The forces against virtual arbitration - Ben Giaretta, Partner at Mishcon de Reya

The forces against virtual arbitration - Ben Giaretta, Partner at Mishcon de Reya

 

I think we are on the verge of a technological transformation of arbitration. This has been coming for some time: there has been a lot of discussion of technology in arbitration over the past few years. But it has always been slightly in the background. Arbitration conferences, for example, have typically put technology sessions in the 'graveyard' slots around lunchtime or at the end of the day.

The pandemic has changed all of this. Now, technology is front and centre. Arbitrator practitioners have embraced online working as part of their daily lives. I believe that virtual arbitration, in which the whole or almost the whole of the arbitration is conducted online, will continue to be significant after the pandemic is over. It is important to recognise, however, that there are forces against this, and below I highlight three of the most powerful. I don't think these forces will turn back the clock entirely, but they may have unintended consequences.

 

Exceptionalism

 

First, there is the myth of exceptionalism. Individuals like to feel that they are different, not one of the herd. I remember that when I was at school, one particular teacher would proudly say that computers may be fine for others but he still preferred his trusty pen. The irony of that was that he was in his late 20s, rather than approaching the end of his career, and he was no Luddite whose occupation was threatened by new technology. He just wanted to stand out from the crowd.  Similarly, today, I hear some lawyers say that working on screens is not for them, whatever the masses do; instead they prefer hard copies and a hearing in person.

As a variant on the myth people tell about themselves, some say that the particular matter they are working on is too important or too complicated for virtual arbitration. Tied up in this is the idea that an in-person hearing is the superior version. Let others drive their mid-market Nissans, Peugeots or Volkswagens; we will have our Rolls Royce. The arbitrator's voice is only genuine when spoken in person, our matter is too significant for messages to be filtered through technology.

In fact, exceptionalism is often merely a failure of imagination. We do not think we can adapt to the new technology, so we do not try. When we have been forced by the pandemic to do so, our eyes have been opened.

 

Personal interest

 

Secondly, there is the motivation - whether conscious or not - of personal interest. Some try to dampen down enthusiasm about technology because it is in their interest to do so.

No decision about any technology is neutral, of course. There are vested interests even behind its promotion and adoption. Tech companies want to sell their products. Institutions may have staked their reputations on particular platforms. Individuals use their familiarity with the technology as a way to sell their services.

Similarly, some people reject virtual arbitration because it suits their interests. They may have made their name as a result of their expertise at in-person hearings and are unwilling to risk this by learning a new way of doing things. Or they may want to distinguish themselves from their competitors by demeaning their rivals' favoured approaches.

Personal interest can change over time, of course. The more people see that virtual arbitration is popular, the more they will take a different view of it. But in the short-term, at least, this may be a constraint on progress.

 

Irrationality

 

Thirdly, we should recognise that there is very often an element of irrationality in someone's thinking. They may reject new ways of working out of an irrational fear of the unknown. Others may react against the general tide of technology by opposing a particular development within arbitration. Or they may worry this is the thin end of the wedge: today virtual arbitration, tomorrow dispute resolution via artificial intelligence. Instinct may be a person's primary driver rather than making a balanced assessment of the options available, even if they give a different impression when they explain their position.

Of all the contrary forces, this may be the most significant because it comes from deep-rooted feelings about technology. Such attitudes cannot be easily overcome. Time is a great persuader, however, and greater familiarity (as well as clever packaging) might allay some of these concerns.

 

Unintended consequences

 

If virtual arbitration is here to stay, these contrary forces are likely to remain as well, and they may have unintended consequences – particularly when married up with any issues that might arise with the technology (and there is good chance that such issues may occur).

We may find that divisions within arbitration become even greater. The biggest cases might use less technology (or use technology less well) than smaller disputes, and, with some exceptions, the leading arbitration lawyers may be marked out by their continuation of older practices. We may find that the elite band of arbitrators may become even more highly prized: they are the ones that we will fly around the world to conduct hearings in person while the less renowned remain behind their computer screens.

What might be most surprising, though, is if we find that opposition to technology actually hastens the move towards virtual arbitration. The more there is a holdout against new ways of working, and a continuation of older practices, the more arbitration using technology can distinguish itself as a cheaper and faster way of resolving disputes. The narrower the ranks of the elites, the more there will be people outside who will advocate for new approaches.

Alternatively, this opposition might lead to a decline in arbitration. Tech-enabled court litigation in some countries may become much quicker and cheaper; while mediation, shorn of all technology, will remain more human and 'real'. What space is then left for arbitration? We may find that arbitration needs to overcome the opposition, and embrace the new technology, in order to survive.

 

 

Ben Giaretta is a Partner in the Dispute Resolution department of Mishcon de Reya LLP, specialising in international arbitration. Ben is also one of our experts who write for the LexisNexis product. Click here to read his legal content and understand more. 

 

Further reading

 

Arbitration

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Dispute Resolution

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Whatever the challenge, LexisPSL Dispute Resolution is the place to start.

Our team of experienced lawyers give you the answers you need, in a way that’s easy to digest. You get clear, concise practice notes – with direct links to the relevant judgments and legislation you need. Checklists and flowcharts to guide you through legal or procedural issues. Precedents, with practical explanations and drafting tips, to help you prepare the documents you need in less time.

 

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About the author:
Ben Giaretta, Partner at Fox Williams LLP, is an international arbitration lawyer with a wide range of experience across many different sectors.  He is a Chartered Arbitrator and Fellow of the Chartered Institute of Arbitrators, and is the current Chair of the London Branch of the Chartered Institute of Arbitrators. He is a member of the Consulting Editorial Board of Lexis PSL Arbitration.