The future of (Alternative) Dispute Resolution – Online Dispute Resolution and Cybercourts

I know it’s debatable, like everything else in life, but to me, the Internet has to be one of the greatest inventions of the twentieth century. Using the net is second nature to most of us and we use it to communicate, to learn, to share, to shop, to complain, to find love and to break it up, to play, and to engage in many other creative, productive and not-so-productive activities.

Global Communication

Today technology is also helping us resolve our disputes. Well, at least, it’s making it somewhat, albeit not totally, easier for us to try. The broader the scope of online (and offline) interactions and transactions, the broader the possibilities to enter into a dispute. The potential for conflict today has moved from the purely physical world, to the digital.

Enter Online Dispute Resolution (ODR)

Having gained widespread acceptance among the general public and the legal profession in recent years, Alternative Dispute Resolution (ADR) includes dispute resolution processes and techniques that are used by disagreeing parties to reach an agreement short of litigation, such as  mediation, arbitration and conciliation. Today, some courts even require some parties to try to resolve their disputes by means of an ADR platform,  usually mediation, before allowing their cases to be tried (the European Mediation Directive (2008) expressly contemplates so-called “compulsory” mediation; attendance that is, not settlement at mediation).

ADR platforms have gained popularity because they are typically faster, cheaper and easier to use for consumers than going to court. Set out of court and involving a neutral party who proposes a solution or facilitates the resolution of the dispute out of the parties’own accord, the majority of ADR procedures are not only free of charge for consumers, or at least inexpensive to use, but also a lot simpler and faster than the tedious and lengthy court proceedings we are all accustomed to.

Thanks to the accessibility of Information Technology of a great part of the world’s population (see, however, my post on the Digital Divide), ADR methods have been transferred to digital means of communication and promoted to facilitate the resolution of disputes between parties, particularly to consumer, transborder transactions.  Think about it – websites such as eBay, Amazon, monster and Expedia Travel allow customers to browse through their websites in order to inspect products and services and read customers’ reviews and ratings before making the final purchasing decision. Once they click on the shopping cart and the transaction is consummated after providing their credit card details and address, they receive the product selected after a few days. But  what happens when that product does not live up to the advertisement or endorsements? What recourse does the consumer have against a web-based company that does not provide a physical address?  As more and more consumer complaints arise, new dispute resolution ideas emerge to enable some type of online resolution.

Brave New World - Un mundo feliz - Schöne neue Welt

And although the application of ODR is not limited to disputes arising out of business to consumer (B2C) online transactions, it seems to be more fitting to these type of disputes because it’s logical to use the same medium (the Internet) for the resolution of e-commerce disputes, particularly when parties are frequently located far from one another.

A rocky start for ODR…

One of the aspects we love about Internet is its borderless nature. But when we talk about trying to resolve disputes between parties that are in many cases residents of different countries, the global characteristic of the Internet tend to come at loggerheads with the principle of national sovereignty regarding jurisdiction. It has proven hard to enforce a decision taken by ADR processes conducted online in a country because defendants know that it  will not affect them, or their business  in practice anyway. Conversely, why should a person want to sue if he or  she knows that there is nothing to  gain by doing so? If the decision is not  enforceable, the judgment will only be a piece of paper.

The lack of  understanding between nations regarding  enforcement may lead to actors on the  Internet disregarding courts decisions  and verdicts. Governmental initiatives are needed in this regard because as long as both ADR and ODR processes are not accepted governmental procedures,  their power will be built on consent  between the disputing parties which may always result in an unfair and uncertain  online environment.

Bjorn Johansson suggests the creation of actual physical borders on the Internet by means of geo-location technologies and a mandatory forum for Internet disputes to resolve some of the stumbling blocks described above.

… but a start nonetheless

Despite the difficulties encountered, countries in the European Union have recently seen a trend towards creating a network of centres that allow consumers to lodge claims electronically from their own homes, in their respective languages, where they can reach an expedient resolution to their disputes. As a result of Recommendations 98/257/EC and 2001/310/CE, the European Union formulated a major Directive on mediation -Dir. 2008/52/EC and three important legal texts pertaining to alternative dispute resolution in consumer cases and ecommerce transacionts are also currently being drafted.

These projects have the sound backing of a group of devoted professionals who have been championing the ODR cause at national, European and International level for quite some time now. The United Nations is also considering adopting a system of regulations to encourage the rapid development of inexpensive and effective electronic mechanisms to successfully resolve small disputes between businesses (B2B), and between businesses and consumers (B2C). A working group (WG III of UNCITRAL) has been entrusted with the task of proposing specific rules and preparing legal standards, a project that is sure to bring positive results in the near future.

At a private level, a number of ODR providers have paved the way since the early e-commerce days. I’m referring to eBay’s favourite ODR service supplier before it discontinued its mediation services in 2008, SquareTrade, insurance claims settlement facilitator Cybersettle and Odrworld.

Are we to be judged in holographic cybercourts in the future? 

We most probably will. In fact, several interesting projects are already up and running. In iCourthouse, for instance, plaintiffs register to join and fill out a complaint form, which is served to the defendant via e-mail. The parties must agree to be bound by a User Agreement and by Rules of Procedure. Other iCourthouse members may sign up to serve as a juror, selecting the type of case to consider, reading the trial books, posing questions, and then rendering a verdict. iCourthouse will display the award given by jurors.

But we can venture even further into what may appear to be a scene from Star-Treck rather than an anxious moment in the life of most ordinary citizens today?

You Have A Call...

Yes, we can. And in fact, we are already.

Telepresence, for instance,  enables parties in remote locations to feel as though they are meeting and communicating in the same room by creating visual conferencing environments that address the human factors of the participants and duplicate, as closely as possible, an in-person experience. Telepresence conferencing include true-to-life-sized three-dimensional participants, fluid motion, precise skin tones, true eye contact, absence of visible technology, studio quality video, lighting and acoustics, and immersive and/or mirrored environments so participants can feel that they are in the same physical location.

Cisco Systems, leader of the telepresence technological explosion, has created the Cisco Telepresence system recreated a boardroom like conference table that seats twelve people; up to six seats on one side of the table are made available through three 65-inch plasma screens with special lighting, microphones, integrated Ethernet and power,
and “multiple ultra-high-definition codecs and cameras.

The future of dispute resolution is here. We just need to make it accessible to everyone. And that is not an easy task.


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