Online Dispute Resolution: Are we ready for the ‘New Normal’? – Part 1

Online Dispute Resolution: Are we ready for the ‘New Normal’? – Part 1

This post is part of a three-series blogpost aimed at better informing parties and mediators about the benefits, challenges and suggestions to adapt to online mediation.

The ongoing Covid-19 crisis, has disrupted our everyday life, in manner that has undoubtedly proved this pandemic to be the most serious catastrophe of our times, both in terms of its impact on public health and the economy. It is unclear at this stage as how long the pandemic will last and therefore it is important that a safe, cost effective and convenient methods of dispute resolution is devised. Individuals and businesses are embracing the digital transformation alike in an effort to adapt. This adaption is likely to continue in the interest of safety and will therefore bring more long-term transacting users into the digital foray.

The silver lining to the ongoing pandemic is the acceleration of digitisation of disputes. Covid-19 has created an unprecedented need for courts, arbitral institutions and organisations to adapt at short notice to new and different ways of working and offer solutions to parties and practitioners that will enable dispute resolution in a time of quarantine and enforced social distancing.

This article shall proceed as follows. First, it attempts explain the mechanism of online mediation and the benefits it offers. Second, the article explores the various disputes that are best suited for online mediation in the context of Covid-19. Finally, it aims to highlight the responses of a few jurisdictions and their respective mediation institutes internationally.

What is online Mediation? What are its benefits?

Online Mediation is a process to settle disputes outside courts, combining technology and alternative dispute resolution (“ADR”) mechanisms. It covers disputes that are settled over the internet having been initiated in cyberspace. Online mediation offers a faster, transparent and accessible option for many companies to resolve disputes online particularly those who have high volume and low-value cases. It additionally allows individuals to take part in the mediation process within the comfort and safety of their own homes, a concern that gained heightened prominence in times of this pandemic.

There has been a recent explosion in the use of these technologies—not just for mediation, but for all teleconferencing—as individuals and companies try to continue moving the wheels of business forward even as they respect the guidelines of physical distancing: Zoom, WebEx, Google Meetings, to name just a few.

What sort of disputes are ideal for Online Mediation?

The pandemic has impacted both individuals and corporations alike in so far as their abilities to seek legal recourse during these times are concerned. It has also resulted in legal disputes, some of which are inter-personal and some other that are contractual. While online mediation has proven to be a worthy alternative to physical processes, this process is best suited to resolve certain types of disputes over certain others. Those disputes that are bound by time and require immediate redressal, as explained below, will therefore be best suited for online mediation.

1. Supply Chain disruptions: Covid-19 has brought much of the world’s production, transport and commercial activity to a near halt. The damage to business enterprises will be exacerbated by the diversion of financial and human resources into dispute processes not designed for exigent, and in certain cases existential, circumstances. A swift and succinct dispute resolution process is best suited for the commercial interests involved in such cases.

• Family and custody disputes: The number of domestic violence cases during the lockdowns have been steadily rising. This can have a damaging impact on women and children who become witnesses to such atrocities. A mediator can help resolve such issues to prevent further psychological damage and preserve the required relationships.

• Employment termination disputes: Covid-19 has led to rampant layoffs and premature termination of contracts as employers are unable to support their employees, which have resulted in multiple contractual and labour disputes. To ensure that a just compensation is paid to the employee and to further ensure that the employer is not dragged to prolonged legal battles, it is important that these issues are resolved efficiently and swiftly through online mediation.

International responses on Covid-19 and Online Mediation

In anticipation of a wave of disputes arising out of or relating to the COVID-19 pandemic, the idea of Online Dispute Resolution (ODR), especially online mediation, has once again been thrust into the spotlight in several jurisdictions such as Hong Kong, Singapore and the United States of America. This section aims to provide a brief overview of their responses and steps taken to actively promote online mediation.

In Hong Kong, as part of HK$137.5 billion relief package, the Hong Kong Government has announced its new COVID-19 ODR scheme aimed at providing parties with a way to resolve their legal disputes without the need to meet face to face. The ODR system in Hong Kong is a multi-tiered dispute resolution mechanism where the parties will first attempt to negotiate their disputes, followed by mediation and if that does not result in settlement, then subsequently to arbitration for a final and binding award.This increasingly formal and binding series of procedures is designed to follow the “Mediate First” policy that the government has been advocating under its “Mediate First” Pledge Programmes. The goal of the scheme is to offer “a fast and effective means to resolve disputes among parties.” It additionally incorporates practices such as setting eligibility requirements and ensuring transparency in obtaining the consent of both the parties and also contemplates “time limits” for each step of the mediation process.

In Singapore, The Singapore International Mediation Centre (SIMC) has recently launched the SIMC COVID-19 Protocol to provide businesses with an expedited, economical and effective route to resolve any international commercial disputes during the COVID-19 pandemic period. The SIMC has launched the Covid-19 protocol which complements Singapore’s COVID-19 (Temporary Measures) Act. As the Act provides temporary (and not permanent) relief from legal action, parties should make best use of the temporary reprieve to mediate a commercial solution that is sustainable for both parties in the longer term. It therefore recognizes online mediation as a viable alternative for changing times but does not advocate it as a substitute.

In the United States of America, more than thirty federal courts along with National Centre for Technology and Dispute Resolution have now begun adopting ODR mechanisms in the light of social distancing. In light of the same, the National Centre for Technology and Dispute Resolution, the pioneer institute for ODR, has adopted the “Ethical Principles for ODR Initiative” in order to ensure fair and ethical ODR.

Conclusion It is evident that the Covid-19 pandemic is presenting itself as challenge in more ways than one. It is a health, economic and legal crisis in equal measures. In times where physical distancing is mandated, online mediation presents itself is a suitable alternative to allay the legal disputes that require immediate redressal. In line with the spirit of the above-mentioned jurisdictions, legal systems across the word must take note of the benefits of encouraging online mediation and formulate mechanism to propel it.

(To be continued…)