Online dispute resolution resolves disputes through ADR and other forms of dispute resolution, but principally applies technological solutions to the process. ODR was born from the synergy between ADR and ICT, as a method of resolving disputes that were arising online, and for which traditional means of dispute resolution were inefficient or unavailable. In addition to the two or more disputants and the third neutral party, technology serves as a fourth party and changes the traditional three side model. The fourth party embodies a range of capabilities in the same manner as the third party. While the fourth party may at times take the place of the third party, i.e. automated negotiation, it will frequently be used by the third party as a tool for assisting the process.
Types of online dispute resolution.
Online dispute resolution involves mediation, arbitration, and negotiation to enable the dispute resolution.
Mediation is a private process where the mediator, who is a facilitator, helps the disputants to discuss the issue and try to resolve the dispute. An online mediation is usually commenced when an email is sent to the parties informing them of the basic information of the online mediation. Virtual meetings are conducted in “chat rooms” where the mediator can communicate separately with each party or simultaneously with both parties. There is usually one chat room for joint sessions, one for caucuses or “breakout rooms”, and another for filing and storing documents, all conducted through emails. The most popular form of online mediation is asynchronous online mediation as it allows parties flexibility and faster resolution of the matter compared to offline mediation. However, the downside to online mediation is that it dilutes some of the key features of mediation, which is the human relational aspect of mediation. Online mediation may not effectively capture the various needs, interests, motivations, and emotions of the parties involved. The use of emails to convey messages instead of a traditional dialogue may also embolden parties to make inflammatory comments which may not occur if they were in the same room with a mediator, a phenomenon that one can easily observe from social media. The effectiveness of communication at the mediation is also highly dependent on the parties’ literary skills in expressing themselves over email.
Arbitration is a process where a third party makes a decision concerning the dispute after going through the issues, arguments, and evidence. Compared to traditional litigation, arbitration is less formal; less complicated, and can be completed in lesser time. Online arbitration can have hearings through the use of video conferencing, but mostly requires parties to upload their evidence (documents), respond to questions from the arbitrator and they will receive a decision from the arbitrator. Arbitration is either binding or nonbinding. Where parties have agreed towards a binding arbitration, the arbitrator’s decision can be enforced by the courts. There is a new form of online dispute resolution which is currently being developed: The Blockchain Arbitration.
The blockchain arbitration has been developed as the dispute resolution mechanism of choice for disputes arising from smart contracts. Smart contracts are written entirely in code, and they automatically execute or enforce obligations. Blockchain arbitration has been developed in order to service the dispute resolution needs that may ensue from smart contracts. There are currently several models of blockchain arbitration being developed, such as CodeLegit and Kleros. CodLegit has drafted a set of Blockchain Arbitration Rules and envisions an Appointing Authority which will appoint an arbitrator who may be a jurist or a blockchain technician. Communications would be done by email and there might even be an oral hearing over video conference should the arbitrator call for it. This is in essence quite similar to online arbitration. Kleros on the other hand represents a different system of blockchain arbitration, in which the developers appear to be creating an entire quasi-judicial system, with a general court, followed by two tiers of sub-court divisions, e.g transport division and then air transport division.
In negotiation, no impartial third party assists the parties in their negotiation, so the parties work together to come to a compromise. The parties may choose to be represented by their lawyers during negotiations. Through the use of email, video conferencing, text and instant messaging, negotiations could take place. It goes without saying that the negotiators must be tech savvy, and there could sometimes occur technical challenges and difficulties.
Automated technology/tools used for online dispute resolution
The following are the mostly used automated tools for online dispute resolution:
- Blind bidding: These systems invite parties in dispute and ask them to submit their acceptable settlement offers with confidentiality and determine acceptable terms for both the parties. For example, Smartsettle.
3. Automated negotiation: These systems help in calculating all possible outcomes and also help the parties to arrive at a win-win situation as an outcome of the negotiation process. For example, Modria, Smartsettle.
4. Virtual mediation rooms: It facilitates mediation remotely in real time through videoconferencing. For example, ADR Group’s ADRg Express, Virtual Courthouse, Skype, and Zoom.
5. Arbitration systems: It facilitates arbitrators to conduct arbitration process online from different locations, through videoconferencing, and so on. For example, AAA /DecisionQuest’s CaseXplorer Arbitration eQuibbly, Traffic Penalty Tribunal.
6. Online court case initiation: Here, disputed parties or their legal representatives file claims and supporting documents through an online tool. For example, Rolls Building.
7. Online courts: Judges do the hearing and pass their judgments on cases by using an official online platform, without the need for face-to-face interaction with disputed parties. For example, eCourtroom.
8. Agreement monitoring: These are based on compliance and monitoring tools, which helps in reporting and analysis of agreements and identifying the breach of agreement. For example: Rechtwijzer, Our Family Wizard.
Technology is the future, and it is no longer news that most processes and traditional ways of doing things will become automated and assisted by information technology. Conclusively, it becomes imperative for lawyers, especially those interested in Alternative Dispute Resolutions to improve themselves and be more tech savvy in order to meet up with the technological disruptions that are rapidly occurring.