1. Introduction

One of the most important changes in our society during the last ten years has been the increasing use of networks and information technology for communication and information processing. This development has had a noticeable effect on dispute resolution.

Electronic dispute resolution is a general term encompassing various uses of information technology (IT) in resolving disputes, be it through litigation, arbitration, mediation or other processes. The use of IT to prepare documents such as complaints, responses, verdicts and awards is already commonplace. Video screens displaying virtual reality2 and Internet access are playing an increasing part in hearings. Most dispute resolution practitioners now exchange documents by e-mail on an everyday basis. Computerized systems for managing cases and workflow have proved to be invaluable administrative tools.

The introduction of IT in arbitration needs to be carried out with prudence, giving preference to proven applications and taking into account the desires of users, not least because of the size of the investment involved. The IT project undertaken in 1999-2002 in the Dutch appeal courts offers a cautionary tale. This project, which cost 16 million euros, turned out to be totally unusable. 3 The initial aim was to use the most recent technology for managing cases and workflow. Summons and verdicts were to be generated automatically without any need for human intervention, and communications with the police and public prosecutors were also to be partly automated. However, the project was suspended, due to its complexity, and when it was restarted its goals were more modest. It proved to be impossible to set up a basic workflow management system. Processes turned out to be more complicated than at first envisaged, due to amendments and exceptions to the law. One practical example is that if a person who is taken to court for speeding pays the fine in the courtroom before the proceedings start, the case is dismissed. This is standard practice, although not formally allowed. Software developers are therefore faced with the question of whether to follow the law or practice. Another problem encountered by the project was that users had insufficient knowledge of technology and their input was too detailed and not attuned to their actual needs.

Where private methods of dispute resolution such as arbitration and mediation are concerned, the need to recover the costs of IT investments is crucial, so wariness should be the watchword. [Page36:]

International research shows that computerized case-management systems are widespread within the judiciary. 4 These systems have contributed to the reduction of case loads and helped to reshape the organization of courts. In the United Kingdom, emphasis was placed on implementing IT in the courts in the wake of Lord Woolf's reforms in the mid-1990s. Although the initial results fell short of expectations, the courts became more amenable to the use of new techniques. 5 In 2003, a breakthrough came with the introduction of the so-called COMPASS system for the Crown Prosecution Service in England and Wales. Attorney General Lord Goldsmith characterized the project as follows: 6

The CPS COMPASS system is more than just a way of managing casework. It is a leading example of the kind of transformation that is needed across the Criminal Justice System if we are to achieve the truly efficient and joined-up justice that everyone wants and deserves.

Another example is the introduction of IT by the Singapore judiciary, which over ten years (1992-2002) gradually transformed a sluggish, entirely paper-based system with a backlog of thousands of cases into a smooth-functioning, modern organization. 7 One reason for this success was the way in which the changes were introduced: time was taken for the judiciary to become used to working with the new applications before they were made fully operational. Although the main focus during these ten years was on case management, several innovative techniques were introduced, including a technological courtroom8 offering parties involved in proceedings access to the Internet and thus to information stored in computers at their office. Modern technology is now commonplace in the Singaporean courts and includes videoconferencing in courtrooms, mark up languages such as eXtensible Mark-up Language (XML), wireless application formats (WAP), and short messaging services (SMS) to keep parties updated.

Case management systems are one of the obvious uses of IT in arbitration too, as illustrated by the ICC International Court of Arbitration, which decided to develop such a system as early as 1989. 9 A case management system is an administrative tool to aid those who handle cases. In this paper we do not discuss this type of internal IT use but concentrate instead on what could be called the external use of IT, that is to say in interaction with the parties. For this, the Internet is ideal as it is an excellent means of disseminating information and communicating, which are crucial to any arbitration procedure.

Emphasis will be placed on a particular type of electronic dispute resolution: online dispute resolution, or ODR. ODR can be defined as any form of dispute resolution in which the Internet is wholly or partially designated as the virtual location in which to solve a dispute. It should be noted that ODR does not necessarily mean that the entire procedure is conducted online. Even occasional use of e-mail for communication purposes during an arbitration may rank as ODR, although it will generally be considered as low-profile ODR. At the other end of the spectrum is a fully online procedure.

