(This article is written by Astitva Kumar, a research associate at ICMCR.)

Alternative Dispute Resolution (ADR) has become an important aspect of the legal system in recent years since it allows for quick resolutions and often results in outcomes that are beneficial to both parties. Online conflict resolution is an extension of the same, with the sole difference being that it involves the use or help of technology in the resolution of disputes. This strategy is often compared to Alternative Dispute Resolution (ADR), but it incorporates technology to make the process more efficient. During the continuing COVID-19 Pandemic, ODR grew increasingly popular, with even regular courts using video conferencing to hear cases. While using Online Dispute Resolution as a method for resolving disputes can be beneficial to the parties because it provides benefits such as efficient management, ease of access, synchronized communications, and speedy disposal, it is also accompanied by many concerns about compromised confidentiality, literacy rates, and the actual ease of use by all.

Evolution of Online Dispute Resolution

In the early part of the 1990s, the online environment underwent a tremendous transformation. ISPs and the first graphical browsers came a few years after the World Wide Web was created in 1989. The most popular browser at the time, Netscape, was very user-friendly. As it became simpler to obtain Internet access, the online population continued to rise. It was realized that communicating and obtaining massive amounts of data was extremely simple. It was at this time, around 1994, that it became evident that cyberspace will not be a peaceful place in the future, and that there would be a need for tools, resources, and skills to deal with the inevitable conflicts. The first articles about ODR appeared in a law review in 1996,[1] the National Center for Automated Information Research (NCAIR) sponsored the first conference devoted to ODR in 1997, and NCAIR funding launched the first major ODR projects, the Virtual Magistrate and the Online Ombuds Office at the University of Massachusetts, and a family dispute ODR project at the University of Maryland. The Internet was twenty-seven years old at the time. The Hewlett Foundation gave a grant to the University of Massachusetts to create the Center for Information Technology and Dispute Resolution a year after the NCAIR meeting (later the National Center for Technology and Dispute Resolution). In the mid-1990s, courts began grappling with jurisdictional issues such as determining where an event happened when parties were in different locations and conversing online.[2] Therefore, the need for ODR arose. Many ODR start-ups arose and subsequently vanished during the Internet “bubble” of 1999-2000. Only a few survive, including Smartsettle, Cybersettle, and The Meditation Room. In 2006, SquareTrade, eBay’s initial ODR supplier, moved its focus from ODR to consumer warranties. In 1999, ICANN and the Uniform Dispute Resolution Policy were established to resolve domain name disputes. It was mostly an offline procedure when it began, but it has grown increasingly online over time. Thus, this is how the evolution of ODR took place.

Online Dispute Resolution

Online conflict resolution is a method of conflict resolution that uses technology to assist parties in resolving their conflicts. The most typical procedures utilized are negotiation, mediation, arbitration, or a combination of the three.

In ODR, information management is handled not just by humans, but also by computers and software. Because ODR is considered as an independent input to the management of the conflict, Katsh and Rifkin have labeled ICT’s aid as the ‘fourth party.’[3] The designation of technology as the fourth party, in addition to the two (or more) disputants and the third neutral party, is a clear metaphor that emphasizes how technology may be as strong as to overturn the old three-sided paradigm. In the same way, as the third party does, the fourth party embodies a wide range of talents.

Advantages

  1. Economically viable: One of the most important considerations in conflict settlement is cost since disputants like to get the best possible outcome for the least amount of money. Because most papers are shared by email and the processes are conducted online rather than by mail, ODR best matches the budgetary expectations of all parties to a dispute. The expenditures of travel and lodging, as well as the location for holding the proceedings, are all removed. As a result, ODR is not only less expensive, but it is also easier and quicker.
  2. Speedy resolution: ODR has several advantages over standard ADR, one of which is that it takes less time. Unlike ADR, which might take months to resolve a dispute, ODR ensures that concerns will be handled within weeks. Furthermore, because the internet is borderless, communication concerns between parties and their counsel who may be in different time zones are reduced. Furthermore, parties can access real-time statistics and other information about their cases through the internet. E-mail simplifies the strain of planning ODR procedures and removes the need for phone or fax calls, in addition to being convenient. The internet is also a superior and quicker form of communication since it allows several parties to simultaneously send and store documents, saving time and money.
  3. Non-confrontational mechanism: ODR permits the adjudicating body to decide the issue impartially and only on the merits of the case by removing the adversary’s physical presence. Furthermore, because most online debates or dialogues take place asynchronously, disputants have time to think about their positions before answering. Furthermore, because there may be several instances in which one side of a dispute is a small-time manufacturer/supplier and the opposing party is a global corporation, such a method eliminates any economic or other power imbalances between the disputants.
  4. Neutral forum: The internet offers a neutral forum for adjudication and the “home advantage” that parties enjoy.

