ONLINE DISPUTE RESOLUTION

Adarsh Srivastava

Faculty of Law, Integral University,

Lucknow

Tarun Lohani

Faculty of Law, Integral University,

Lucknow

Abstract:

Online Dispute Resolution (ODR) is a branch of dispute resolution that uses technology to
facilitate resolution of disputes between parties. It mainly involves negotiation, mediation or
arbitration, or a combination of all three. Traditional methods of dispute resolution (litigation,
arbitration or arbitration) in the offline world do not meet the needs of online users involved in
disputes over online transactions. In response to the demand for dispute resolution processes that
recognize the online user's desire for a fast and flexible mechanism.

The purpose of this paper is to present the main aspects of online dispute resolution, definition
of term, type of resolution available, and most recently Legal regulations in this area. This paper
is an in-depth study of this area, discussing online mediation and electronic mediation, their use
and their relationship with e-commerce.

This paper is divided into three parts. Part I defines the preliminary aspects of online dispute
resolution (ODR), including a definition of the term and the relationship between ODR and
technology. Part II is for examining the two most frequent forms of ODR: online mediation and
electronic arbitration. Part III is an analysis of consumer disputes arising from commercial
transactions made using electronic communications.

Keywords:- ODR, ADR, Justice, e-commerce.

Introduction
Online dispute resolution, here in after, (ODR) is a branch of dispute resolution which uses
technology to facilitate the resolution of disputes between parties. It primarily involves
negotiation, mediation or arbitration, or a combination of all three. ODR is conceived as a means
to achieve some of the most powerful legal ideals of the Western legal tradition, which include1:

(1) Legal Certainty: In making individual plans, decisions, and choices everyone is entitled
to know what the law is in advance.

(2) Access to Justice: Everyone involved in a dispute shall be entitled to an easily accessible
redress mechanism that provides for a timely resolution and effective remedies at reasonable
cost.

ODR is concerned with the civilized (i.e. peaceful) resolution of disputes between private parties,
and, secondly, with the prevention of such conflicts through the provision of legal certainty.
National legal systems fulfill the former function by offering plaintiffs to litigate disputes before
state courts which exercise mandatory jurisdiction over defendants, and the latter by making the
litigation process public, thus allowing for the proliferation of precedent, as well as by the
enactment of codifications of rules of law. Regarding the dispute resolution function of private
law, there are a variety of functional equivalents to litigation available, which are collectively
referred to as alternative dispute resolution (ADR). On the one hand ODR relates to the
resolution of disputes that result from online conduct, i.e. from communications and transactions
which come about through the use of the Internet Domain name disputes are a prominent
example as are disputes related to ecommerce. On the other hand, ODR relates to the use of
online communication technology in the resolution process, even if the dispute itself has an
offline origin. The provision of alternative dispute resolution (ADR) services on the Internet has
become quite popular. ODR in India is in its infancy stage and it is gaining prominence day by
day. By the enactment of Information Technology Act, 2000, e-commerce and e-governance
have been given a formal and legal recognition2. Human beings, when it comes to disputes
relating to money or status, are all the same, everywhere round the globe. Selfishness, strength of
money-power for protracting litigation or ego is common features. If the conciliation /mediation
solutions have been successful in other countries, they must and will succeed here also. Where
the problems are same, the solutions could be similar, though there may be differences in degree
or the methodology adopted. The procedure for conciliation/mediation are today part of the
systems of almost every judicial administration both in common law countries as well as in
countries governed by civil law systems.

1
Paul Breaux, Online Dispute Resolution: A Modern Alternative Dispute Resolution Approach, Computer and
Internet Lawyer 32(5), 1-4 (2015).
2
Lucille M. Ponte & Thomas D. Cavenagh, CyberJustice: Online Dispute Resolution (ODR) for E-commerce
Dispute resolution as always been considered as one of the most trickiest phenomenon for all
stakeholders which includes courts, government, companies, individuals, international
organizations, etc. This is where the contradicts takes place regarding law, because, the
happenings may arises where the disputes takes place among the individuals which may
belonged from different countries and as we know that law changes from place to place, which
means different countries have their different laws for dispute resolution. Therefore to reduce the
destitutions of such disputes, countries adopted a model code of conduct that was incorporated in
their respective domestic laws.

Notion of ADR:
Alternative Dispute Resolution; Also known as 'ADR'; Ways by which legal disputes and
disputes are resolved privately and through litigation in public courts, usually through one of two
forms: mediation or arbitration.