This paper will begin with a brief introduction to online arbitration. We shall then look at the solutions adopted by some existing providers with respect to case filing, which is where arbitration starts. This will be followed by some general observations on how dispute resolution institutions can integrate IT into their procedures. The paper will conclude with reflections on the future of online arbitration. [Page37:]

2. Online arbitration

Of all existing dispute resolution mechanisms, arbitration seems to be the most natural to conduct online. One reason for this is that the records brought into arbitration proceedings are mostly in writing and can easily be replaced by electronic files as most paper documents are nowadays generated using computers. However, doubts might be expressed as to the feasibility of processing information electronically when, as is often the case in international arbitrations, huge quantities of documents are involved. At the present time, limited bandwidth may be an obstacle to communicating large volumes of electronic data. In this case, consideration might be given to exchanging the bulk of documents at the start on CD-Roms or DVDs. 10 However, this is but a temporary problem, as restrictions on bandwidth are likely to be overcome in the next couple of years, opening up the possibilities foreseen in ICC's NetCase project: 11

Practitioners need to work . . . during their travelling time or at home . . . without being burdened with hard copies of voluminous documents. As an alternative to carrying documents with them in their laptops or CD-ROM, they will be able to access documents directly in NetCase.

The management of large quantities of electronic files, without hard copies necessarily being available, would therefore seem an entirely serious option. Indeed, the Court of Rotterdam is currently (2003-2004) conducting a pilot project in which all documents relating to major criminal cases are handled in electronic format only.

A second reason for thinking that online procedures are particularly suited to arbitration is that the parties are often far apart and may even be on opposite sides of the globe. Such physical separation becomes insignificant online.

It is therefore not surprising that one of the first ODR initiatives was an online arbitration project: Virtual Magistrate. 12 This project, which began in 1996, dealt with only one case. It was brought by American Online (AOL) and concerned spam on the Internet. However, the parties settled before a decision was rendered.

In 1994, prior to Virtual Magistrate, David Stodolsky had launched a less well known project called Net Judges. 13 Coincidentally, the purpose of this initiative was to combat spam. 14 It set out to develop a program that could determine whether a posting in a newsgroup was spam, and, if it was characterized as such, to automatically delete the message in question. 15 A list of over 40 'judges' was created whose role was to decide on a one-person-one-vote basis whether cancellations of postings in news groups were appropriate and to develop policies for cancellations. It appeared that the Net Judges were not only interested in combatting spam, but also in judging on issues relating to content, such as libel and copyright violations. Although their intentions might have been noble, the Usenet Community was not ready for such self-acclaimed 'emperors'. This was no doubt due largely to the fact that, whereas most modern forms of ODR presuppose an agreement to co-operate, the Net Judges' decisions were to be enforced irrespective of the will of the parties. 16 This can be compared to the forced transfer of domain names discussed below.

A further and more successful example of online arbitration are the domain name dispute resolution services offered by providers approved by the Internet [Page38:] Corporation for Assigned Names and Numbers (ICANN) for its Uniform Domain Name Dispute Resolution Policy (UDRP). 17 Like most online arbitration to date, 18 the procedure is non-binding. It is possible to initiate legal proceedings in respect of the domain name that is the subject of the complaint not only after the panel has made a decision but also prior to or during the arbitration. 19 Since the beginning of 2000 a total of some 5,000 cases have been handled, most of them by the Arbitration and Mediation Center of the World Intellectual Property Organization (WIPO). The awards rendered are not covered by the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention), or at least there is no use in applying the Convention, for either the decision upholds the existing situation (the respondent remains entitled to the domain name), or the domain name is transferred to the complainant. In the latter case, the transfer is part of the procedure and is performed by the registrar, so no cooperation is required from the opponent in order for the award to take effect.

