Online Dispute Resolution: Feasibility in The Post Pandemic India
India, among other countries, is facing a colossal economic slowdown due to the Covid-19 Pandemic induced lockdown. With various industries and professions facing hardships, legal profession and the justice delivery system have also suffered a great deal in this global crisis. In India, the dispute resolution process and the administration of justice is infamous for getting delayed and the pandemic has worsened the situation. Although various reforms have been put in place in the past few years to improve the efficiency and reduce the burdens of the courts, the outcome has not been as anticipated, as presently there are 33.89 Million pending cases before the District Courts and 4.49 Million pending cases before the High Courts across the country[ii].
While the Hon’ble Supreme Court has resolved to allow e-filing and virtual hearing of cases, the burden of the courts is likely to increase post the pandemic as the disruption caused by it, including employment issues, hardships faced by suppliers, failure in complying with contractual obligations and potential liquidity distress, etc., has given rise to a flood of new disputes. Thus, even though the judiciary has embraced the social distancing measures, it is compelled to adapt forthwith the modern and advanced means of functioning and ensuring access to justice.
With the advent of technology in aiding the means of dispute resolution, Online Dispute Resolution (ODR) or e-ADR has exhibited the most promising solutions of resolving disputes which not only respect the implemented norms of social distancing but also facilitate the requisite flexibility. Moreover, the Arbitration practice has smoothly adapted to function with technology over the last decade. However, the conundrum around ODR is whether it can be the future of Dispute Resolution? The present article attempts to contemplate the expediency of Online Dispute Resolution in the post-COVID India.
Online Dispute Resolution
ADR emerged as an ingenious solution to lessen the burden of the courts, and its digitalization laid the foundation of ODR. In simple terms, Online Dispute Resolution is an extended arrangement of ADR where modus operandi to resolve disputes takes place over the internet. The ODR Working Group of UNCITRAL defines online dispute resolution as ‘a mechanism for resolving disputes facilitated through the use of electronic communications and other information and communication technology’.[iii] During a virtual meeting on online dispute resolution hosted by NITI Aayog in collaboration with Omidyar Network India, it was affirmed that
“ODR is the resolution of disputes, particularly small- and medium-value cases, using digital technology and techniques of alternate dispute resolution (ADR), such as negotiation, mediation, and arbitration. While courts are becoming digitized through the efforts of the judiciary, more effective, scalable, and collaborative mechanisms of containment and resolution are urgently needed. ODR can help resolve disputes efficiently and affordably.”[iv]
Where e-filings and virtual hearings for litigation are conforming measures on account of the pandemic, technology has always incentivized the various ADR mechanisms including online dispute resolution. Although currently no separate legal framework regulates Online Dispute Resolution, the judiciary has welcomed a combined application of the current legislations accommodating the digitalised aspects of ‘e-ADR’. The Supreme Court of India has acknowledged the legitimacy of an online arbitration so long as it complies with Section 4 and 5 of the Information Technology Act, 2008 read with Section 65B of the Indian Evidence Act, 1872 along with the provisions of the Arbitration and Conciliation Act, 1996.[v] Further, it is also permissible to affix digital signatures of the parties.[vi] Thus, ODR has staged prominently more advantageous features than a typical offline ADR did.
Prospects and Challenges of Online Dispute Resolution
Although ODR offers a sophisticated setup with various advantages to the parties, the stakes involved in the dispute may be a key factor in deciding its applicability. For instance, in matrimonial or family disputes, the sensitivity attached may require a robust involvement of the arbitrators or mediators for necessitating cooperation between the parties which may be obstructed by the digital barriers. Similarly, an ODR may not be an ideal course in a complex commercial dispute involving multiple claims by numerous parties and bulky evidence which mandates sophisticated case management. Despite such skepticism, the true potential of
ODR lies in its many advantages such as:
ODR does not require the physical presence of the parties, litigants, arbitrators or mediators as the Arbitration and Conciliation Act, 1996 allows the arbitral tribunals to adjudicate the disputes solely on the basis of written submissions, documents, and pleadings[vii] which can be served electronically[viii], and if the parties request for an oral hearing, the same can be conducted remotely through virtual meeting platforms over the internet. Therefore, ODR substantially obviates the traveling expenses.