Disadvantages

  1. Hardware concerns- Apart from the internet issue, various hardware issues render the ODR unavailable to a large segment of the population. The data prices in India are the lowest in the world; for example, in the United States, a GB of data costs Rs. 592, but in India, it costs just Rs. 7. However, supplying low-cost data does not imply that the equipment necessary to use it is easily available. As a result, a lack of infrastructure and access to computer resources is creating a significant impediment to the growth of ODR.
  2. Awareness- The next technological stumbling hurdle in the path of ODR is user awareness. Users’ knowledge of technology and digital literacy is among the lowest among internet users worldwide. More than 90% of Indians are unaware of the extent and correct use of the internet and technology and are fully reliant on the younger generation for even the most basic Facebook and WhatsApp setup. As a result, people’s lack of understanding and mental barriers must be addressed and enhanced for it to be accessible to the general public.
  3. Training and Infrastructure- Another key impediment to Online Dispute Resolution’s accessibility is a scarcity of educated specialists. Even though 10% of the Indian population is deemed digitally literate, this literacy is mostly found in the informal sector. However, India’s courts and justice system work on a procedural basis, and transferring them to a new platform would necessitate a well-trained and enhanced support structure. Only until the justice support system has been educated will they be able to go further in informing people about ODR and other online court mechanisms.

Methods of Online Dispute Resolution

The Methods of ODR include:

  • Synchronous ODR is a type of dispute resolution in which the parties speak with each other in real-time via video conferencing.
  • When communication is conducted asynchronously, it is done so via email or other similar communication technologies rather than in real-time.
  • Online mediation is proving to be the most popular method of dispute resolution, with approximately 70% of ODR platforms employing it to obtain a decision. Typically, online mediation begins with parties receiving an email with basic information about the proceedings, followed by virtual encounters in chat rooms.
  • Electronic Arbitration is a less common kind of online dispute settlement, although it does help to conceal the process to some extent.[4]

Differences in Online Dispute Resolution and Traditional Model of Dispute Resolution

The conventional dispute resolution mechanism is the same as the ODR System. The main distinction between the two notions is the mode/medium of practice, not the content of the concepts. The ODR system is internet-based, which means that users may undertake operations via a website, or through a service or content provider’s website. The parties can use digital communication tools to submit requests by filling out electronic forms and exchanging information over the internet via secure channels. Parties and neutrals communicate electronically, as well as by voice and video. Automatic alerts are among the features of the system.

Procedural Rules for ODR

Organizations that provide online dispute resolution in their specialized domains of e-disputes have established procedural rules. This online institutional dispute resolution has gained the public trust and provided an efficient alternative to national court litigation, particularly in e-disputes where the parties to a dispute are frequently from different jurisdictions and the issue of jurisdiction becomes a preliminary objection in and of itself. In ODR, on the other hand, this issue of disagreement never occurs since parties agree to resolve their cross-border e-disputes in the form and manner that they both agree on.

Most Common Organizational Rules

  • ICC Rules of Arbitration and ICC Rules of Optional conciliation
  • International Center for Settlement of Investment Disputes model clauses
  • WIPO’s Arbitration and Mediation Rules.
  • UNCITRAL Arbitration and Conciliation Rules
  • London Court of International Arbitration’s model clauses for arbitration rules.
  • American Arbitration Association`s model clauses for arbitration rules[5]

Operation of Online Dispute Resolution

E-bay

Every year, ODR is used to settle more than 60 million disputes between eBay traders. There are two major mechanisms at work here. In cases of non-payment by purchasers or complaints by buyers that the things supplied did not match the description, the parties are advised to settle the problem through online discussion at first. They are helped in this by well-structured, practical counsel on how to prevent misunderstandings and come to an agreement.

Youstice

Youstice is an online dispute resolution business that handles enormous amounts of low-value customer complaints about both products and services, regardless of whether the purchases were made online. There are two tools available. The first makes it possible for parties to negotiate. It aids in the structuring of arguments by allowing participants to define their viewpoint by picking from a list of terms that are accompanied by appropriate symbols. The website also proposes appropriate solutions, which are represented by icons.