Despite the existence of dozens of online arbitration providers, successful ODR initiatives are rare and the number of cases arbitrated online, other than those under the UDRP, is negligible. 20 This is not, or at least not primarily, due to legal obstacles. Back in 1999, Richard Hill concluded 'that there are no significant legal obstacles to on-line arbitration and that there is no need to modify existing laws or international treaties'. 21

We believe that an important reason for the failure of online arbitration services is the limited added value they offer parties involved in arbitration proceedings. Most providers simply offer facilities for storing case information electronically and for exchanging such information via e-mail. However, parties do not necessarily need an ODR provider for that.

Predictions vary as to the time it will take for the shift from physical to virtual dispute resolution to occur. 22 Our feeling is that it is not that far away, as the next five years are likely to see the emergence of high bandwidth Internet connections through mobile devices using third generations systems such as UMTS (Universal Mobile Telecommunications System) or 3GPP (3rd Generation Partnership Project). However long it takes to reach whatever level of IT use, the role of IT in arbitration is undoubtedly set to increase in the coming years. Whilst initiatives such as those taken by the ICC International Court of Arbitration to adapt its working methods to such changes are therefore timely and important, this development also invites reflection on the place and role of ODR providers in international commercial arbitration. Our intention here is to prompt such reflection by focusing on one particular aspect of arbitration procedure: case filing.

3. Case filing in online arbitration

This is the first and most important step in any online arbitration procedure. An adequate intake form is crucial for it sets the tone of the arbitration procedure and, if properly designed, helps to give the parties confidence in the procedure. The provider must strike a balance between asking too much and too little, and make sure that all relevant information is obtained. We shall briefly look at three providers of online arbitration that may be considered as a representative selection: MARS, WIPO arbitration and Onlineresolution. 23 We shall compare the intake forms of each provider and point out those aspects that stand out as particularly positive or negative. On the basis of our observations, we shall [Page39:] conclude by suggesting a few guidelines for the design of case filing forms in online arbitration.

3.1 MARS

MARS uses a single registration form for both claimant and respondent. The personal information is divided into two sets of similar entries, the second of which is preceded by the following statement: 'If you are the Claimant, please provide the following information about the Respondent so that we can contact them.' We believe that for reasons of clarity different forms would have been preferable depending on the role of the party.

Information about the dispute itself has to be entered into a single field, which is preceded firstly by instructions intended for the claimant - 'Please state the type of claim, a short summary of the reasons for the claim and monetary damages sought.' - followed by similar instructions for the respondent. There is otherwise little guidance for the claimant and the respondent. We again believe that a distinction between the claimant and the respondent would be preferable. Also, the use of a single space for case information neglects the opportunity online forms offer for structuring such information.

3.2 WIPO Arbitration and Mediation Center

The WIPO registration form is, by contrast, almost overburdened with details and instructions are provided for each and every field. Is it really necessary, for instance, to add alongside the telephone, fax and e-mail fields the instructions 'specify telephone number', 'specify fax number', and 'specify e-mail address'?

Another point worth noting is that some information has to be entered more than once, which introduces unnecessary interdependence into data. For instance, the email address has to be entered as many as three times: in the general contact details (3), when specifying the preferred method of communication for electronic-only material (5), and for the purpose of receiving electronic confirmation of the submission (21).

The form's strong point is the way it structures information, with over 20 fields to fill in. For a claim to be successful under the UDRP, three cumulative conditions have to be met: confusing similarity with a trademark, no legitimate interests and bad faith registration. Each of these central issues is registered in a separate field.

Additional information would have been better presented as a link rather than appearing on the form. Such information can be helpful in formulating the issues, but it should be left to the individual user to decide whether or not to consult the information. Including it in the form itself makes the form unnecessarily long and detailed.

3.3 Online Resolution

Onlineresolution has a single intake form for claimant and respondent. Unlike MARS, the instructions do not distinguish between the claimant and the respondent but are of a general nature. A suggested improvement would be to display the address information provided by the claimant when the respondent fills in the form. Although this would not change the form, it would save the [Page40:] respondent from having to fill in the the claimant's details as well as its own. It might not even be necessary for it to provide its full contact details if these, or some of them, have already been provided by the claimant.

