Remote Arbitration: is the future inevitable?
The Covid-19 pandemic has had a huge impact on the world of dispute resolution, whether litigation, mediation or arbitration. Since the global shutdown, international arbitration hearings have had to be conducted online rather than in person. Whether you call it ‘virtual’, ‘remote’ or ‘online’, it comes to the same thing: all parties involved attend through one of the many platforms available on the internet, such as Zoom, Teams or BlueJeans. Many arbitral institutions have issued protocols or updated their rules to help make remote arbitration (including electronic rather than ‘wet ink’ signature) the norm.
There is considerable discussion whether remote arbitration will replace physical meetings once the pandemic is over. Remote arbitration has several advantages; the most striking being cost. The main cost benefits are:
The huge saving in airline fares and hotel expenses for all parties involved in international arbitration.
The saving in travelling time.
The saving in printing, with almost everything done electronically.
The result of this is that fixed hearing dates are likely to be arranged more quickly. Various platforms have a shared screen function, and showing the relevant document on screen will make for more efficient hearings. Online hearings generally have one, agreed, electronic bundle, which saves time.
The Kaplan Opening – named after the distinguished arbitrator, Neil Kaplan CBE, QC, SBS – is a hearing after the first round of written submissions and witness statements, but before the substantive hearing. It enables counsel to outline their respective positions to the tribunal, thus helping the tribunal in its preparation, and can result in a shorter main hearing. A platform like Zoom makes this session more attractive to the parties because of the savings from not having to travel. It also makes it easier for the tribunal to meet and discuss the case before the main hearing (the so-called “Reed Retreat”).
Online arbitration is also likely to make submissions more focussed, cross-examination shorter, and hearings quicker.
What are the downsides?
There are, however, significant disadvantages to online arbitration. The first is the cyber-security risk of online hearings. It is essential that access to the hearings be controlled, and that the storage and transmission of personal data be limited. To this end, it is vital to consider the platform’s terms and conditions. Parties will have to be careful with the use of breakout rooms. Recently, a High Court judge in London was embarrassed when she made a disparaging comment about one of the parties to a case before her, wrongly thinking that her microphone was switched off.
Another disadvantage to online hearings is the cross-examination of witnesses, whether expert or factual. That is because it is difficult to assess a witness’s body language when all you can see is their face. There is also the risk of a witness being coached by someone in the same room, or receiving information by email or messaging. That risk can, however, be mitigated by a neutral person in the witness’s room, or by a 360 degree camera and a mirror behind the witness, as well as the witness having an empty desk. Nonetheless, online cross-examination deprives the cross-examiner of seeing the effect on both the tribunal and the opposing lawyers of points made in cross-examination. Furthermore, technological disruption might adversely affect what might otherwise be powerful cross-examination. In any event, online cross-examination via an interpreter can cause problems.
There are various technical matters that need to be dealt with for online hearings. Thus parties will need multiple screens: one to see the other parties or witnesses, one for the document bundle, and one for the transcript. There will need to be testing sessions, and backup facilities in case of a technological failure. Teams must have ways of communicating with each other: if a lay client is in one country, a solicitor is in another, and lead counsel is in a third, they will need something like WhatsApp to be able to communicate. Participants will have to speak clearly, and avoid over-speaking. Non-active participants will need to remember to mute themselves.
Most people who arbitrate online find it much more exhausting than being in a room. For that reason, daily hearings will have to be shorter, and will need regular breaks. Tribunals will also have to be careful that one side is not at a disadvantage because of its country’s weaker technology, such as narrower broadband width. Moreover, differing time zones will have to be taken into consideration. One side might complain that it has not had a fair hearing if the arbitral hearing times are late at night where it is, as opposed to mid-morning for the other side.
There might be problems of enforceability of awards resulting from online hearings where one party opposes such a hearing and wants a physical hearing. But that is a topic for another day.
In summary, online arbitral hearings are likely to be particularly helpful in short hearings. In long hearings, they do have advantages but here significant disadvantages also stand out.
Robert Rhodes QC, in business crime (e.g. civil and criminal fraud, tax investigations, bribery and money laundering), international mediation and international arbitration at Outer Temple Chanbers.
Image: jagritparajuli99, Pixabay licence.