CS Professional June 2025 Question Paper Arbitration, Mediation and Conciliation

FOR CS PROFESSIONAL EXAM PREPARATION

CS Professional 2025
Question Paper ·
Arbitration, Mediation
and Conciliation
EXAM YEAR TYPE

CS Professional 2025 Question Paper
SUBJECT DATE

Arbitration, Mediation and Conciliation June 2025

Notes · Sample Papers · Previous Year Papers · Mock Tests

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NEW SYLLABUS
551
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OPEN BOOK EXAMINATION
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Time allowed : 3 hours Maximum marks : 100

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l of questions : 6 a
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Total number Total number of printed pages : 15

NOTE : Answer ALL Questions.

PART–I

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m solutions company, to develop and maintain a
1. NexaSoft Private Ltd., an Indian IT services provider, entered into a five-year contract with

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TechknoTech Inc., a U.S.-based software
g (ERP) system. The contract outlined key provisions,
cloud-based enterprise resourceaplanning

including project milestones, payment schedules, performance benchmarks, data security measures,

intellectual property rights, liability limitations, and dispute resolution. The arbitration clause

specified that any disputes would be resolved through arbitration.

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As the project progressed, disagreements emerged regarding timelines, scope changes, and

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ag to potential regulatory risks. TechknoTech further claimed that NexaSoft's delays led to business

losses and customer dissatisfaction, which ultimately compromised its market position. NexaSoft,

in contrast, argued that TechknoTech had frequently rnodified the project requirements without

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formal amendments, resulting in delays and additional costs. NexaSoft also claimed that

TechknoTech had defaulted on payment obligations, leaving several invoices unpaid for completed

work.

Due to these disputes, TechknoTech terminated the contract, refused to clear pending invoices,

and sought damages for losses incurred. NexaSoft, contesting the validity of the termination,

invoked the arbitration clause to resolve the matter. However, a dispute arose regarding the

arbitration mechanism. NexaSoft preferred ad hoc arbitration, emphasizing cost efficiency and

procedural flexibility, while TechknoTech insisted on institutional arbitration, arguing that a structured

process was necessary for a cross-border technology dispute.

A sole arbitrator was eventually appointed under institutional arbitration rules. During the arbitration

proceedings, NexaSoft objected to the admissibility of TechknoTech's damage claims, stating

that they were filed beyond the contract's limitation period and that TechknoTech had implicitly

waived its right to claim damages by continuing the project despite alleged deficiencies.

TechknoTech countered that the damages were a direct result of NexaSoft’s breach and

that the contract did not restrict compensation for consequential losses. Additionally, TechknoTech

raised concerns about NexaSoft's handling of sensitive data, alleging that the security flaws

in the software had potentially exposed confidential information to third parties. NexaSoft

denied the allegations, asserting that no actual data breach had occurred, making TechknoTech’s

claim speculative and unsubstantiated.

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After several hearings and an assessment of expert reports, the arbitrator ruled partially in

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favor of TechknoTech, granting compensation for delays and performance deficiencies but

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rejecting claims related to business losses and data security failures, citing insufficient evidence
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and speculative calculations. Dissatisfied with the ruling, NexaSoft challenged the arbitral award

in an Indian court under Section 34 of the Arbitration and Conciliation Act, 1996, arguing

that the arbitrator had exceeded jurisdiction by admitting time-barred claims, misinterpreted

key contract provisions, and issued an award contrary to Indian public policy by imposing

damages beyond contractual terms. The court was now tasked with balancing the principles

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of judicial intervention and arbitral finality.

With reference to above facts, answerethem following :
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(a) ag that should be included in a contract, to prevent disputes.
Outline the critical clauses

(b) Explain the difference between ad hoc and institutional arbitration.

(c) Discuss the grounds for challenging an arbitral award under Indian law and the factors

influencing the court's decision to set it aside.

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(d) ‘In arbitration, an arbitrator is the presiding officer.’ Comment in the background of

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the norms which an arbitrator should abide by.
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ag (e) Elucidate the general guidelines which an arbitrator should follow for drafting an Arbitral

award.

(5 marks each)

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2. (a) Rohan, a contractor, entered into an agreement with Zenith Constructions Ltd to complete

a commercial building project within a stipulated period. The contract contained a

clause stating that in case of a breach, Rohan would be liable to pay a fixed sum

of ` 10 lakh as compensation. Due to unforeseen delays, the project was not completed

on time, and Zenith Constructions Ltd invoked the penalty clause, demanding the entire

amount. Rohan contended that the actual loss suffered must be proved before such

compensation could be enforced.

In the light of legal provisions, discuss whether Rohan's contention is valid.