"Modern systems of alternative dispute resolution, commonly referred to as ADR, are designed
to help parties solve disputes efficiently without resort to formal litigation and with a minimum
of judicial interference."3

There are few forms of ADR also and those are as follows:

(1) NEGOTIATION:

In its simplest form, negotiation involves the exchange of ideas and when a dispute opposes
parties who wish to go out of court. Different from mediation or arbitration, negotiation does not
involve the intervention of any third party. Mutually acceptable resolution of the dispute is
entirely in the hands of parties. The negotiation process is confidential and completely voluntary;
In general, the parties can extract at any point. Negotiation is about communication and
Assumptions. Consequently, the negotiation has many of the factors discussed in conjunction
with dynamics are dependent on each other. Negotiation forms are; Conversation form, face-to-
face, written, telephonic or something technical form of ODR4.

(2) MEDIATION:

Mediation can be defined as a process by where two people agree to present their dispute to a
neutral third party, the arbitrator, who uses a variety of methods and techniques intended to guide
the parties toward an out-of-court settlement. The mediation process can also be collegial, in

3
By Hilmond, Hilmond Investments v CIBC, 1996, 135, DLR(4th ) 471
4
Noam Ebner, & John Zeleznikow, No Sheriff in Town: Governance for Online Dispute Resolution, Negotiation
Journal 32(4), 297-323 (2016)
other words, performed by multiple numbers of people. The mediation clause can also have a
restrictive effect when it is prerequisites that must be met to be admitted to a court of law or
arbitration5. The classical example of such a mediation clause is one which is the base
restrictions on a precondition that are particularly easy for a court to establish: Compliance with
a time limit. This type of contract mechanism creates a dispute inadmissible in the courts or
before the end of a cooling off period away from the courts or arbitration during which
contractual provisions commit the parties to use mediation. It can also be an increasing number
of business contracts can be seen.

(3) ARBITRATION:

Arbitration is a voluntary process in which disputed parties involve in the services of one or
more neutral third parties. This dispute resolution process is the highest proximity to litigation
because it is adjudicatory; arbitrator provides a final decision much the same way a judge entered
the final judgment of the trial in a suit. For example; In the case of mediation, arbitration is
sometimes very beneficial for the parties that are in conflict but still wish to pursue and maintain
their contractual relationship and concealment of proceedings. Parties can provide for recourse to
arbitration right when they sign the contract that unites them. This is done through an arbitration
clause such that all disputes arising out of their contractual relationship are subject to arbitration
in accordance with the conditions set out in the clause or in legislation. Of course, it is also
possible to provide for recourse to arbitration after the contract is signed using an adjunct, in
other words, an additional legal instrument modifying the initial contract. Finally, the parties can
also initiate the arbitration process after a dispute has arisen by signing an arbitral compromise,
but this rarely occurs because it is generally difficult to come to an agreement after a dispute has
occurred, even when what is at issue is how to resolve the dispute. In each of these cases, it will
no longer be possible to bring the dispute before the courts, except if there is a criminal offence
involved6.

ODR and Technology:

Dispute resolution techniques may vary from methods to methods where the parties have their
full dominance in the procedure, where third party is having a full control in both the process and
as well as with the outcome. These primary methods of resolving disputes may be complemented
with Information and Communication Technology (ICT)7. Therefore when the procedure
regarding solving of disputes takes place mainly with the online process it is referred as ODR,
i.e. to carry out the majority of the dispute resolution procedures online, including the initial
filing, the neutral appointment, evidentiary processes, online discussions, oral hearings may or

5
Concept of Online Dispute Resolution in India, Chitranjali Negi, Mewar University, SSRN-id2596267
6
Ibid, Concept of Online Dispute Resolution in India, Chitranjali Negi, Mewar University, SSRN-id2596267
7
Ethan Katsh & Orna Rabinovich-Einy, Digital Justice: Technology and the Internet of Disputes
may not needed as the case may be rendering and binding settlements. ODR was born from the
collaboration between ADR (alternative dispute resolution) and ICT, as a method for resolving
the disputes that were arising online, and for which the conventional means of dispute resolution
were became inefficient or unavailable8.