Not all fields in the form have to be filled in, but only those that are required (marked by a red R). This is a nice feature as it accelerates submission by allowing unessential fields to be left blank. Those fields which are shared by both parties are indicated: 'The dispute is regarding . . .' This helps to make the form more transparent. Although not marked as such, we assume contact information is also shared.

The form uses a roll-down menu for the amount in dispute. One of five options may be selected, ranging from less than 500 dollars to more than 50,000 dollars. A similar feature is also used for the date on which the dispute started, with separate roll-down menus for the day, month and year. These forced entries facilitate input for the parties and the streamlining of information for the provider. However, care should be taken if fixed variables are used. For example, the options available for the year in which the dispute started range from 1998 to 2001, which reflects the recentness of the site.

3.4 Lessons learned

Based on the above observations, we would make the following suggestions for the design of intake forms:

• Information should be structured in obvious fields with not too much information for each field.

• The instructions should be short; fuller instructions should be provided by means of links.

• A different form should be used for each party.

• Information already known to the provider should be included on the form.

The guiding principle should be to provide adequate support for users without creating undue complexity.

4. Considerations on the future use of IT in online arbitration

In the light of the above analysis we will touch upon three issues that we believe are currently crucial to online arbitration. These issues concern the ownership and control of IT facilities for arbitration, the enforcement and coordination of standards of procedure, and the enforcement and coordination of standards of exchange.

Who should own and control IT facilities for arbitration?

There are two obvious approaches here, namely a centralized and a liberal approach. With a centralized approach, the institution takes the design and development of the various IT solutions into its own hands. Thus, software is designed and developed in-house from scratch, with the help of the institution's own staff. Such an approach is motivated by the wish to avoid external dependencies. At the same time, however, a centralized approach places the entire [Page41:] burden of the IT developments on the institution, from design through to maintenance. This is the approach the ICC International Court of Arbitration has chosen to adopt in its NetCase project.

Alternatively, it is possible to follow a decentralized approach, whereby the provision of IT-solutions is left to independent providers that operate in a free market. Such providers would of course need to propose solutions that abide by the institution's rules. According to this approach there is a clear separation of concerns and a transparent division between legal and technical competencies, with the technical burden being taken off the shoulders of the institution. As a result, there would be five participants in the proceedings: claimant, respondent, arbitrator, institution and online arbitration provider. 24

Enforcement and coordination of standards of procedure

A second issue is whether or not to enforce special procedures for specific IT solutions. For example, an arbitral tribunal could require parties who have indicated their intention to conduct proceedings electronically to follow certain rules for storing and naming electronic files. 25 Or when parties have agreed to communicate by e-mail, they could be required to make printed records (hard copies) of their e-mails, and to manually acknowledge receipt to all e-mails received. 26 There may be a requirement to draw up special protocols to resolve technical issues relating to web site communications. 27 It should be remembered, however, that the parties' first concern is to settle their case, which is a legal matter, not a technical one. There is always a risk that the need to set technical standards might hamper the progress of the arbitration. Although it is true that standards may bring clarification and greater efficiency, it could be at the expense of time and energy that might otherwise be devoted to the proceedings themselves. The solution might be better sought in the structured storage of documents, 28 or left to each institution's information management system. It could also be argued that the interoperability of web-based solutions makes it unnecessary to stipulate operating standards for IT use. Such issues might indeed be better left to external providers.

Enforcement or coordination of standards of exchange

A third and final issue is closely related to the previous one, but narrows the problem down to whether it is necessary to enforce commitments on a certain standard of exchange. Here too, we would suggest that explicit commitments are not necessarily required. For example, there is no point in agreeing to use XML if there is no clear agreement on how the various XML documents will be structured. Again, such an issue could be left to external providers, which would then be responsible for the appropriate management of the documents according to the applicable rules. An ODR XML standard is under development, but considering the history of similar standards in other environments the success to be expected of such a standard can be doubted.