(b) Alpha Constructions Ltd and Beta Infra Private Ltd entered into a Joint Venture

Agreement (JVA) for the development of a commercial project. The agreement contained

a termination clause allowing either party to terminate in case of a material breach

if the defaulting party failed to rectify the breach within 30 days of receiving notice.

Due to non-compliance with key project deadlines and financial mismanagement, Alpha

Constructions Ltd issued a termination notice. Beta Infra, disputing the termination,

filed a petition under Section 9 of the Arbitration and Conciliation Act, l996, seeking

an injunction against the termination and restoration of the agreement. Alpha Constructions

Ltd argued that since the contract was determinable in nature, the court could not

grant such relief.

With reference to a case law, comment whether Alpha Constructions Ltd will succeed.

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(c) Aeon Technologies Ltd, an Indian company, entered into a contract with Orion Machines

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Inc., a South Korean firm, for the supply of industrial equipment. The agreement
an arbitration clause stating that disputes would be resolved through arbitration,m
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m not explicitly mention the seat of arbitration or the governing law. A dispute s e
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a while Orion Machines Inc. claimed that Singaporean law should apply based on the
arbitration venue.

Based on a case law, examine how the seat of arbitration and the governing law
should be determined.

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3. (a) NTP Ltd. (NTP) and SPM Infra Ltd. (SPM) entered into a contract for certain
project works (Agreement). lIn terms of the Agreement, SPM furnished a performance
ag bank guarantee for a cumulative amount of INR
bank guarantee and advanced
14,96,89,136 to secure the NTP. Upon the successful completion of the project, NTP
issued a certificate of completion. NTP subsequently communicated to SPM by way
of a letter dated 10 April 2019 that the final payment would be released once SPM
issued a no-demand certificate.
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On l2 April 2019, SPM issued the required no-demand certificate, prompting NTP

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to release the final payment of INR 1,40,00,000 in April 2019. However, the bank

las guarantees were not released at that time due to ongoing
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ag liabilities between the parties relating to other projects at Bongaigon, Barh, and Korba.
NTP formally notified SPM of this decision on l4 May 2019. In response, SPM
raised objections, claiming a sum of INR 72,01,53,899 as recoverable liabilities from
NTP for actions attributable to NTP.

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In an effort to address the unresolved disputes arising from the Agreement, SPM
wrote to NTP on 12 June 2019, requesting the appointment of an adjudicator as
prescribed by the Agreement’s dispute resolution mechanism. NTP did not take any
action in response to this request from SPM. As NTP took no action, SPM moved
to Delhi High Court by filing a writ petition under Article 226 of the Constitution.
The Delhi High Court, through an interim order dated 8 July 2019, directed NTP
not to invoke the bank guarantees and instructed SPM to maintain the guarantees
in force. While the writ petition was still pending, the parties managed to settle their
disputes and executed a Settlement Agreement (Settlement Agreement). As per the
Settlement Agreement, NTP released the bank guarantees on 30 June 2020, and SPM
withdrew the writ petition.

However, three weeks after the bank guarantees were released and two months after
the Settlement Agreement was executed, SPM issued a letter of repudiation. SPM
claimed that they had been subject to coercion and economic duress during the execution
of the Settlement Agreement. Subsequently, SPM repudiated the Settlement Agreement
and filed an application under Section 11(6) of the Arbitration and Conciliation Act,
1996, with the Delhi High Court on l0 October 2020. In this application, SPM also
asserted that NTP had not appointed an arbitrator despite multiple requests, which

necessitated SPM’s recourse to the High Court.

In the background of the above matter and in view of judicial pronouncement, discuss
primary inquiry about the existence and the validity of an arbitration agreement.

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(b) Zenda Infrastructure Ltd acquired land for a national highway project, compensating

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landowners based on government-determined rates. Dissatisfied with the valuation, the

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landowners initiated arbitration, but the appointed arbitrator upheld the original
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compensation. Seeking redress, the landowners approached the District Court,

Infrastructure Ltd challenged this decision, arguing that courts lack authority to modify

arbitral awards under the applicable arbitration law.

In the context of a judicial precedent, evaluate whether Zenda Infrastructure will succeed.

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emengaged in a contractual dispute with AeroFleet
Skyline Aviation Private Ltd swas
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a in arbitration proceedings. However, its counterclaims
Services Ltd and participated

were struck off by the Arbitral Tribunal due to a significant delay in filing. After

exhausting various legal remedies, Skyline Aviation filed a petition under Section 11

of the Arbitration and Conciliation Act, 1996, seeking to refer its counterclaims to

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arbitration before the same Tribunal, citing its familiarity with the case. AeroFleet Services

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opposed this, arguing that the claims were barred due to prior dismissal and the

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doctrine of res judicata.