Support to Online Dispute Resolution extended through judicial precedents in India’s ADR system

  • Shakti Bhog v Kola Shipping

The use of technology in the arbitration procedure was acknowledged by the Supreme Court. The court also supported the legality of online arbitration agreements including emails, telegrams, or other forms of telecommunication that serve as the agreement’s record.[6]

  • Grid Corporation of Orissa Ltd. v AES Corporation

To choose an arbitrator, the Supreme Court enabled citizens to consult via electronic media and remote conference.[7]

  • State of Maharashtra v Praful Desai

This acceptance was extended to current ways of communication, with the court upholding video-conferencing as a valid method of capturing evidence and witness testimony.[8]

  • Central Electricity Regulatory Commission v National Hydroelectric Power Corporation Ltd[9]

The ultimately permitted summons to be served through email as well as other methods.

  • Kross Television India Pvt Ltd v Vikhyat Chitra Production

The Bombay High Court has recognized the use of instant messaging apps for service of process and has allowed summons to be served via WhatsApp.[10]

  • M/S Meters and Instruments Pvt. Ltd. vs. Kanchan Mehta

The court recognized that technical tools may be completely relied upon to resolve conflicts. The court noted that some issues may be resolved partially or wholly ‘online,’ and suggested that basic instances like traffic challans and check bouncing be resolved through online processes. Online Dispute Resolution is the way of the future, and encouraging its usage during the lockdown will have a significant influence on the judicial system when the lockdown is lifted. According to Jeffrey N. Rosenthal, an attorney at Blank Rome, the appeal of ODR services to the general public will only grow. The availability of such systems can help firms gain confidence by reminding customers and businesses that a neutral third party can resolve issues quickly and cheaply. India, on the other hand, is yet to reap the benefits of ODR. In this aspect, there is a severe lack of legislative action or awareness. This issue is compounded by India’s lack of ODR institutions.[11]

Conclusion

Dispute resolution systems have progressed significantly in human culture throughout time. The establishment of online dispute resolution tools was motivated by the need to resolve disagreements quickly and cheaply. With the massive growth of the internet market, the ODR mechanism needs extensive public awareness and training, which may be delivered at the grass-roots level through social media, education, street plays, marketing, conferences, seminars, and campaigns, among other methods. As a result, expanding ODR is a critical step toward promoting global harmony and international collaboration in the resolution of cross-border conflicts.

[1] E.Katsh,“Dispute Resolution in Cyberspace”, 28 Conn. L. Rev.(1996) 953; E.C. Lide,“ADR and Cyberspace: The Role of Alternative Dispute Resolution in Online Commerce, Intellectual Property and Defamation”, 12 Ohio St. J. On Disp. Resol. (1996) 193

[2]  Zippo Manufacturing Co. v. Zippo Dot Com, Inc., 952 F. Supp. 1119 (W.D. Pa. 1997) and Bensusan Restaurant Corp. v. King, 126 F.3d 25 (1997).

[3] E. Katsh, and J. Rifkin, J. Online Dispute Resolution: Resolving Conflicts in Cyberspace (San Francisco, Jossey-Bass, 2001).

[4] Online dispute resolution (ODR): A positive contrivance to Justice Post covid- 19 – litigation, Mediation & Arbitration – India, Welcome to Mondaq, https://www.mondaq.com/india/arbitration-dispute-resolution/935022/online-dispute-resolution-odr-a-positive-contrivance-to-justice-post-covid-19 (last visited Jan 22, 2022).

[5] Niti Aayog, https://www.niti.gov.in/sites/default/files/2021-11/odr-report-29-11-2021.pdf (last visited Jan 22, 2022).

[6] Shakti Bhog Foods Ltd v. Kola Shipping Ltd, AIR 2009 SC 12 (India)

[7] Grid Corporation of Orissa Ltd. v AES Corporation 2006 134 CompCas 305 Orissa

[8] State of Maharashtra v Praful Desai (2003) 4 SCC 601

[9] Central Electricity Regulatory Commission v National Hydroelectric Power Corporation Ltd (2010) 10 SCC 280

[10] Kross Television India Pvt Ltd v Vikhyat Chitra Production 2017 SCC OnLine Bom 1433

[11] M/S Meters and Instruments Pvt. Ltd. vs. Kanchan Mehta 2017 (4) RCR (Crl.) 476