It Is Not the Strongest of the Species that Survives But the Most Adaptable: The Case For Online Commercial Arbitration

A CCA BLOG

By Gary L. Benton,* CCA Fellow

Variations of the quote “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change,” are often attributed to  Charles Darwin. Those may have not been Darwin’s exact words but the point stands that survival requires adaptation.

That stands true in the world of commercial arbitration as well. For decades, parties, counsel and arbitrators have enjoyed the benefits provided by arbitration, among those: relatively informal procedures, cost savings, time savings, quality decision-making and increased predictability compared to court cases. Yet, commercial arbitration has been slow to fully embrace online technology.

Understandably, as humans, we prefer social interaction. We thrive on the occasion to shake hands, look someone in the eye and take in all of their interactions with us. Accordingly, in the ideal world, there is no replacement to in-person arbitration.

But we no longer live in the ideal world. The Covid-19 pandemic compels us to adapt to survive.  Fortunately, technology has developed to make online arbitration a viable alternative, be it for the next couple months or for the years ahead.

Online dispute resolution (ODR) has been with us for twenty years, although its use was for years largely limited to resolution of small claims by online retail providers. With each passing year, the use of ODR has expanded and it has been increasingly embraced by traditional ADR providers. As well, many mediators, in facing the challenge posed by the pandemic, have rushed to seek training on the use of Zoom and other videoconferencing technologies to conduct online mediations.

To date, the reaction of most counsel in the world of complex litigation and arbitration has been to postpone hearings. That’s a short-term solution that may work for now but it certainly delays justice and doesn’t help the business world move forward. For litigators, it may prove particularly ill-advised as the already over-crowded courts will be overwhelmed when they reopen.

The better solution, for many cases, is for parties and practitioners to embrace arbitration using online technologies. Already, most of the work involving prehearing conferences, discovery and motion practice is handled online through teleconferences and emails. Every major law firm now relies on online document rooms and electronic transfer of documents. There have been significant advances in cybersecurity protections so that professional cloud storage and transmission is now safer than mailing and working with hardcopy documents.

Many who resist online arbitration have not yet honed their online skills, and they often argue that observing someone in person is better than doing so by videoconference. Most who have already relied on videoconferencing for depositions and hearings disagree. They appreciate the ease of working remotely and the capabilities of new technologies that are high quality and allow them close up views of counsel and witnesses and ready online access to exhibits, among other features.

Online arbitration will not be the same as live arbitration. It has advantages and disadvantages. The flow of the hearing must be properly paced and problems must be anticipated. But the pros far outweigh the cons.

Undoubtedly, parties will want to embrace efficient processes, and may be unwilling to rely on counsel and arbitrators who prefer to travel to hearings if there is a more practical way to resolve a dispute on the merits.

Online arbitration works well if it is done right. It requires training of counsel and arbitrators on the use of technologies. Already there are protocols being published detailing procedural and technical requirements to ensure online proceedings are conducted fairly and effectively. As well, a number of litigation service providers are revamping their offerings to provide platforms and staffing to manage online arbitrations.

The health crisis facing us today is causing a sea-change in many aspects of our lives. Those in the world of dispute resolution who make the shift to online technologies may find that online arbitration provides benefits that litigation and in-person arbitration cannot. Others may wait it out, hoping that the world returns to its old ways. Those who don’t sit still, and adapt instead, are the most likely to survive.

If interested in contributing to the CCA blog, please email info@ccarbitrators.org.

*The views expressed are those of the author and do not necessarily reflect the views of CCA or any other organization.

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