Will 'online dispute resolution' have its day in Court?

Will 'online dispute resolution' have its day in Court?

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Author: Lauren Lee

The Online Dispute Resolution Advisory Group produced a report in February 2015 which supports a movement towards online dispute resolution (ODR).

The report highlights the challenges faced by the current court system and the criticisms raised by those using it such as lack of affordability, accessibility and consistency.

Most people will welcome a reform of the court system which will facilitate a more efficient and cost effective approach to access to justice but can such a system actually be delivered?

Recommendations

The report calls for a radical overhaul of the current court system in handling low value claims (with a value of less than £25,000) and recommends the introduction of an Internet-based court service known as HM Online Court (HMOC). HMOC would decide cases entirely on an online basis and should therefore increase access to justice but reduce the cost of the court system.

HMOC would operate as a three tier service as follows:

  • Tier One: Online Evaluation. This stage would help users to classify and categorise their problem
  • Tier Two: Online Facilitation. The aim of this stage would be to bring the dispute to a speedy, fair conclusion without the involvement of Judges. Online facilitators would review papers and help parties through mediation and negotiation
  • Tier Three: Online Judges. The Judges would decide cases on an online basis based on the papers submitted to them electronically and would be supported, where necessary, by telephone conferencing facilities

Will it work?

Cynics amongst us may say that more money should be spent on getting the current system fit for purpose before ploughing it into a new system but the report addresses these issues by making the following observations:

  • If cases are taken out of the current court system and put into an online environment, it will reduce the fixed and operating costs dramatically and, ultimately, fewer court buildings would be required
  • The costs of disposing of cases through facilitation will be considerably lower than that of Judges deciding the cases
  • There is already reliable technology available to set up ODR and the set-up costs should, therefore, be covered by the court fees that parties would pay
  • The costs involved would be modest in comparison to the current expenditure on maintaining and upgrading the current system. It would certainly be a tiny fraction of the £75 million that is being allocated annually for the next five years for the civil justice reform programme

The report also lists various entities which use ODR already such as eBay, Canadian Civil Resolution Tribunal, Rechtwijzer 2.0 (Dispute Resolution process in the Netherlands), Online Schlichter (online mediation service for Business-to-Consumer e-commerce and direct selling disputes) and the Financial Ombudsman Service to name but a few. Ebay resolve around 60 million disagreements each year amongst traders through ODR. It does, therefore, seem to be a sensible recommendation in principle.

Notwithstanding the above, there are also some concerns about whether HMOC would provide a fair trial. While the report concludes that ODR can provide a fair hearing under Article 6 of the European Convention on Human Rights, it will be interesting to hear the findings of Mr Jordi Xucla, a member of the Parliamentary Assembly of the Council of Europe, who is currently preparing a report on the human rights of ODR.

Conclusion

If the report is approved by the Civil Justice Council, the Judiciary and HMCTS there will be two further phases of work that will lead to the full implementation of HMOC. The first phase will be piloting, designing and awareness-raising which is expected to be progressed throughout 2015 and 2016. The second phase will be establishment of HMOC which is expected to be launched in 2017.

Whilst HMOC, by its very nature, will never have its day in court, it certainly looks like it will be the future of the court system in England and Wales for claims with a value of less than £25,000.

Disclaimer

This document is for informational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given.

About the Author

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Lauren Lee

Associate

03700 86 5689

Lauren is a banking litigation solicitor who specialises in invoice discounting and factoring disputes, receivables finance litigation and recoveries, and asset finance disputes. Lauren acts on behalf of major clearing banks, asset based lenders and insolvency practitioners in both the County Courts and High Courts.

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