5. Concluding remarks

Technology already offers numerous opportunities for online arbitration, and this will be even more so in the future. It is important, however, that technological solutions should always be used on a voluntary basis. Parties must themselves be convinced of the advantages to be drawn from their use. In this connection, it [Page42:] may be noted that ICC's recent initiatives in this field - NetCase and the work of the Task Force on IT in Arbitration - both stress this voluntary nature of technology and Internet use.

The use of the Internet allows an arbitration procedure to be conducted more effectively, by offering access to case information at any time and from any place, by supporting both synchronous and asynchronous communication, and by allowing large volumes of files to be handled. Additionally, it is expected that videoconferencing will soon become a standard tool capable of greatly reducing travel time and expense. 29 Thus, from a technological point of view there will be virtually no restrictions to ODR practices.

Despite the wealth of possibilities offered by modern technology, one of the major challenges in the design of future ODR platforms will be to develop a technology that does not simply mimic offline practices. Colin Rule rightly observes: 30

When designing or choosing an online dispute resolution platform, it is important to think outside the box so that the tools selected are not merely copying offline practices.

One example is the use of argumentation to structure the exchange of information. 31 This means that the claimant and the respondent are put in a situation where they have to react to each other's contributions. For example, if the claimant states that the respondent delivered contaminated goods, then it is in the interest of the process, and ultimately in the interest of both parties, that the respondent takes note of the claim and responds to it. Such structures have been studied for quite some time in the field of formal argumentation, and a number of dialogue systems have successfully implemented this kind of argumentation, showing it to be viable. Of course, not all concepts are equally suitable for dispute resolution. Argumentation is primarily aimed at 'the desire to be right', while dispute resolution is solution-oriented.

The authors are currently experimenting with an ODR system called GearBi32 in which argumentation is a crucial component. It allows participants to mark (highlight) each other's contributions and respond to the marked phrases with a reply. Initial experiments have shown that this concept integrates well with the overall negotiation process as it articulates the needs of all parties at the proper places in the web environment. The experiments also suggest that the lessons learned in the area of formal argumentation are ready to be applied in the field of ODR.

Conceptual innovations such as that described above are just a moderate beginning. We believe that if developments of this kind are pursued, online arbitration will have a bright future ahead of it.

1
The purpose of CEDIRE, which began in the summer of 2003, is to conduct research and disseminate information on legal and technical issues regarding the use of technology in the courts and in alternative dispute resolution (negotiation, mediation, arbitration), <http://cedire.org>.

2
A. Narayanan & S. Hibbin, 'Can Animations be Safely used in Courts?' [2001:4] AI & Law 225.

3
A.R. Lodder & A. Oskamp, 'ICT-toepassingen in het strafrecht' in B.J. Koops, ed., ICT en strafrecht (The Hague: SDU, 2004) 215, and several examples in M. Fabri, 'Italy: practical perspective' in A.R. Lodder et al., eds., IT Support of the Judiciary in Europe (The Hague: SDU, 2001) 17.

4
M. Fabri & F. Contini, eds., Justice and Technology in Europe: How ICT is Changing the Judicial Business (The Hague: Kluwer Law International, 2001); A.R. Lodder et al., eds., IT Support of the Judiciary in Europe (The Hague: SDU, 2001); A. Oskamp et al., eds., IT Support of the Judiciary in Australia, Singapore, Venezuela, Norway, The Netherlands and Italy (TMC Asser Press/Cambridge University Press, 2004).

5
P. Leith, 'The UK: Practical Perspective' in A.R. Lodder et al., eds., supra note 4 at 55-68.

6
See <www.publictechnology.net>

7
Y.S. Thian, 'Singapore' in A. Oskamp et al., eds., supra note 4 at 45-70.

8
Courtroom 21, a project that started at the beginning of the 1990s; see F.I. Lederer, 'Technologically Augmented Litigation-Systematic Revolution' 5:3 Information & Communications Technology Law 215.

9
M. Philippe, 'NetCase: A New ICC Arbitration Facility', see hereinafter pp. 53ff.

10
cf. P12 of 'The Standards', hereinafter at 82.

