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Online Dispute Resolution in India

Techniques for resolving disputes range from procedures in which the parties have complete control over the procedure to methods in which a third-party control both the process and the outcome. Information and Communication Technology (ICT) can be used to supplement these fundamental methods of settling disputes (ICT).

When most of the dispute resolution method is completed online, such as the initial fle, the neutral appointment, evidentiary processes, oral hearings if necessary, online discussions, and even the rendering of binding settlements, the process is referred to as ODR.As a result, ODR offers a unique method of resolving conflicts from start to the end while sticking to due process norms.

Online dispute resolution (ODR) is still in its early stages in India, but it is rapidly growing. With the implementation of the Information Technology Act in 2000, e-commerce and e-governance gained formal and legal recognition in India. Even India's traditional arbitration law has been reformed, and the country now has the Arbitration and Conciliation Act, 1996, which meets the UNCITRAL Framework's harmonised standards. Section 89 of the Code of Civil Procedure, 1908, was added to provide alternative dispute resolution (ADR) methods in India.This can also include ODR.

Currently, there are three primary mediums for dispute resolution enabled by technology:

  1. AI dispute resolution
  2. Online courts.
  3. Online or electronic mediations and arbitrations.

But ICT integration with ADR or e-ADR should not be simply understood by ODR. As articulated by Richard Susskind, ODR can provide an integrated access to justice through the following phases in the life cycle of the dispute:
  • Promotion of legal health:
    ODR can play a key role in the promotion of legal health through knowledge of the legislation, rights, duties and means at their disposal. Overall, ODR can contribute to a society based on 'rule of law.'
  • Dispute avoidance:
    ODR can help to avoid disputes by establishing legal education and settlement modules to enable citizens to make informed decisions on the basis of their legal strengths and weaknesses. It will also help them recognise legal barriers and avoid them. Such legal guidance and awareness can lead to a society that is more compliant and prevent disputes from happening.
  • Dispute Containment:
    ODR may allow informal and practical containment of disputes at primary level prior to entry into court systems. Disputes can play an important role in the control of disputes, such as online mediation and online arbitration.

Court-related ODR

Three key elements distinguish court-related ODR from other forms of technology-assisted dispute resolution:

  • The first is that the programme is only available online. Unlike other court programmes that offer an online interface through which to complete discrete tasks (e.g., e-fling, video hearings), ODR users do not interact with the court for traditional in-court procedures or events.
  • The second distinguishing feature is that the programme is explicitly intended to assist litigants in resolving their dispute or case, rather than serving as a technology platform to support judicial or court staff decision-making. Dispute resolution inherently includes the possibility of contesting the validity of claims or raising affrmative defences; court related ODR is more than just a forum for defendants to negotiate a payment schedule to satisfy debts.
  • Third, the judicial branch hosts or supports the programme. It is not a form of private ADR, but rather integrates and extends the judicial branch's dispute resolution services into digital space in order to serve citizens efficiently, effectively, transparently, and fairly.

The process for ODR is stated below:

  • The ODR process involves fling e-documents, in which parties may use encryption or electronic signatures to ensure document integrity and transaction authentication
  • The parties usually seek support for the appointment of a neutral panel of judges or panelists by an ODR service provider for dispute settlement using online resources.
  • Parties prefer a structured and clearly defned procedure when a simple and defnite resolution process
  • In the resolution of online disputes by mediators or other alternative methods of dispute resolution, institutions such as WIPO, SIAC and ICC enjoy an established reputation.
  • Negotiation occurs frst, when communication is initiated, and mutual agreement is made to move the proceedings forward.
  • ODR serves as an administrator as well as an infrastructure provider.
  • The complainant seeks compensation or other remedies by fling the complaint and the respondent provide detailed replies when it consents to participate in the proceedings
  • Oral proceedings via video conferencing may or may not take place. This varies depending on the circumstances.
  • Many times, a dispute can be resolved using specially designed software without the presence of a third party. This is known as Algorithmic Dispute Resolution.
  • The party who is dissatisfed with the compensation can reopen the case within a certain time frame. After it gets reopened, the arbitration procedure will begin.
  • According to the International and Domestic Arbitration Centre (IDAC) of India, the completion of arbitration proceedings entails four basic steps, namely:
    1. The disputed parties are served with a notice
    2. To carry out the proceedings, arbitrators are appointed.
    3. Proceedings and hearings are carried out.
    4. Execution of the award.

Advantages and disadvantages of ODR

It is important to consider both sides of the coin.

The following are the advantages and disadvantages of ODR:

  • ODR provides the disputants and neutrals with a cost-effective means of dispute resolution
  • Delays can be tackled by providing a fast and convenient dispute settlement process.
  • ODR eliminates travel requirements and timetable synchronisation
  • It increases community participation in the dispute resolution process.
  • With the help of an independent mediator, ODR parties may negotiate their own settlement. The ODR meetings are thus adaptable and without procedural rules being strict.
  • ODR can make an important contribution to better access to a wide range of dispute resolution processes by addressing signifcant issues such as access to physical courts or ADR centres
  • ODR processes reduce the neutral's unconscious prejudice when disputes are resolved.
  • It makes the process of storing data easier.
  • The ODR process saves both time and effort.
  • Improved legal heath of the society.
  • ODR is also capable of transforming the entire legal paradigm.

