Online dispute resolution : an analysis - iPleaders

13–16 minutes

This article is written by Yamini Gupta and the article is edited by Khushi Sharma (Trainee Associate, Blog
iPleaders)

We have witnessed tremendous change in the legal systems all across the world. India amongst all, also has
been striving to adopt a system-design approach for its legal system. The transition of dispute resolution
through conventional courts to alternative means have led us to arbitration, conciliation, mediation, judicial
settlements and Lok Adalats. With time, the concept of Online Dispute Resolution has evolved as a result of
effective familiarization and utilization of technology. This article discusses the evolution and significance
of online dispute resolution.

 Introduction to ODR
 Need of online dispute resolution in India
 Advantages of ODR
 ODR is the future of access to justice
 Conclusion
 References

Introduction to ODR
As technology has changed the way individuals interact, it has also changed the way we resolve our
disputes. With technological advancements, a new notion of dispute settlement known as ‘Online Dispute
Resolution’ has emerged, changing the picture dramatically in just a few months. Catalyzed by the situation
of the outbreak of COVID 19 non-physical activities like virtual hearings and e-filings have increased
significantly.

In the late 1990s, ODR’s growth coincided with the expansion of internet. Initially, e-commerce websites
such as eBay employed Online dispute resolution to promote customer trust by promptly and efficiently
addressing disputes. The eBay platform enabled customers to lodge a complaint and commence the
resolution process online. If the settlement attempt fails, an online mediation process would commence. The
platform was designed to diagnose the problem and conduct automated negotiation followed by mediation or
arbitration[1]. This concept, which has since evolved into more sophisticated variations that are extensively
employed by various private businesses and governments alike, is popularly referred to as the ODR
(Online Dispute Resolution). Many countries, like the United States, Canada, Singapore, and the
Netherlands, pioneered ODR later on. Subsequently, the practice of resolving disputes online has also been
integrated by many more countries.

Farah defined ‘Online Dispute Resolution’ to mean utilizing information technology to carry out alternative
dispute resolution[2]. Schiavetta explained that the online dispute resolution comprises of a process to resolve
dispute exclusively online and also other dispute resolution process that use internet[3]. As valuable and
useful as the internet has been to us, it nevertheless has its negatives. Many intrusive activities are linked to
its use, which can lead to a variety of e-disputes such as invasion of privacy, cyber terrorism, breach of e-
contracts, identity theft, and so on. ODR encompasses not only e-disputes that are unique to the internet but
also traditional disputes that can be addressed using information technology, such as unfair trade practices,
intellectual property infringement, and so on.

Need of online dispute resolution in India

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As we have witnessed that India has seen a rapid growth in the field of lawful means, from conventional
courts to adopting alternate means of dispute resolution which fostered the development of Arbitration,
Conciliation, Mediation, Judicial Settlement and Lok Adalat. The primary underlying issue does not lie in
the right means to access justice, but to the increased number of cases filed on a daily basis. This not only
reduces the court’s workload, but it also speeds up the delivery of justice and makes it more cost-effective
for general public.

The process of ADR involves physical proceedings which are most of the times barred by the geographical
limitations, and during the times of COVID-19 such limitations have become peculiar. And in order to
overcome such a situation, it is needed that we adapt and utilize potentially advantageous solution called
online dispute resolution. It provides us with recourse of settling dispute through online means in the form of
arbitration, negotiation or mediation with the use of modern technology like video conferencing and online
circulation of documents.

The emergence of Online dispute resolution in India can be both cost effective and less time consuming. It
would further be beneficial to disputes which are left unheard because of various reasons either due to cost
or time issues, such disputes can take recourse of ODR which is both cost efficient and less time consuming.
Amid the outbreak of COVID 19, disputes related to lending, property, credit, commerce and retail are
resolved through ODR, which is one of the impactful part of economic revival. 

There have even been certain cases when the courts have recognized the need of having ODR procedures
across the courts. In light of the COVID-19 pandemic, even the present Chief Justice, Justice Bobde, has
emphasized the importance of taking efforts to make courts virtual in order to avoid the shutdown of the top
courts. Online dispute resolution method in India is at its initial stage and with time more and more people
are taking the recourse of ODR for the purpose of resolving disputes. Many ODR platforms have been
established such as CADRE, SAMA, Centre of Online dispute resolution, AGAMI etc. NITI Aayog, in
collaboration with Agami and Omidyar Network India, recently hosted a meeting on ‘Catalyzing Online
Dispute Resolution in India,’ where key stakeholders were brought together to work cooperatively to ensure
that attempts to scale online dispute resolution in India are made. During the conference, it was agreed that
ODR has a huge amount of potential for India, especially when it comes to small and medium-sized
conflicts. It has the potential to improve access to justice and ease of doing business, since effective conflict
resolution will be essential in revitalizing the economy in the midst of the COVID-19. The supreme court
also pioneered the growth of ODR in India, recently in State of Maharashtra vs Dr. Praful B. Desai[4] The
Supreme Court of India ruled that video conferencing is an admissible means of recording witness
testimony. As a result, the legislative framework, as well as precedents set by the Supreme Court of India,
encourages the use of technology for dispute resolution and encourages the implementation of ODR
techniques. It is also clear from a combined reading of the Indian Evidence Act of 1872, the Arbitration and
Conciliation Act of 1996, and the Information Technology Act of 2000 that Indian laws provide for the
legality and technological viability of ODR processes. Even, we also now have virtual court facility in India
which enables the Litigants to file the plaint electronically through e-Filing and also pay the Court Fees or
Fine online through https://vcourts.gov.in Litigant can view the status of the case also online through various
channels created for service delivery.[5]