ODR nowadays constitutes its execution in the form of ADR which enables its use on the
internet. The main assumption of alternative methods of dispute resolution - namely, the
presence of a third party during the process of reaching an agreement - remains unchanged.
However, a different character is gained due to its use of modern forms of communication. So
there are indirect ways of presenting a request or evidence (Settle Today), as well as issuing a
decision at the end of the proceedings (WIPO)9 together with completing a full online process.
Each form of ODR can use a different technical system, varying the course of a given process.
Online Mediation can take a variety of forms; from fully automated Internet platforms using
electronic chat based portals Asynchronous form of communication, i.e. videoconferencing
(TheMediationRoom.com) for exclusive use. The first option constitutes a system related to
video meeting or online conversation (chat), during which prospects for dispute resolution is
analyzed with the arbitrator - a more direct form of ODR. The second option is used, for
example, in arbitration within the scope of arbitration obligations. Using a system of submitted
proposals, the parties agree on an amount which is acceptable to all parties without the need to
meet directly. Electronic arbitration, which refers to amicable proceedings via the Internet10, can
take either a Smart settle or asynchronous form (Settle Today).

Frequent forms of ODR:

There are two frequent forms of ODR which are as respectively:

1. Online Mediation:

Online Mediation is a widespread practice worldwide. It has the form of a standard face to face
mediation only it is assisted by technology and the synchronous or asynchronous communication
between the mediator and the parties. This way the resolution process manages to cross borders
and jurisdictions, creating significant advantages for parties that reside or established in different
locations. Online mediation requires specific mediation skills and adequate computer literacy.
The process is practical, low cost but has also been criticized for its inability to empathize and
reconcile between the parties. Some argue that online arbitration is no more or less than standard

8
Mohamed S. Abdel Wahab, Ethan M. Katsh, & Daniel Rainey, Online Dispute Resolution: Theory and Practice: A
Treatise on Technology and Dispute Resolution
9
Faye Fangfei Wang, Online Dispute Resolution: Technology, Management and Legal Practice from an
International Perspective.
10
Paul Breaux, Online Dispute Resolution: A Modern Alternative Dispute Resolution Approach, Computer and
Internet Lawyer 32(5), 1-4 (2015).
arbitration. This saves travel time and expenses. Parties can meet each other and intermediaries
on their smartphones on a computer screen or select only written electronic communication.
Whichever angle you look at it, online mediation is now more and more here because online
communication is part of our everyday lives.

To analyze the legal grounds for using online mediation, it is necessary to mention the rules
regarding the Alternative Dispute Resolution Methods. ODR steps to create freedom, security
and justice are correlated with the promotion of the ADR, with special reference to arbitration.
The Main Model Act on arbitration (excluding arbitration) includes a document published on 19
April 2002 by Commission of European Communities under the title "Green Paper" on Civil and
Commercial Law ". Its main purpose was" to initiate broad-based consultation of those involved
in a certain number of legal issues raised in connection with alternative dispute resolution in civil
and commercial law”. The literature on this subject describes two meanings of the term "online
mediation" - the first place in which a legal relationship was created for the dispute, and second
was the basis for an online tool used to resolve the dispute, Regardless of its place of
manufacture11.

A specific model for the process of online mediation begins when an email is sent to the original
parties with the information on proceedings. Virtual meetings are held in so-called "chat rooms",
which contain virtual versions of meeting rooms. These proceedings in chat rooms either can be
carried out separately or, while having both the parties together. Electronic equipment is the
classic form of ODR is used for communication purposes and enables increased flexibility due to
being virtual. Mediation sometimes becomes an electronic conversation and vice versa. Online
mediation usually conducted through text-based communication, and real-time meetings - such
as teleconferences - are more frequent hardly ever.

(2) Electronic Arbitration:

Electronic arbitration can be defined as arbitration in which all aspects of the proceedings are
conducted online. Hearing can take place through the use of video conferencing in online
arbitration, but most online arbitrators simply require the parties to upload their blank
documents, answer questions from the arbitrator and they will receive a decision from the
arbitrator. Online arbitration shares many of the same benefits as online arbitration, such as
lower costs and greater flexibility due to their asynchronous nature. Disadvantages of online
arbitration not having face-to-face interactions are also less important because mediation relies
less on the negotiation of the parties, but more on clearly written presentations.

Online arbitration is widely used for Internet domain name disputes and can be legally binding or
non-binding in nature. Internet domain name disputes are usually governed by the Internet

11
Available at, http://arbitrationblog.kluwerarbitration.com/2018/03/29/online-dispute-resolution-future-
alternative-dispute-resolution/
Corporation ("ICANN") Uniform Domain Name Dispute Resolution Policy ("UDRP")12 for
assigned names and numbers. The World Intellectual Property Organization13 ("WIPO") is one
of the UDRP dispute resolution service providers that administers the UDRP administrative
process for domain name disputes and is responsible for appointing panelists to determine the
dispute. Decisions made under the UDRP administrative process are non-binding but still highly
effective. This is because while these decisions are not binding on the parties, it is binding on the
domain name provider, which will then affect the changes set by the panelists. While parties
have admitted to litigation if they are dissatisfied with the decision, it is rarely done because
expensive and time-consuming cross-border litigation is unlikely to be justified by the value of
the domain name.

