The advent of the 21st century has seen immense modernization in every sector and segment of society. Law and justice being an integral part of our modern society also need to adopt a dynamic approach to survive and serve the rising population of our country.
What is Alternative Dispute Resolution (ADR)?
The dynamic approach gave rise to the concept of Alternative Dispute Resolution systems. Alternative dispute resolution (ADR)[1] refers to a range of practices and strategies that allow legal issues to be resolved outside of the courts. It is commonly understood to include mediation, arbitration, and a variety of "hybrid" systems in which a neutral assists the resolution of legal disputes without formal adjudication. These alternatives to adjudication are promoted for a variety of reasons.
Benefits of ADR
Potential benefits include lower transaction costs for dispute resolution because ADR processes may be cheaper and faster than traditional judicial proceedings; the creation of resolutions that are better suited to the parties' underlying interests and needs; and improved ex-post compliance with the resolution's terms. In recent years, a large number of people and legal[2] professionals have largely recognized it as a strategy or methodology for resolving disputes. Involving technology in the ADR makes it more accessible and allows disposing of cases easily. Technological advancements need to be adopted to be at par with the rapid race of development. The dynamic environment includes negative situations as well. Negative situations like the Covid-19 pandemic.
Origin of Online Dispute Resolution (ODR)
Online Dispute Resolution ("ODR") is a type of alternative dispute resolution that uses modern communication technologies like video conferencing, e-mail, and messaging apps to resolve disputes without requiring parties to be physically present. Online Dispute Resolution (ODR) is defined as "a broad class of alternative dispute resolution processes that take advantage of the availability and continued development of internet technology.” This market grew in popularity, especially when the pandemic affected sectors and increased the need for digital services. The Reserve Bank of India (RBI) implemented ODR to resolve customer complaints and disputes linked to digital payments.
Relevance in Debt Recovery Disputes
There have been several advantages of Online Dispute Resolution, especially in the field of debt recovery. The keys to efficient ODR implementation are data, artificial intelligence, and integration with other digital services. If the matter is not settled, the parties might choose another means of dispute resolution[3]. Many parts of the debt recovery process can be automated with little or little manual intervention, reducing manual effort and speeding up turnaround times. In the most advanced stages of technology, the lender's litigation team can identify future clients who default on their payments and inform firms of the risk, allowing them to take action quickly via ODR.
Efforts of the Government of India
The Covid-19 pandemic resulted in a large section of society being unable to receive timely access to justice. The pandemic also led to a deluge of disputes further burdening the already lengthy court processes. All these resulted in the development and introduction of a new era of legal by the premier policy think tank of the Government of India, NITI Aayog. They undertook a transformative initiative to use technology and innovation to help bring affordable, effective, and timely justice to those who needed it the most. Online Dispute Resolution[4] has the potential to help reduce the burden on the court and efficiently resolve several categories of cases.
Legal Framework
A variety of supporting legislations address the ADR and technical aspects of Online Dispute Resolution. The Arbitration and Conciliation Act of 1996 is the authoritative Indian statute which contains all necessary regulations w.r.t ADR mechanisms in India. Section 89 of the Code of Civil Procedure of 1908 the Code grants the court the authority to refer cases to either arbitration or mediation/conciliation or Lok Adaklat initiatives. Further, Section 12A of the Commercial Courts Act, 2015, introduced pre-litigation mediation in India. Section 442 of the Companies Act, 2013, states that a panel of experts called the 'Mediation and Conciliation Panel' must be maintained by the Central Government. In section 74 of the Consumer Protection Act, 2019, consumers are facilitated with broad base mediation through the establishment of 'Consumer Mediation Cells' in every district. Further, the Consumer Protection Act (E-Commerce) Rules, 2020, has set the foundation of Online Dispute Resolution by mandating e-commerce entities to develop internal grievance redressal mechanisms. The Information and Technology Act, of 2000, comes into play for the technical aspect of ODR. Electronic records and signatures are recognized by sections 4 and 5 of the enactment[5].
Conclusion
Although ADR aims for rapid disposal of matters, it requires aid when it comes to challenging situations like Covid-19. Fast disposal along with easy accessibility makes the process of Dispute Resolution impeccable, which is further guarded by a plethora of legal statutes. All these shall make the dispute resolution system stronger.
[1] Mnookin, Robert, "Alternative Dispute Resolution" (1998). Harvard Law School John M. Olin Center for Law, Economics and Business Discussion Paper Series. Paper 232. http://lsr.nellco.org/harvard_olin/232 [2] Homepage: LSC - Legal Services Corporation: America's partner for Equal Justice. LSC. (n.d.). Retrieved April 18, 2023, from https://www.lsc.gov/ [3] Credgenics (2023) Expediting debt settlements using the Online Dispute Resolution Framework, Credgenics Blogs. Available at: https://blog.credgenics.com/online-dispute-resolution/#:~:text=Advantages%20of%20ODR%20in%20debt%20recovery&text=It%20facilitates%20dispute%20resolution%20by,a%20different%20mode%20of%20resolution. (Accessed: April 18, 2023).b [4] How it works? BDR, https://www.bharatdispute.com/get-your-clause (last visited Apr 18, 2023) [5] Shakti Bhog Foods Ltd v. Kola Shipping Ltd 08 Civ. 8817 (GEL) (S.D.N.Y. Feb. 24, 2009)
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