Is there potential for technology to play a role in improving access to the Civil Justice system?
From April to June 2016, 397,054 civil claims were issued in England and Wales (Ministry of Justice, 2016, p. 6) of which 12,109 went to trial out of the 69,968 contested claims (Ministry of Justice, 2016, p. 8). By contrast, eBay’s Dispute Resolution Centre (EDRC) resolves approximately 60 million cases annually (ODR Advisory Group, 2015, p. 5). With this in mind, is it time for the UK Civil Justice system to be subjected to technological advances or is it more just to focus on quality and tradition over speed and quantity? Is it possible to find a happy medium between the two?
Civil disputes cover a considerable range of issues including non-payments of debts, breach of contract, and personal injury. There were around 1.6 million of such claims brought in the civil courts in 2014, with the large majority of these claims going undefended and only 14.7% of claims being defended (Ministry of Justice, 2015). A ‘small claim’ in the civil courts refers to any claim under the value of £10,000. Currently, a small claim that is presented in England and Wales takes around 31.7 weeks to reach court once it is submitted (Ministry of Justice, 2016, p. 9). Depending on the size of the claim, it currently costs anywhere between £35 to £455 to bring such a claim (Ministry of Justice, 2016), and hearings usually take around 1 hour to be decided once they do reach court. With an austerity drive being implemented by the government since 2010, funding for the justice system has fallen by 34.1% since 2010-11 (Institute for Fiscal Studies, 2015). Consequently, considerable strain has been put upon the civil justice system: it is now expected to do more with less money by implementing creative solutions offered by technological developments. These developments constitute both a great opportunity and a challenge to policy makers as they need to seek efficiency without sacrificing quality.
One such development is Online Dispute Resolution (ODR). This is defined as ‘a form of online settlement that uses methods of alternative dispute resolution (ADR) such as mediation and arbitration, and covers disputes that are partially or fully settled over the internet’ (Mania, 2015). The main assumption in ADR is the presence of a third party who is impartial to the dispute and whose aim is to assist the disputing parties in coming to an agreement or in determining an agreement from the facts of the dispute where required. ODR takes ADR and combines it with technology in order to offer flexibility and speed to the proceedings. It does this by using either synchronous, real-time methods - such as Skype or Messenger - or asynchronous methods - such as email - to progress the dispute to a resolution. The European Regulation on ODR, Regulation (EU) 524/2013, which came into effect in January 2016, obliges the European Commission and Member States to establish ODR to facilitate communication in disputes between consumers and traders, requiring all EU-based online businesses to offer an online platform to resolve consumer disputes. Any online platform must be compliant with the spirit of Regulation 524/2013 and must encourage disputes to be resolved before they are litigated. In the present political environment and the oncoming process of Brexit, this regulation will be one of many aspects considered as the UK withdraws from the European Union. The question remains whether this will be one of many regulations that the UK government would need to seek regulatory equivalence to maintain satisfactory trading access with the EU and its member states.
The most notable example of ODR, which many of us may have experience with, is the eBay Dispute Resolution Centre (EDRC). This resolves around 60 million consumer disputes between buyers and sellers per year on aspects ranging from non-payment by buyers and misrepresentation of goods by sellers to potentially defamatory feedback. EDRC involves a straightforward two stage process for transactional related disputes. The first stage involves encouraging the parties to resolve the matter themselves via online negotiations. If this fails, then the claim is escalated to eBay. The claim must be brought within 30 days from the actual or latest estimated delivery date (ODR Advisory Group, 2015, p. 12), and no earlier than 8 days after the dispute was first raised with the seller in order to encourage negotiation. Once escalated to eBay, a member of the EDRC will adjudicate on the dispute and deliver a verdict within 48 hours, which usually results in a refund to the buyer under eBay’s Money Back Guarantee (EBay, 2016). In relation to feedback disputes, the process differs; disputes are handled by independent company Net Neutrals who adjudicate upon electronically submitted evidence with verdicts delivered within seven days. One of the eBay’s Dutch subsidiaries, Marketplaats, uses a juror-based model for handling feedback disputes, thus feeding into one of the great judicial principles of being tried by your peers.
There are some other notable examples of ODR in the UK, such as the Financial Ombudsmen Service (FOS) and the Traffic Penalty Tribunal (TPT). The FOS deals with disputes between consumers and UK financial services providers and works based on the principle that disputes are resolved at the earliest opportunity and always within 8 weeks. The first stage involves adjudicators facilitating discussion between the parties to enable them to resolve the dispute themselves, then with the adjudicator offering their determination if early discussions fail. It should be noted that this determination is not binding on either party, but is often sufficiently influential to end the dispute. The first stage is successful in resolving around 90% of disputes. If either party rejects the adjudicator’s determination, then the case is put before an Ombudsman for final, binding determination. In 2013/14, only 6% (31,029) of 518,778 cases referred to FOS went to the Ombudsman (ODR Advisory Group, 2015, p. 13), and all but 20 cases were resolved without the requirement of a face-to-face meeting, highlighting the efficient, speedy and seemingly fair nature of the process. The TPT in England and Wales recently launched a web-based portal called BECK (Best Evidence Cloud Knowledge) which allows appellants, authorities and adjudicators to manage all aspects of a case via an online dashboard. It allows them to submit evidence to appeal and to follow the case progress on one screen, with notifications sent to appellants via email as the hearings progress. BECK has allowed TPT administrators to place more focus on their customer service rather than their case management, as there is an expected 30% increase in workload with no commensurate increase in staffing levels (ODR Advisory Group, 2015, p. 16). This is an excellent example of the ways in which the justice system can thrive with fewer resources.