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In the context of arbitration law and legal precedents, examine whether the arguments

of AeroFleet Services are justified.

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Attempt all parts of either Q. No. 4 or Q. No. 4A

4. (a) Mr. AR, a retail investor wants to lodge a formal complaint with the Stock Exchange

against M/s ABC Ltd. Mr. AR alleges that the company M/s ABC Ltd. did not

release his unpaid dividends in spite of his repeated request. As a practising Company

secretary, prepare a note for your client Mr. AR indicating the framework for handling

of complaints available through SEBI.

(b) Mr. A, an Investor lodged a Complaint against NSDL, regarding less number of

securities shown in his account. But NSDL did not respond. Thereafter, the complaint

was filed on SCORES portal. NSDL provided the resolution through SCORES portal

but Mr. A is not satisfied with the resolution.

Now, Mr. A wants to initiate resolution through ODR portal. Discuss the benefits

available for initiation of the dispute resolution process through ODR.

(c) Alpana Tech Private Ltd and Swalpana Solutions Private Ltd, both companies

incorporated in India, entered into a contractual agreement that included an arbitration

clause. A dispute arose and Alpana Tech sought to classify the arbitration as an

International Commercial Arbitration under the Arbitration and Conciliation Act, 1996,

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citing foreign investment in its parent company and business operations outside India.

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Swalpana Solutions, however, argued that since both parties were Indian-registered

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entities, the arbitration must be treated as domestic arbitration.
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Tech will succeed.

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OR (Alternate Question to Q. No. 4)

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Sterling Minerals Ltd entered s ema contract with Nem Infrastructure Private Ltd for
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4A. (i) into

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excavation work at a predetermined fixed rate, explicitly excluding any cost escalations.

Due to unforeseen market changes, Nem Infrastructure sought additional compensation,

which Sterling Minerals refused, citing the strict contractual terms. The dispute was

referred to arbitration, where the arbitrator awarded additional payments beyond the

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agreed rate. Sterling Minerals challenged the award, arguing that the arbitrator had

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exceeded jurisdiction by disregarding the contractual provisions.

s g lathe contention of Sterling
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With reference to a judicial precedent, comment whether

Minerals is justified.

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(ii) Onko Metals Inc., a foreign supplier, entered into a contract with Premo Copper
Ltd., an Indian company, for the supply of raw materials. The contract incorporated
a multi-tier dispute resolution clause, stipulating that any disputes would first be arbitrated
in India, with a provision for further arbitration in Singapore if necessary. Initially,
the business relationship between the parties was smooth, and contractual obligations
were being fulfilled without issues. However, disputes arose later regarding alleged
breaches of contractual terms, leading to arbitration proceedings. The first arbitration,
seated in India, ruled in favor of Premo Copper. Dissatisfied with the outcome, Onko
Metals invoked the second arbitration in Singapore, as permitted under the contract,
which resulted in an award in its favor. Premo Copper challenged the enforceability
of the second arbitral award in India, arguing that the dual arbitration mechanism is
legally unsustainable. It contended that allowing multiple arbitration proceedings over
the same dispute undermines finality in arbitral awards and creates legal uncertainty.

Additionally, Premo Copper asserted that conflicting arbitral awards could lead to
enforcement challenges and inconsistencies in international commercial arbitration.

Analyse the validity and enforceability of multi-tier arbitration clauses in context of
a settled case law.

(iii) Div Studios Ltd entered into an agreement with Astra Broadcasting, a government-
owned media network, to produce a reality show. Despite initial approval, Astra
Broadcasting later refused to air the show, leading Div Studios to initiate arbitration.

During the arbitration proceedings, Div Studios sought to amend its statement of claims

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to include additional financial losses incurred due to pre-production expenses such as

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research, scripting, and hiring production staff. The arbitrator rejected the application,

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ruling that the amendments constituted new claims barred by limitation. Div Studios
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mere clarifications rather than fresh claims.

With reference to judicial precedent, comment whether Div Studios will succeed ?

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PART–II
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5. Mr. Salman and Ms. Ria, who met via mutual marriage broker namely Mr. Nikah. Families

of both Mr. Salman and Ms. Ria were preparing for their upcoming wedding, the invitation

cards were printed, dates were decided, hotels were paid advance money and what not,

everything seemed to be going smoothly until disagreements arose over the financial responsibilities

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for the wedding festivities, specifically for the ring ceremony and the main wedding event.