Over the last few decades, digital technology has increased effciencies and reduced costs in a variety of industries. However, there may be some lingering scepticism about ODR in the legal feld, not least because of concerns about the dehumanisation of human-centric processes.

While there are obvious safety and timesaving benefits to ODR, there are several risks and drawbacks to consider:

  • When using third-party applications, there are risks to confidentiality, as well as a technological inability to handle the varying complexity of legal cases
  • It is diffcult for the advocate, arbiter, and mediator to build trust with the parties.
  • The disadvantages of not appearing in person include less fluid discussions, less engagement or strategic discussion of issues, and greater diffculty reading body language.
  • A lack of human understanding and empathy
  • Disadvantages for those who are not technologically savvy
  • There is a lack of accountability, regulation, and guidelines.
  • The possibility of algorithmic bias.

Implement ODR in a Phased Manner

The paper recommends that ADR and mainstreaming of the ODR in India be a stepped-up modular strategy.

Phase 1: ODR for COVID-19 related disputes
As a result of the COVID-19 pandemic, a probable upsurge of cases to be brought before the judiciary will occur. This includes family disputes, labour disputes and consumer disputes. Fortunately, ODRs can adequately tackle all these kinds of disputes without the physical presence of all parties being required. Hong Kong has already used ODR in the MSME sector to deal with COVID-19 related disputes. For the purpose of promoting awareness and capacity building by co-opting expertise in the private sector the Department of Law and Justice and NITI Aayog can play an active role. In order to boost the private sector, the Ministry of Finance and Ministry of Electronics and Information Technology can lead.

Phase II: Mainstream ODR

In order to achieve integration of ODR in India, a favourable ecosystem of law and policy will require it. It will also require government initiatives to support the ODR through the use of digital infrastructure, build trust in the ODRs, amend laws to enable the ODRs and train people to act as neutrals for the ODRs. The government should work towards enhanced legal culture in society, especially through the ODR procedures, by encouraging out-of-court dispute resolution.

Phase III: ODR as a primary mode of dispute resolution

During this stage, sustained efforts are needed to build the capability and infrastructure to exploit innovations in the ODR and make them accessible throughout the country. Furthermore, the government will, when and when needed, be able to address the challenges posed by the dynamic ODR ecosystem through regular modifcation and amendment to the regulatory framework for ODR. As objectives for Phase III, the following can be considered.
  • Encourage the avoidance of disputes to minimise the influx of cases into the judiciary.
  • The use of technology and ODR to promote legal health,
  • Encourage innovation and business in the ODR.
  • ODR diverts cases to reduce judicial outstanding situations.

NITI Aayog planning

The new frst of its kind Online Dispute Resolution (ODR) manual was planned for launch by NITI Aayog in India. The new manual was launched with the support of the ICICI Bank, Ashoka Public Innovators, Trilegal, Dalberg, Dvara, and the Omidyar Network India.

This new manual invited business leaders to adopt ODR in India, according to a release by NITI Aayog. It underlines the need for such a mechanism, for the ODR models that companies can adopt and for an operational path.

The opening address was given by Justice DY Chandrachud, Supreme Court of India and a manual was launched. The launch also featured Nit´┐Ż Aayog, Chief Executive Offcer Amitabh Kant, Poornima Sampath and Sumit Gupta of TATA, Head of Collections, Udaan.

ODR handbook is a watershed document for dispute resolution: Chandrachud

The official release read:
ODR is the resolution of disputes outside courts, particularly of small and medium-value cases, using digital technology and techniques of alternate dispute resolution (ADR), such as negotiation, mediation, and arbitration. While courts are becoming digitized through the efforts of the judiciary, more effective, scalable, and collaborative mechanisms of containment and resolution are urgently needed. ODR can help resolve disputes effciently and affordably.[1]

ODR has the capacity to increase equity, fairness and access in India in the dispute settlement ecosystem. E-Lok Adalats conducted at Chhattisgarh, Karnataka, Rajasta, Gujarat and soon Kerala in several countries, which solved disputes simply by means of WhatsApp audio and video calls, showed the convenience of ODR. Supply-side capacity can also be improved by providing a large, competent pool of services for award and representation.

ODR has the potential to be an effcient alternative which employs barriers and resolution access technology. ODR could be the post-pandemic disruption that improves the delivery of justice to all by facilitating low costs, remote, technology-enhancing, linguistically friendly, friendly and incentivised dispute resolution, containment, and solution while adhering to natural justice principles.

  1. (2021, April 10). Online dispute resolution to decentralise justice delivery system:
    DY Chandrachud.

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