The Civil Justice Council’s ODR Advisory Group recently published a report that argued for a radical rethinking of the civil justice system’s traditional approach to managing disputes. It suggests that civil justice is divided under three headings; dispute resolution, dispute containment and dispute avoidance. It also argues that the system traditionally places too much emphasis upon dispute resolution via the courts, and not enough on dispute avoidance or containment via mediation or arbitration. Changing this emphasis to focussing upon dispute avoidance and containment could decrease the amount of cases that reach courts and reduce the pressure on the court system, using the analogy of providing a fence at the top of a cliff, rather than an ambulance at the bottom of it (ODR Advisory Group, 2015, p. 17).
This radical proposal suggests the introduction of a 3-tiered online court system (HMOC). Tier one would involve the online evaluation of a claim to help users evaluate the legal basis of their claims using an automated diagnostic service. This service would be free at the point of use, effectively establishing an automated pro bono service. This would help users assess their claims from a legal perspective by providing quick and free advice. It is also expected that this should help users to avoid many minor issues escalating into larger legal problems.
Tier two would involve an online facilitation with trained online facilitators who aim to encourage, mediate and advise parties to contain disputes before they reach the courts (virtual or physical). Online facilitators would work on a very similar basis to FOS Adjudicators in that their recommendations would not be legally binding but would be considered influential. The ODR Advisory Group predicts that this stage should have similar success rate in early resolution to the FOS system (around 90%). Any cases not resolved at tier two would then progress onto tier three, which is an online hearing before a judge.
Tier three cases would then follow a similar adversarial system of the traditional courtroom, with cases being heard by an online judge who works on a part-time or a full-time basis. Arguments would be submitted to them electronically with the same adversarial style of pleading an argument. As with traditional courts, the judge’s decision would be as legally binding and enforceable as in physical courts, with the same rights of appeal. The ODR Advisory Group also proposes that an online judge should have the ability to refer cases back to the traditional system if there are legal issues that require greater consideration, or where the credibility of witnesses is of critical importance to the case being heard (ODR Advisory Group, 2015, p. 21).
On the one hand, this proposal offers many improvements to the current system, such as affordability, accessibility, greater ease of use, speed, and proportionality. On the other hand, there are concerns that the new system could be more impersonal and could break the emotional link between the justice system and its users. The new system might also impose potential limitations on the remedies available, due to the type of cases that it would be able to hear. The remedies involved would likely be limited to, but not exclusively, damages or the rescission of contract. Such an EDRC style system would suit low-value, high-volume consumer disputes, and would allow the courts to deal with complex high-value cases more quickly and efficiently.
Small Claims Mediation Service
A pilot ODR system was launched in 2005 by the Department for Constitutional Affairs (now Ministry of Justice) as an attempt to find cheaper and more efficient ways of handling low-value cases. The Small Claims Mediation Service (SCMS) handles all small claims except personal injury, road traffic and housing disrepair cases where both parties agree to use the online service. If there is no agreement between the parties on the use of the online service, cases are recommended for mediation by a judge. In addition to this, HMCTS now employs 17 mediators as part of a free nationwide service to parties involved in small claims disputes. Small claims cases are now automatically referred to mediation if agreeable to both parties. Between April to October 2014, it was estimated that these initiatives saved approximately 6170 hours of judicial time, and successful mediation reduced settlement periods to around 20 weeks from the present average of around 32 weeks (ODR Advisory Group, 2015, p. 22), highlighting the potential of such systems. If this can be successfully rolled out and implemented, (which is not necessarily guaranteed given the history of many public sector IT projects) it has vast potential for savings as demonstrated above.
What effect would the proposal have upon the legal profession? There are some concerns that this could create a two-tier justice system with a business class and an economy class option, depending on a claimant’s wealth. Although this is a valid point, the alternative to the status-quo is less palatable to many due to the cost, lack of speed and inaccessibility. Together with the reforms of personal injury small claims limits, this may have a negative impact on some high-street firms which deal with a significant amount of such cases. They may have to adjust their business model as a result of these changes, with a larger focus towards mediation-style services.
Overall, the above-mentioned arguments suggest that the proposal to introduce a simpler and cheaper HMOC has the potential to revolutionise the civil justice system in England and Wales by opening up the service to more people. The increased accessibility and transparency that HMOC could provide may help to increase confidence in the justice system at a time where some perceive it to be under threat of financial and social pressures. The flexibility of the arrangements will also help to encourage retention of members of the judiciary through more flexible working conditions. It seems these proposals offer both challenges and opportunities to the legal profession, which exists to help justice be done and be seen to be done for those who require it. The ability to fairly, speedily, and justly hear the sorts of low-value, simple claims must not be treated as a forgotten part of the justice system, as it can have far-reaching effects on the law and society. Let us not forget that the modern law of negligence was founded from a small consumer action involving a snail in a bottle of ginger beer (Donoghue v Stevenson anyone?).
eBay. (2016, December 28). eBay Money Back Guarantee. Retrieved from eBay: http://pages.ebay.co.uk/ebay-money-back-guarantee/
Institute for Fiscal Studies. (2015, October 1st). Recent cuts to public spending . Retrieved from ifs.org.uk: https://www.ifs.org.uk/tools_and_resources/fiscal_facts/public_spending_survey/cuts_to_public_spending
Mania, K. (2015). Online Dispute Resolution: The future of justice. International Compararive Jurisprudence, 76-86.
Ministry of Justice. (2016). Civil Justice Statistics Quarterly, England and Wales, April to June 2016. London: Ministry of Justice.
Ministry of Justice. (2016, December 28). Make a court claim for money - Court Fees. Retrieved from www.gov.uk: https://www.gov.uk/make-court-claim-for-money/court-fees
ODR Advisory Group. (2015). ONLINE DISPUTE RESOLUTION FOR LOW VALUE CIVIL CLAIMS. London: Civil Justice Council.