The virtual participation of the parties in an ODR slashes the infrastructure cost for conducting the Arbitration or Mediation as the parties only incur the cost of technology required to hold the meetings.
Much like in a traditional ADR, ODR also offers party autonomy, however, additionally, it extends greater control and flexibility over the timelines to efficiently resolve the disputes. Moreover, ODR services can typically function twenty-four hours a day unlike traditional litigation or an in-person ADR, which eases the conduct of international Arbitrations.
ODR provides asynchronous communication, which means that parties are not bound to communicate in real-time as they can record their responses through electronic means and communicate the same at their convenience. This also offers the space required to the parties for considering a settlement or other such alternatives.
The Cloud-based networks have made the paper and case management effortless as all the documentation is stored on a secured cloud network and is accessible by parties from anywhere.
Whilst there are huge benefits of ODR, one cannot overlook the practical challenges it envelopes. The technological innovation prevails to transform the approach towards dispute resolution, but the critical question that persists is whether the legal fraternity is prepared for such a transformation? The Indian legal society is peculiarly occupied by diverse generations of lawyers. So, the first and foremost drawback of implementing ODR widely is that not every generation or class of lawyers in India is adept to modern technology. Where an ODR requires technical know-how regarding laptops, video conferencing applications, cloud systems and networking, if the stakeholders of the dispute and their attorneys are not tech-savvy, the whole experience can get erratic. Like the Hon’ble Justice Dr. D.Y. Chandrachud stated in a virtual meeting on ODR[ix],
“The question today is how well can we adopt technology to enhance access to justice and strengthen rule of law. Technology can be disruptive and there is a technological divide in India.”
Further, the second-most unique and vital challenge in organising an ODR is the lack of privacy and cybersecurity. The exchange of sensitive data can be interrupted, hacked, or released publicly without due authorization if the network is not secured by adequate encryptions. This issue critically sows a lack of trust between the parties as well, which in essence is a determinant to embrace ODR. Another criterion to consider while opting for an ODR is the essence of the human element in the process of resolving disputes. Many acclaimed lawyers profess that verbal cues, tones, volumes, body language and real-time emotional reflexes during the hearings, especially during a cross-examination play a significant role in changing the course of litigation. Whereas ODR, which is an arrangement of impersonal nature, provides no room for such human embodiments. Likewise, another disadvantage which ODR encompasses is its hostility towards on the spot communication between the clients and their attorneys, as during a hearing, clients may simultaneously like to pitch in their inputs or instructions to their counsels or a counsel may require prompt instructions by his client, for which the required privacy is not offered by most of the video conferencing platforms.
Additionally, in a developing nation like India, there remains a lack of trust in technology as a consequence of its inadequate reach among citizens. Therefore, it falls upon the lawyers and parties to consider this advanced method of resolving disputes on case to case basis. Moreover, it is essential for attorneys to educate their clients about the benefits and constraints of an ODR process and obtain explicit consent before opting for it.
How viable is the implementation of “Virtual” Dispute Resolution?
As stated earlier, the key component for the success of ODR or virtual litigation is technology. India is one of the most active domains of internet users and in the past few years the telecom market has witnessed a severe reduction in market price of basic internet subscriptions by virtue of competitive economic conditions. However, currently India still has only a 50% rate of internet penetration.[x] During this pandemic, almost all the educational institutions resorted to online classes but owing to lack of administrative support and governmental intervention, the students in rural areas are struggling. There are still many households in this country which can only dream to buy a computer, much less a smart phone. Thus, in a society which is grappling to afford as basic a necessity as education in these desperate times, how viable is it to widely implement a digitalised model of resolving disputes?
The solution can be reflected in something as strategic as a dedicated comprehensive legal framework for online resolution of disputes. For enforcing an efficacious and affordable structure of accessing justice through internet, a regulatory framework can play a major role. Although the adoption of UNCITRAL Model Laws on Arbitration have accommodated ODR in practice, a centralised regulation on ODR will address the practical challenges vis-à-vis harmonization with local laws. A strategic framework to regulate the online resolution of disputes can not only improve the internet penetration across the country to facilitate its process, but also make it possible to devise progressive ideas such as establishment of dedicated ODR Centres, regulated fee structures for ODR, financial aid to paupers, training centres for advocates as well as the judges, dedicated privacy and cyber security cells, etc. Eventually such a framework can build the trust and encourage the public to recourse to this advanced way of resolving disputes.
