naturally take time; therefore, this requires a comprehensive review (the existing law commissions could take it up) with a reviewing authority given a 3-5 year mandate to do the job.
2. Administrative reforms will also take time, though they have their own complications; primarily, reforms here could mean infringing upon the bread and butter of the bureaucracy and ministries through bribery. This therefore, would have to tied in with broader administrative reforms. Also, given the UPA’s governments propensity for 100 day plans, each ministry could be asked to at least form a detailed database of all its rules, regulations etc. in an electronic form within 100 days.
3. Judicial reforms – These are the most interesting one and do not suffer from the same complexities as the other two. The task is simple – the existing backlog of cases needs to be resolved and the time to settlement of new cases shortened. A project management style ABC analysis can yield interesting insights (Data: Bibek Debroy, again):

 i) 50 – 60% of the cases (civil) involve the government as a litigant; often both litigants are government departments

ii) 4 high courts (Allahabad, Kolkata, Mumbai and Chennai) account for 50 – 60% of the pending backlog of civil cases

Therefore, if one imagines a demand and supply curve for justice (with quantity being cases resolved and price? Well, it could be the cost of getting justice- lawyer fees, mental stress etc.); one way could be measures to increase the supply curve to the right.

Supply side measures: These are more conventional measures: increase in the number of judges (could take time considering quality is critical), faster resolution by allowing lesser appeals (trade-off between efficiency and right to a fair trial), automating processes, reducing the number of holidays (courts in India follow a leisurely British practice of summer vacations!) etc. Some of these practices are being reformed; and the cases resolved each year as a percentage of cases introduced per year has increased to 80-90% as opposed to 50-60% a decade ago (This ratio has to go above 100% to reduce backlog)

Demand side measures: Another way to reduce the cost of justice is to move the demand curve to the left. (Well, this will reduce quantity; but is desirable because we are reducing quantity by reducing the number of cases filed each year) Measures include:

• Moving all cases where both litigants are the government to an arbitration authority (can be done within a year)
• Shifting small cases to the lok adalats; an out-of-court redressal mechanism
• Reducing the number of appeals allowed to the government (90% of government appeals eventually fail)
• Strengthening arbitration and mediation mechanisms; particularly for contract act cases,which can be resolved by an arbitration authority)

These measures, I believe can be carried out within 2-3 years. A serious application of mind towards judicial reforms will be a good legacy that the UPA government can leave for this country.

Another issue, though not directly related is worth mentioning (Would love to have some law students comment on this). I come across so many recently graduated lawyers who tell me most good law students from the best institutions wish to do corporate law (in big law firms) and shy away from litigation and court-room practice. I would like to know the reasons for this (apart from money, of course) because it is critical to have the best lawyers in the court-rooms if one wishes to have any serious reforms.

P.S: I am told this would probably be the 100th post on this platform. I would like to congratulate Shubham, Siddhesh and the rest of the gang for coming up with this idea which I think has great potential. Thanks to all readers who have taken great pains to read long articles and provide extremely enlightening comments.

(I’ll continue this series on reforms by talking about financial sector and administrative reforms, though will probably digress for one article. My next article, I think will be on disguised unemployment, information asymmetries and incentive problems in investment banking)

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