Sunday, March 16, 2014

ODR/ADR

Online dispute resolution was developed to create a more efficient system than the courts are capable of providing, especially for relatively small cross-border and internet transactions. Courts are simply too expensive and too cumbersome to resolve these kinds of conflicts. The nature of online communications allows for a more flexible conflict resolution process, one that is not tied to any one jurisdiction's legal rules and procedures. The vast majority of these online disputes are resolved by informal means, facilitated by the speedy communications allowed by the internet.

Is ODR therefore a form of ADR? Not necessarily. Remember that even the traditional, physical courthouse steers most cases toward informal resolution, whether by direct negotiation between the parties, settlement conferences with a judge, mediation, arbitration, or some other process. ODR does the same thing, resolving most cases though some form of facilitated communication. But ODR can also assist with settlement negotiations by providing a mechanism that allows bidders to make settlement offers that are not transmitted to the other side unless they are within striking distance of each other. Going a step further, ODR can provide parties with an adjudicated decision by a neutral person. Courts themselves are starting to conduct hearings and facilitate other communications online. The next step would be to program computers to decide cases. If computers can be programmed to play Jeopardy, why not teach them to adjudicate legal disputes?

Fixing the Economists blog

My fellow panelists on the program we presented this week at SXSW reminded me that algorithms are becoming sophisticated enough to decide fairly complicated questions. And disputants may not mind having their conflict resolved by a machine, as long as they view the process as fair. If that seems surprising, think of how many disputes are resolved by a coin toss, or a round of rock-paper-scissors, or the drawing of straws, all perfectly arbitrary procedures that people nevertheless accept and perceive as fair, probably because they would rather have a quick result determined by chance than argue over who goes first, or what to have for dinner. Software programs can achieve outcomes less arbitrary than a coin toss, once they are adapted to incorporate legal rules of decision. That might or might not be preferable to disputants. I wouldn't be surprised if programs are developed that could interpret contracts according to established legal rules, or adjudicate traffic accidents based on police reports, photographs, and other evidence. Lawyers and judges might find that a scary thought, but it's one that is encouraged by the tech conference I just attended, where it seems that all the young software engineers are busy designing systems that could put a lot of humans out of work. Ironic, since a lot of them are looking for jobs themselves.

ODR could eventually lead to a brave new world of robot courts, but even if we get there, there should still be a prominent place in it for facilitated party-to-party communications leading to consensual resolution of disputes.

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