Can we bring about fundamental change?

By David J. Bilinsky

And it’s a sad picture, the final blow hits you
Somebody else gets what you wanted again
You know it’s all the same, another time and place
Repeating history and you’re getting sick of it...

– Music, lyrics and recorded by Taylor Swift

What does business want from the justice sector? One could argue that they desire a just, speedy and inexpensive way of resolving consumer disputes. If we look for examples of innovators in this area, eBay and PayPal are leading the pack of companies that have invested heavily in Online Dispute Resolution (ODR) systems over the last decade. They continue to do so because they know that solving customer problems is a positive and key aspect to how their companies do business. It is important to note that they have specifically gone around the justice sector in coming up with their dispute resolution system.
Note that the eBay/PayPal ODR system handles more than 60 million disputes per year. Of these disputes, 90 per cent are resolved entirely by software. Moreover, the majority of cases are resolved amicably. They have extensive research that indicates that their ODR system promotes the further use of eBay and PalPal – even by parties who “lose” their dispute. They have invested considerable funds in building their online dispute resolution system because it is good for business and good for their consumers.

What has happened is that eBay and PayPal have built a private civil justice system for a virtual country or community. It is independent of any judicial system in any country. And the message that it is sending over the judicial world should not be ignored. We have to bring about innovative change within the justice sector – or it may well occur outside – in fact, it is already happening.

In my view, any real innovations in dealing with fundamental change and innovation in the justice sector have to start with an examination – a realization if you will – of the inherent structure of the Justice System. For example, the present justice system is:

• Synchronous: All parties must attend the courthouse at the same time.

• Serial: Each case follows the one before it in order to be heard by the presiding judge or court official.

• Expensive: Each bricks and mortar courthouse has to be built and staffed.

• Geographically Tied: All parties must attend the court that is hearing the case.

• Jurisdictionally Tied: For the most part, each case is heard according to the laws of the jurisdiction where it is filed.

• Adversarial: Win/Lose not Win/Win.

• Involves Transactional Costs (TC): TC = Hard costs + loss of opportunity costs. The longer the resolution time, the greater the transactional costs.

• Involves Delays: We are seeing headlines today on the increasing delays in the justice system. We all know that justice delayed is justice denied.

• Limited Availability: It used to be that courts and bankers kept the same hours. Courtesy of the Internet, banks are open 24/7. Courts, however, are not.

• Involves a Judge: For the most part, a case must be heard and determined by a judge. This means that the judge represents a bottleneck in the system.

The Challenge in bringing about real change and innovation in the justice sector involves realizing these structural constraints and asking yourself:

• How can you structure a dispute resolution system that tries to break down one or more of these constraints?

• What would that system look like?

• What would be the advantages to those involved in the dispute that don’t currently exist in the present justice system?

• What about disadvantages?

In my humble view, one possible dispute resolution system that does try to break down one or more of these constraints is: Online Dispute Resolution (ODR).

ODR has two big advantages on its side:

1. ODR, being non-adversarial, helps the parties to maintain a relationship after the dispute is resolved. (such as disputes that fall into the areas of: Family law, employer-employee, neighbours and e-commerce (to avoid class-action suits) where it benefits all parties to resolve the dispute because they have to continue to deal with each other).

2. ODR is increasingly accessed via mobile technology. (Mobile technology brings justice to the people rather than the people coming to justice).

So – what is ODR?
ODR incorporates dispute resolution processes that are:

• Facilitative: processes such as conciliation, mediation, and facilitated negotiation.

• Advisory: processes such as case appraisal, mock trial, and neutral evaluation.

• Determinative: process such as arbitration and adjudication.

• Since this is online dispute resolution, these processes are assisted by technology, especially the Internet.

• There are two basic forms of ODR:

• Technology Based: such as Blind Bidding systems that seek to resolve quantum-based disputes by facilitating confidential offers until the gap between bids is narrowed (without disclosing to the parties the amount of each party’s bid).

• Technology Assisted: Where technology is used to assist persons trying to resolve a dispute.

• What are the advantages of ODR to the parties and to society?

• Asynchronous: Negotiations can take place any time over the Internet.

• Parallel: Each case can be determined independently of any other.

• Inexpensive: Websites are cheaper than courthouses to build, staff and maintain.

• Spans Distance: Parties do not have to attend a physical location.

• Non-Adversarial: ODR seeks to preserve the relationship between the parties.

• Lowers Transactional Costs: ODR offers shorter resolution times + lower transactional + economic costs.

• Seeks Speedy Resolutions: ODR is more concerned with good and fast solutions.

• 24/7 Availability: Courtesy of the Internet, ODR is open 24/7.

• Doesn’t Involve a Judge: eJury and other sites are experimentations in online juries. EBay and PayPal are trying online community courts.

For the most part, ODR is still jurisdictionally tied (eBay and PayPal are one big counter-example). But UNICTRAL (The United Nations Commission on International Trade Law) and others are trying to design ODR systems that are independent of any territorial laws, at least in terms of cross-jurisdictional disputes.

Here is the challenge: If we don’t bring about fundamental change to the justice system, we may find that many disputes have been taken away from the justice system and are resolved by other means. If we wait and don’t bring about fundamental change, we may well find that someone else got what we wanted – again.

SPECIAL NOTE: David has recently been made a Fellow of the National Center for Technology and Dispute Resolution (NCTDR) at the University of Massachusetts. (www.odr.info)

The views expressed herein are strictly those of the author and may not be shared by the Law Society of British Columbia. David J. Bilinsky is the Practice Management Advisor for the LSBC. Email: daveb@lsbc.org; Blog: www.thoughtfullaw.com.

This article originally appeared in the June 2012 issue of BarTalk and is reproduced here with permission of both the author and the Canadian Bar Association, British Columbia Branch.