Online arbitration is also used in business for consumer disputes. However, it is not generally
unpopular because it is a poor medium for dispute resolution, but because consumers see
arbitration agreements that deny access to justice through the courts and, in particular, class
action suits which will offer more compensation.

ODR in Consumer Disputes:

Alternative Dispute Resolution (Amendment) Regulations for Consumer Disputes 2015,
(Regulations) launched in Britain, European Commission online dispute resolution platform
(ODR platform). Importance of an effective single digital market, European Union Commission
set up online dispute resolution platform common, easy and strategic interface for resolving
disputes between consumers and European Union traders. Thus, the ODR platform enables
settlement of disputes. Cross-border in nature and thus regulate the market with less
jurisdictional conflict issues14.

 The ODR platform caters for marketing and exchange between consumers and merchants
and is a ready interactive, multilingual platform to assist consumers to drop complaints
Goods or services that are purchased online. Agreement to adopt ODR methods,
Consumers or traders are required to complete an electronic complaint form available on
ODR platform. The parties are free to choose any ADR unit. ADR units are entities that

12
See also, Available at, http://odrindia.in/
13
The costs of arbitration proceedings before the WIPO Center depend on the size of the claim and additional
factors such as the number of disputed Internet domains or composition of the panel. For example, total costs for
proceedings on a claim that does not exceed $2,500,000.00 comprise a registration fee of $2000.00, an
administration fee of $2000.00, and remuneration for the arbiters, depending on the hours of work. A cost
calculator is available at the official website of the WIPO Center.
14
Online Dispute Resolution (ODR) Services for National and International Stakeholders Launched by TLCEODRI,
TLCEODRI, July 31, 2015, available at http://odrindia.in/?p=37.
 meet the binding quality requirements ADR Directive and which are included in the
national list of ADR bodies15.
 When dealing with buying and selling at across the country, traders and consumers need
it know the existence of ODR platform. Really need to spread awareness among
merchants and consumers who deal in online contracts, sell that easy dispute settlement
methods are available such as ODR platforms16.

In brief, if a consumer makes a complaint via the ODR Platform, the procedure will be as

Follows:

 The consumer will fill in an online complaint form;

 The complaint will be sent to the trader;
 If the trader agrees to engage in the ADR process, the trader will select an ADR
Provider;
 If the consumer agrees on the ADR provider selected to handle the dispute, the ODR
 Platform automatically transfers the dispute to that provider;
 The ADR provider handles the case entirely online and reaches an outcome in 90
Days17.

Future of ODR in India:

ODR and online mediation are of great importance. The current world, where technology drives
almost every moment of our lives. Internet connection that forms the backbone of any online
arbitration. Unequal Replication on technical connectivity in India gives a response online
arbitration. Also, people are slow to understand that an organized Online portal / medium is not
less effective than face to face resolution of dispute interaction between the parties. However, the
theoretical aspects are practically ignored. The approach gives a sense that sudden imposition is
difficult, emphasizing online mediation or ODR mechanism on Indian population for its
tremendous tolerant sufferings, disbelief and lack of confidence in such dispute resolution
mechanisms. Although online arbitration is most commonly used to resolve disputes between e-
commerce, Business to Consumer (B2C)18 controversy but there are some developing countries

15
Colin Rule, Online Dispute Resolution for Business: B2B, E-commerce, Consumer, Employment, Insurance, and
Other Commercial Conflicts (1st ed. San Francisco: Jossey-Bass 2002).
16
Amy Schmitz & Colin Rule, The New Handshake: Online Dispute Resolution and the Future of Consumer
Protection.
17
The New ODR Platform: Time For Online Traders To Re-Think Their Strategy For Dealing With Customer
Complaints? 15th February 2016, available at http://www.bpe.co.uk/why-bpe/blog/2016/02/the-new-odr-
platformtime-for-online-traders-to-re-think-their-strategy-for-dealing-with-customer-complaints/.
18
Colin Rule, Online Dispute Resolution for Business: B2B, E-commerce, Consumer, Employment, Insurance, and
Other Commercial Conflicts (1st ed.)
where individuals often engage in online businesses and thus a cordial solution is needed. For
example, India engages in a lot of online transactions but the number of online users is less as
compared to the population of the country. In such a situation, technical readiness is important
to help those who achieve online disputes took place. Despite all the obstacles, the ODR is
slowly spreading and an infant is still recognized in India. Legislative efforts on e-governance
and e-commerce; In addition to the emphasis on mediation through mediation and Conciliation
Act, 1996; Reflect a lot on changing patterns of dispute resolution in India. Online arbitration
may present several difficulties but in essence it is not different compared to normal arbitration.
Entering into arbitration agreements in certain online settings that may conflict with the core
principle of international arbitration law the consent of the parties is a condition sign
qualification that is unlawful to agree on arbitration. In some situations the parties may state that
they have not read the agreement carefully before accepting it with a click of the mouse.
However, if online there should be no reason when the arbitration agreement is carefully drafted.
Arbitrators arising from such proceedings deny the award19.