11
M. Philippe, supra note 9.

12
For further information on Virtual Magistrate, see F. Gélinas, 'Taking Stock of ODR: From Concept to Business Reality', hereinabove at 8-9.

13
L. van der Wees, 'Internet@spam.Rechtbank' [1995:1] Computerrecht 44.

14
Spam still is a problem, see 'Explanatory Notes on the Standards', hereinafter at 108.

15
This can be done by a so-called forged cancel, which is generally accepted in case of spam.

16
In case of spam it could be argued that the very act of posting a message in a newsgroup implies acceptance of 'Netiquette'.

17
E.C. Anderson & T.S. Cole, 'The UDRP: A Model For Dispute Resolution in ECommerce?' (2002) 6 J. Small & Emerging Bus. L. 235; R.T. Mitchell, 'Resolving Domain Name-Trademark Disputes: A New System of Alternative Dispute Resolution is Needed in Cyberspace', (1998) 14 Ohio St. J. on Disp. Resol. 157. Very critical, B.G. Davis, 'Une magouille planetaire: The UDRP is an International Scam' (2002) 72 Miss L. J. 815.

18
One exception we know of is the WIPO arbitration of Dutch domain names, in effect since January 2003.

19
Article 18(a) UDRP.

20
It should be said that information on ODR activities is not always made known. One reason for this is the confidentiality of arbitration proceedings. Another may well be that such information would reveal that there have not been (that many) cases. We are sure this will change in time.

21
R. Hill, 'Online Arbitration: Issues and Solutions' (1999) 15 Arbitration International 199, <www.umass.edu/dispute/hill.htm>.

22
M. Philippe estimates it will take three to five years before procedures are conducted exclusively using electronic means; see M. Philippe, supra note 9 at 58. A.R. Lodder believes ODR will be the central method of dispute resolution in 10-15 years time - a prediction based on observations by D.A. Larson, 'Online Dispute Resolution: Do You Know Where Your Children Are?', Negotiation Journal (July 2003) 199, and E. Roelvink, 'The Future is Here', <www.emediation.nl>; see A.R. Lodder, 'De toekomst van geschillenoplossing: aandachtspunten en de onstuitbare opmars van ODR' [2004:16] Nederlands Juristenblad 832, <http://pubs.cli.vu/pub143.php>.

23
<www.resolvemydispute.com/> <http://arbiter.wipo.int/domains/> <www.onlineresolution.com>

24
For an interesting analysis of the different three party agreements or contracts involved in the case of mediation, see B. Yunis, 'Rechtsfragen der Online-Mediation' in O. Märker & M. Trénel, eds., Online-Mediation. Neue Medien in der Konfliktvermittlung - Mit Beispielen aus Politik und Wirtschaft (Berlin: Sigma, 2003) 201.

25
cf. P4-P8 of 'The Standards', hereinafter at 79-81.

26
cf. E5-E6 of 'The Standards', hereinafter at 83.

27
cf. section 3.3 of 'The Standards', hereinafter at 84-85.

28
See M. Philippe, supra note 9.

29
E. Schäfer, 'Videoconferencing in Arbitration' (2003) 14:1 ICC ICArb. Bull. 35.

30
C. Rule, Online Dispute Resolution for Businesses (San Francisco: Jossey-Bass, 2002) at 253.

31
A.R. Lodder & P.E.M. Huygen, 'eADR: A Simple Tool to Structure the Information Exchange between Parties in Online Alternative Dispute Resolution' in B. Verheij et al., eds., JURIX 2001 (IOS Press, 2001) 117; G.A.W. Vreeswijk, 'A Simple Scheme to Structure and Process the Information of Parties in Online Forms of Alternative Dispute Resolution', ADR Online Monthly (October 2003). See also G.A.W. Vreeswijk, Studies in Defeasible Argumentation, PhD thesis, Dept. of Mathematics and Computer Science, Vrije Universiteit, Amsterdam, 1993; A.R. Lodder. DiaLaw. On Legal Justification and Dialogical Models of Argumentation (Dordrecht: Kluwer Academic Publishers, 1999).

32
<http://www.cs.uu.nl/~gv/arbitration>