The development of ODR in India has been progressive owing to increasing international commercial arbitrations. On account of rising popularity of Ad hoc Arbitration, many private players and start-ups have established innovative platforms explicitly designed to cater the requirements of an online dispute resolution process. Some of such organisations include Centre for Online Resolution of Disputes (CORD) which provides end to end administration of the cases, SAMA which caters to online resolution of variety of disputes, Centre for Alternative Dispute Resolution Excellence (CADRe) which has an online ecosystem for Arbitration, AGAMI which has aimed to resolve 1 million disputes via ODR by January 2022, Indian Dispute Resolution Centre (IDRC) - India’s first of its kind institutional ADR Centre established by Indian Dispute Resolution Council which offers both offline and online dispute resolution services. Thus, it is fair to comprehend that even in the post-pandemic scenario, with a systematic legal framework and the support of both government and the private players, ODR can be the most successful device of quickly and efficiently resolving disputes in India.
Conclusion and Way Forward
Certainly, the pandemic induced lockdown has radically reformed the manner of resolving disputes by spurring the usage of technology. However, in a developing nation like India where only half the population uses internet, introducing ODR as a justice delivery system of the future will not be a plain sailing. It was predicted by Gordon Moore, the cofounder of Intel that the processing power of silicon chips (a primary component in the computers) doubles every eighteen months,[xi] and on the contrary, the ability of a human to adapt to such advancement keeps consistent or is slower. Hence, to cope up with this tech-environment and to embark upon the willingness of the people to trust in the modern course of dispute resolution, it is crucial for the executive, judiciary, and the legislature to take the frontline. Undeniably ODR is the way forward in today’s tech and AI-advanced world, besides it offers the best solution to lower the courts’ burden and meets the social distancing norms. In all its likelihood, the private sector will be tapping on the newer technologies sooner than the executive and the administration. Therefore, to prosperously make ODR the future of resolving disputes, it is exigent for the institutions at play to come together with an expeditious strategy and realise the possibilities which are attainable by the online resolution of disputes.
[i] Aviral Jain is a law graduate of 2020 from NMIMS' Kirit P Mehta School of Law. He is keenly interested in commercial litigation and Arbitration practice and is currently looking for opportunities in the respective fields. For any discussion related to the article, he can be contacted through firstname.lastname@example.org [ii] Home - eCourt India Services, Ecourts.gov.in, https://ecourts.gov.in/ecourts_home/ (last visited Aug 20, 2020). [iii] UNCITRAL Technical Notes on Online Dispute Resolution (United Nations, 2017), https://www.uncitral.org/pdf/english/texts/odr/V1700382_English_Technical_Notes_on_ODR.pdf (last visited Aug 29, 2020) [iv] NITI Aayog, Catalyzing Online Dispute Resolution (ODR) in India (2020), https://niti.gov.in/catalyzing-online-dispute-resolution-india#p3 (last visited Aug 31, 2020) [v] Trimex International v Vedanta Aluminum Ltd, 2010(1) SCALE 574. See also Shakti Bhog v Kola Shipping, (2009) 2 SCC 134 [vi] The Indian Evidence Act, 1872, Section 85B [vii] The Arbitration and Conciliation Act, 1996, Section 24 and 29B(3)(a) [viii] Bright Simons v. Sproxil, Inc, O.M.P. (Comm) 471/2016 [ix] Supra Note iii [x] India - internet penetration rate 2020, Statista, Statista, https://www.statista.com/statistics/792074/india-internet-penetration-rate/ (last visited Sep 7, 2020) [xi] Andrew Keen, How to Fix the Future 12-13 (Atlantic Books 2018)
Preferred Citation – Aviral Jain, “Online Dispute Resolution: Feasibility in The Post Pandemic India”, Arbitration & Corporate Law Review, Published on 5th October, 2020.