Against the backdrop of Digital India, the government should aim to streamline the online
dispute. The resolution mechanism is grappling with all technical and educational hurdles. It can
only help in pending litigation in High Courts. Developed responsibility countries will hope to
facilitate ODR mechanism in developing countries significant changes in the online arbitration
environment. Thus, the lack of loss there is trust and confidence among people with whom India
and other developing countries is the curtain can be lifted by reeling. Over time, India will
certainly adopt online arbitration and has already set out on the course to get it. Technical Legal
Center as far as ODR is concerned excellence for Online Dispute Resolution in India
(TLCEODRI) has launched a beta version ODR platform that can be used by national and
international stakeholders for dispute resolution uniformly20. Globally, there are two approaches
adopted by disputants for ODRs: (a) non-judicial ADRs, which focus on negotiation and
mediation; and (b) arbitration, which is court currently the Indian National Internet Exchange
("NIXI") uses only the other the access.

Conclusion:
Integral features of traditional ADR mechanisms such as fairness, transparency dispute
resolution, neutralizing power imbalance between parties ODR can also be incorporated into the
system. This is the similarity between the two methods tries to get individuals to adopt this more
effective and reliable method of dispute resolution, mainly in the e-commerce business. When

19
A. Broches, Commentary on the UNCITRAL Model Law on International Commercial Arbitration (Deventer:
Kluwer, 1990) at 38; J. Coe, International Commercial Arbitration: American Principles and Practice in a Global
Context (New York: Transnational Juris, 1997) at 55; B. Poznanski, “The Nature and Extent of Arbitration Powers
in International Commercial Arbitration” (1987) 4 J. Int‟l Arb. 71 at 71; A. van den Berg, The New York Convention
of 1958: Towards a Uniform Judicial Interpretation (Antwerp: Kluwer, 1981) at 173.
20
Online Dispute Resolution (ODR) Services for National and International Stakeholders Launched by TLCEODRI,
TLCEODRI, July 31, 2015, available at http://odrindia.in/?p=37.
ODR is a successful method combination of multiple factors drive interested parties to achieve
desired results. They are creating confidence in the parties to resort to such method, the correct
identification of interests, strategic computational skills, fact finding, and design of solutions,
monitoring and building agreements on experiences. Historical use of e-bay and ICANN
indicates that the use of the web instead of email as the medium of communication and
participation is a better option. ODR is not limited to meet disputes outside online activities only,
but also beyond. However the ODR has been accepted and no more adopted as a test and
experimental platform for dispute resolution. The seriousness of adopting the system will only
increase when more awareness and institutional development takes place by its stakeholders.

ODR can serve as an efficient means of dispute resolution in cyberspace. This is a common thing
the belief that ODR may initially be successful in resolving disputes related to small claims as
opposed to high stake cases, as the parties always prefer to enter into arbitration and presentation
of oral arguments in physical hearings in high stake cases. Mentality of people will change when
the ODR process is streamlined along the route of time and initialization the reluctance to use
ODR will go away. For an ODR system to prove more practical and litigation of a party is
possible, it needs to provide greater access to technology, different from infrastructure,
affordability and convenience of use, flexibility, transparency adequate security, fairness,
expertise and legal enforcement mechanisms. Hence, dissemination of ODR practices will
involve spreading public, private awareness bringing necessary changes in partnership, IT
training and education, legal framework work, and to the extent possible, the development of an
internationally accepted body of cores a basic principle for ODR Practices and Principles of
Procedural Law. Thus, ODR holds play a role in creating efficient governance for dispute
resolution using information to promote the development of technology and e-commerce! ODR
is also a beacon of light indicates development towards the development of a uniform cyber law
establishment of Lax Moratoria. This process also shows how traditional barriers are differences
in traditional regulatory systems, socio-cultural, legal and psychological the sheer power of
technology makes the approach flawed! It is so the power of technology but if it is put to right
use.