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considering finding another match for their daughter. This threat of breaking

g a emotionally draining breakup.
a escalated the conflict, leading both parties towards a costly and

Not only would they have to invest more resources in finding new matches, but all the

preparations made for the wedding would go to waste.

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Thereupon, Mr. Nikah was being asked by both the parties to find someone new for them

since they had a truce with their previous match. At this, Mr. Nikah introduced Mr. X,

an expert in mediation and conciliation matters with both the parties to arrive at some settlement.

Mr. X acted as a neutral third party; brings both sides together for a facilitated discussion.

Initially, ego and unresolved grievances hinder progress, and the impasse remains unchanged.

However, Mr. X didn’t give up. Recognizing the need for separate conversations to uncover

underlying concerns, one day Mr. X meets with Salman’s family privately and a day after

with Ria’s family.

With a deeper understanding of each side’s perspective, Mr. X requests both the families

to meet again and have a constructive dialogue. After hours of discussion, facilitated by

Mr. X insights and interventions, a breakthrough occurs. Both families agree on a compromise :

the bride’s family will cover the expenses of the ring ceremony, while the groom's family

will handle the main wedding function.

In the background of the above, answer the following :

(a) Discuss the important advantages of mediation in arriving at a compromise between

the parties.

(b) When a court can disqualify a mediator ?

(c) Before sitting with the parties, Mr. X was required to do his homework. What should

be the procedure of mediation of Mr. X ?

(5 marks each)

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Attempt all parts of either Q. No. 6. or Q. No. 6.A.

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6.
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ebillion, which was one of the largest deals in the retail industry. The negotiation
Amaze Ltd. announced its acquisition of W. Foods Market Ltd., a high-end grocery chain,
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for $13.7
a Amaze Ltd. and W. Foods Market Ltd is a well-known case, which has been
between

analysed by various sources. One of the primary issues in the negotiation was the price

at which W. Foods Market Ltd was willing to sell. Initially, Amaze Ltd. offered $41 per

share, but W. Foods Market Ltd rejected the offer as it was considered too low. However,

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negotiations continued until Amaze Ltd. increased its offer to $42 per share, which W. Foods

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Market Ltd ultimately accepted.

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Another issue in the negotiation was the integration of Amaze Ltd.’s online retail and distribution

platform with W. Foods’ brick-and-mortar stores. Amaze Ltd. wanted to use W. Foods’

physical locations as distribution centers for its online grocery business. However, W. Foods

Market Ltd was concerned about maintaining its unique brand identity and customer experience.

To address this issue, Amaze Ltd. agreed to allow W. Foods Market Ltd to continue operating

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as a separate brand, with its own management team, purchasing practices, and quality standards.

c. o There were also concerns about the impact of the acquisition onseW.m Foods’ employees,
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efficiency
a labour. To address these concerns, Amaze Ltd. committed to maintaining W. Foods’ employee

benefits and job levels and pledged to continue supporting local suppliers and farmers. Additionally,

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Amaze Ltd. announced plans to introduce new technology to improve operational efficiency,
which would create new job opportunities for W. Foods Market Ltd employees.

Overall, the negotiation between Amaze Ltd. and W. Foods Market Ltd was complex and
multifaceted, involving issues related to price, branding, and employee concerns. By reaching
a successful agreement, Amaze Ltd. and W. Foods Market Ltd were able to position themselves
as key players in the evolving grocery market, while also addressing the concerns of stake-
holders and employees.

In the background of the case, answer the following :

(a) What are the elements of the negotiation process ?

(b) What are the steps during the negotiation process ?

(c) What are the negotiation techniques and styles for negotiation practitioners ?

(5 marks each)

Or (Alternate Question to Q. No. 6)

6A. (i) Plethora Private Ltd and Count Enterprises are embroiled in a contractual dispute
and have chosen mediation as their resolution method. If the parties reach a mutual
agreement, the mediator will document the terms in a settlement that is confidential,
binding, and enforceable. However, if no consensus is achieved, the parties can either
accept the mediator’s recommendation - which will become binding unless explicitly
declined within a predetermined period or opt for a final decision that is immediately

enforceable.

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As a legal advisor, evaluate these two scenarios and explain the processes by which

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the mediator ensures that the resolution is enforceable.

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(ii) gl ‘‘The feature of remaining secret makes the ‘mediation’ different from courtalitigation
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procedure as well as different from other modes of alternate dispute resolution

mechanism.’’ Discuss the importance of confidentiality in mediation and examine

exceptions, if any.

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(iii) ‘Cross-cultural mediation can be very difficult for some practitioners and alternately

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be very beneficial to others.’ Comment

negotiations.

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