What is ODR?

At a preliminary level, ODR refers to the usage of ICT tools to enable parties to resolve their disputes. This includes using simple to complicated communication technologies such as audio-visual tools ranging from telephones to smart phones to LED screens, spread sheets, e-mail and messaging applications, with the crux of it being to enable dispute resolution without physical congregation of the parties.

From instances seen around the world, in its first phase, ODR shares its fundamentals with ADR mechanisms such as negotiation, mediation and arbitration. To this extent, most of the early ODR efforts have mirrored ADR processes through aggregated use of simple ICT tools.

ODR however is not to be understood to mean just e-ADR. At a more advanced stage, ODR can work as the fourth party through the use of algorithmic assistance tools that help parties find resolutions. Such technology can take the form of intelligent decision support systems, smart negotiation tools, automated resolution, and machine learning. Eventually, ODR can also offer multi-door dispute resolution through tailored processes for specific parties and their dispute. With the help of technology tools, these tailored processes can be designed to achieve an ideal dispute resolution for all the disputants.

Why ODR?

Legal Health Promotion: ODR can play an important role in promoting legal health by making people aware about the law, their rights and duties, and the remedies available with them. For instance, in the European Union, it is mandatory for merchants to inform the consumers of the option to avail ODR. Similarly, tools can be developed where parties can feed in questions and get answers on the rights and protections. Thus overall, ODR can help in moving towards a more ‘rule of law’ based society.

Dispute Avoidance: Data driven development of ODR tools can provide citizens information to make informed choices based on the strength and weaknesses of the position of law. For example, the study of thousands of credit disputes can help parties identify, even before a dispute has arisen, the stages at which the disputes are likely to occur, thereby providing them an opportunity to pre-emptively address any likely challenges. Additionally, ODR can also help parties identify the likely outcome of the case if the rights are agitated in that situation. Thus, ODR can help people recognise and avoid legal obstacles and thereby, disputes.

Dispute Containment: At a primary level, ODR can enable informal and pragmatic containment of dispute before it enters court systems.19 ADR processes such as mediation and arbitration already provide an avenue where disputes can be resolved before they reach the courts. In this light, ODR, in effect, can add a digital layer to ADR and make it more efficient. For instance, mandatory pre-litigation ODR cases involving e-commerce claims, small cause claims and cheque-bouncing issues can be resolved before they reach the courts system. This is extremely critical for Indian judiciary, which has a burgeoning case-load.

Benefits of ODR

Cost effective

The economic burden of dispute resolution often turns the process itself into a punishment and thereby hinders access to justice. In this light, ODR offers a cost- effective mode of dispute resolution for the disputants as well as the Neutrals. By its very nature, ODR does not require parties to travel long distances or rent a facility to conduct the dispute resolution. Further, ODR has the potential to reduce legal costs, by way of reduced time for resolution and by doing away with the need for legal advice in select categories of cases.

Apart from these tangible costs, there are other indirect costs, often faced by enterprises, on account of lengthy litigation proceedings. For instance, enterprises see loss of productive time, loss in wellbeing of the individuals, loss in investor confidence, reduced investments and consequently slower economic growth. While all these impacts cannot be completely remedied by ODR, it can help in mitigating them and therefore prove to be cost effective

Convenient and quick

The pendency of cases in Courts across India has been one of the major challenges for the justice system. As per the India Justice Report, 2019, in 21 States and Union Territories, cases in District Courts remain pending for 5 years on average or more. Excessive adjournments, vacancy in judicial and administrative staff, and complex processes involving multiple participants are some of the major reasons for such pendency.

ODR can address such delays by providing a faster and more convenient process for resolution of disputes. In itself, ADR employs simpler procedures and a fixed timeline for processes leading to efficient dispute resolution. To add to such benefits, ODR eliminates the need for travel and synchronisation of schedules. This reliance on asynchronous communication, allows parties to submit their arguments intermittently, or follow a ‘documents-only’ process. Not requiring the physical presence of parties also reduces the need for travel thereby especially benefitting parties involved in cross border disputes. Similarly, use of ODR within businesses such as e-commerce entities also provides consumers a one-stop avenue to resolve their disputes thereby making dispute resolution quicker and more convenient.

Allows for customisable processes

Over the past few years, ADR has seen a lot of variants emerge, that go beyond the traditional ADR processes such as arbitration and mediation. Some of the hybrid variants include med-arb, med-arb-med, arb-med-arb. ODR’s integration with such non-traditional ODR processes and use of artificial intelligence can lead to limitless possibilities in terms of the types of models that can be developed. Thus, ODR can allow for multi-door dispute resolution through curated and customised process for certain classes of cases. This in turn, can make the dispute resolution process more cost effective and convenient for the user.

Encourages dispute resolution

ODR can contribute significantly to improve access to a variety of dispute resolution processes by addressing major concerns such as lack of access to physical courts or ADR centres, cost of dispute resolution as well as the barriers due to disabilities. Since ODR tools such as online negotiation and mediation are premised on mutually arriving at an agreement, they make the dispute resolution process less adversarial and complicated for the parties. Resolving disputes in the comfort of the user’s own homes can make the dispute resolution process feel more accessible. This improvement in the overall experience can encourage more parties to opt to resolve their disputes through such formal means as opposed to not agitating their rights at all.

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