It is noteworthy that on an average every judge in India is allocated 1,350 cases, whereas his counterpart in
the US is required to deal with only 388 cases[6] As a result, promoting and strengthening a technology-
driven dispute resolution process not only appears promising for attorneys, but also improves the efficiency
of the Indian legal system.

Advantages of ODR
The following are the main benefits of ODR-

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 1. Speedy Resolution- One of the prominent advantages of ODR is that it is less time consuming in
comparison to conventional courts. As there has been significant increase in the number of disputes
involving consumer issues, transactions and other isuues. The most convenient choice appears to be
ODR, which provides an efficient basis for implementing a speedier dispute resolution system, on
the other hand where ADR takes several months to pass an award, ODR offers dispute resolution in a
matter of weeks.
2. Feasible from a financial standpoint- It not only provides speedy resolution but also is economically
viable. As the process of arbitration involves physical proceedings which are most of the times
barred by the geographical limitations, travelling and being present physically is in itself have
become expensive and complicated.
3. It is possible to avoid complex jurisdictional difficulties- One of the prominent issues of
geographical limitation can be avoided with the help of ODR. It further remodels the system of
dispute resolution from justice administered in a court room to a service that can be availed
anywhere.
4. Useful in resolving cross border disputes- In order to address this issue, early adoption of
online dispute resolution (ODR) has been focused on resolving e-commerce transactions where
parties are located in different jurisdictions, as well as low value disputes arising out of both business
to business as well as business to consumer transactions, where going to court makes little economic
sense.

ODR is the future of access to justice

Richard Susskind propounds that access to justice encompasses four layers – legal health promotion, dispute
avoidance, dispute containment and authoritative dispute resolution.[7] He points out that the traditional court
system has only been concerned with the latter two of these issues. He is correct. This remark holds true for
both India and the United States. When it comes to resolving conflicts and keeping the court system
operational on a virtual level, the country’s judiciary has consistently turned to technology. However, the
moment has come for the emphasis to shift from dispute resolution to dispute avoidance, containment, and
enhancing the overall legal health of the country.

Investing in online dispute resolution (ODR) through the use of more advanced second generation
technologies can assist India in its transition to a future judicial system.

 Newer ODR technologies, ones that not only use legal principles but also expand to better economic
principles for settling civil disputes, are expected to come from the private sector, as has been the case with
ODR thus far. The court and the administration must collaborate with these skills and adopt them for the
benefit of the general public, thereby making it imperative for them to do so. As difficult as it may be to
fathom, the future of dispute resolution focuses in technology and perhaps artificial intelligence. It is
possible that ODR will play a significant part in this by developing approaches for more unbiased evaluation
of legal connections in order to take early action. In terms of institutional readiness, expertise, and
technology capacity, it is clear that India already possesses the key elements necessary to implement a
comprehensive framework for the use of technology in dispute resolution. 

Conclusion
Dispute settlement strategies have gone a long way in human civilization through the years. Fast and
inexpensive resolution of disputes has been a primary objective for the creation of online dispute resolution
(ODR) mechanisms. With the enormous expansion of the online market, the ODR mechanism requires
widespread public knowledge and training, which may be achieved through social media, education, street
plays, marketing, conferences, seminars, and campaigns, among other means, at the grass-roots level. The
participation of the government is also extremely significant in granting financial assistance to ODR projects
and assisting in the development of technical and administrative infrastructure necessary for the
establishment of an ODR process.

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To ensure that all groups of society have access to justice, it is imperative that the system’s reach be
expanded to include as many as possible of them. Strong infrastructure for easy access and for ensuring that
justice is delivered in a timely and adequate manner must be built by increasing literacy rates, reducing
language and cultural barriers, and providing easy access to e-courts may be a stepping stone towards
achieving the aforementioned goals. Consequently, advancing ODR is an important step in facilitating
global concord and encouraging international cooperation in the resolution of cross-border disputes.