Using digital means to solve legal disputes from a startup perspective

Online Dispute Resolution mechanism (ODR) gives an opportunity to address issues faced in the conventional dispute resolution mechanisms in India.

When it comes to ease of doing business, ODR grabs attention particularly, for its parameter on access to justice as it is considered to be a game-changing transformation in the justice delivery framework.

ODR is often understood as an electronic medium of alternate dispute resolution mechanism (e-ADR), involving arbitration, mediation, and conciliation through the internet and other web-based technology using ways such as telecommunications, computer technology, and audio-visual technology.

ODR is recognized worldwide nowadays. In India, it received impetus from the government, businesses, and judiciary both as an extension of the public court system through court-annexed ODR and otherwise through legaltech startups. In the current day and age, it has become unavoidable particularly in a post-pandemic world.

Understanding the framework

To date, there isn't a specific legislation on ODR in India. Though Indian Evidence Act 1872 and Information Technology Act 2000 provide recognition of digital evidence and electronic signatures respectively. Besides, few departments and ministries adopted a digital mechanism to resolve disputes like the e-courts mission, e-lok adalats, samadhaan portal by the Ministry of Micro, Small and Medium Enterprises, and ODR policy of the Reserve Bank of India for digital payments.

Additionally, NITI Aayog released a report titled “Designing the Future of Dispute Resolution: The ODR Policy Plan for India,” to scale dispute avoidance, containment, and resolution online. These developments—while minuscule by nature— show a systematic and phased effort toward promoting ODR in India.

Working in the private sector

Promotion of ODR in India led to early innovation and adoption of technology by the private sector which involves many key players, including startups who provide these ODR services, dispute resolution centers, and professionals who adopt technology tools in the services for resolving disputes arising in the course of business. As a mechanism, it received a breakthrough in 2019 when an E-ADR challenge was organized by ICICI Bank in collaboration with Agami, a non-profit organization, to identify startups solving millions of disputes online.

Besides, the Department of Legal Affairs sought proposals from institutes providing ADR/ODR services to host a list of service providers on its website. Further, due to the increase in technology and digital economy, businesses across digital economy and traditional industries are keen on integrating technology into the dispute resolution process.

Such legal-tech start-ups dealing with ODR can support the legal system for the affordable, accessible, efficient, and convenient legal and judicial system. Moreover, Government incentives to these startups will encourage further growth of ODR in India.

A few notable start-ups include Jupitice, SAMA, Agami, Presolv360, JustAct, and Centre for Alternative Dispute Resolution Excellence. Few startups provide an integrated cloud-based platform, end-to-end dispute management software, and ERP software, while others provide software as a service or provide legal services by combining technology and professional expertise.

Examples of ODR services for startups

Modria

It is an online conflict resolution tool that provides a neutral, safe, and quick way to resolve online disputes. Modria offers a number of services, including mediation, arbitration, and negotiation, to help entrepreneurs resolve conflicts expediently and cost-effectively.

Smartsettle

It is an artificial intelligence-powered dispute resolution platform that uses algorithms to discover the best solution to a dispute. It offers a wide range of services, including online negotiation, mediation, and arbitration, and can be used to resolve issues between startups and their customers, suppliers, or partners.

FairClaims

It is an online arbitration platform that allows entrepreneurs to resolve issues without going to court. It provides a user-friendly forum for parties to present their case and effectively resolves conflicts.

CAMP Arbitration and Mediation Practice

It is an India-based online dispute resolution service that provides arbitration and mediation to businesses and startups. The platform is simple to use and provides a transparent and efficient dispute resolution system.

Challenges in the ODR Framework

Establishing a robust ODR framework is not without its challenges. Breach of confidentiality, lack of robust data protection laws, tampering of digital evidence, and absence of online notarization of documents, are among them.

Additionally, digital literacy, access to internet infrastructure, and cyber security are also required to make this process effective. There is also a need to increase the number of trained ODR professionals in India while also providing scope for their regular upskilling with the advancement of technology. It is pertinent to prioritize and tackle these challenges as a prerequisite for ODR in India.

Although the ODR is still at a nascent stage, the existing framework is promising. Chief Justice DY Chandrachud recently said, “Online Dispute Resolution has the potential to decentralize, diversify, democratize and disentangle the justice delivery mechanism for the citizens in India.” T

This is the right time for India to move towards the beneficial integration of technology with the dispute resolution process through ODR to transform the justice delivery framework.

Sowmya M has over 14 years of experience in the legal profession. She has worked extensively in the areas of corporate advisory, transaction, litigation, arbitration, and real estate transactions.

Abhilasha S G, Associate, King Stubb and Kasiva, focuses on corporate laws, commercial law, and regulatory issues for various clients. She handles a diverse set of clients, working primarily with companies involved in manufacturing, service, IT, and government.