Virtual Arbitration – A promising future

The pandemic has changed perceptions in all aspects of life and with multiple and prolonged Covid lockdowns, even the most reluctant and IT phobic disputes lawyer had to face the dawn of virtual hearings. The duration of governmental lockdown measures, particularly in the UK and Europe, combined with restrictions on international travel, have forced the use of virtual, or semi-virtual, hearings instead of hearings in person, not only in arbitration, but also in litigation.

Now that the world is learning to live with Covid and is opening up again, with travel being possible (albeit not in every corner of the globe, and with less reliability than was hitherto the case), there is one school of thought that we should revert to the norm of fully physical hearings. There is another school of thought, which is that, to some degree or other, having in mind the climate crisis, and an imminent economic crisis across the globe, we ought to continue to carry out hearings virtually – or at least semi virtually.

Indeed, there are plenty of statistics showing – and it should come as no surprise - that arbitration hearings require an obscene amount of resources, whilst confirming that virtual hearings are significantly less carbon-intensive and cheaper for arbitration parties than in-person hearings. Lawyers need to ask themselves the question: “How often do I actually need to travel to see the clients, witnesses etc., and do the benefits of attending a hearing in person, really outweigh the costs?” The hearing bill can be significantly reduced by eliminating travel and accommodation costs and without physical bundles, including the logistics of providing and updating those bundles, the parties can save hefty photocopying costs and avoid the use of an extensive amount of paper of often thousands of pages.

Whichever viewpoint prevails, one argument against virtual hearings that was often raised before the pandemic, namely that they are too difficult to organise technically or logistically, has fallen away due to the fact that virtual hearings have now become an integral part of conducting disputes. 

However, particularly in relation to interim hearings, it was already common to see the directions hearings being held remotely by tele-conferencing even before the pandemic. Now, virtual hearings have often led to better interaction, as, historically, many of these took place by phone, and now they are likely to take place by video. It is the author’s view that directions hearings and generally smaller hearings will continue to be virtual, but the big question is the extent to which longer evidential or merits hearings will take place virtually or semi virtually.

There are counsel and indeed tribunal members, who feel that the process benefits both from seeing witnesses (and counsel) in person, and from the opportunity for tribunal members to confer physically, in and around the hearing. There are also stakeholders who enjoy the ‘international’ piece of international arbitration. These are certainly issues that need to be addressed but should not stand in the way of innovation.

Legal practitioners and their clients need to be aware that the transitioning from in-person to fully virtual, or hybrid, hearings will not be a smooth one, but with experience, virtual hearings are not only achievable but also commercially preferable and more environmental friendly, which is something we all should thrive for.

We have seen a lot of innovations from law firms to support sustainability and “greener arbitrations“. Law firms had to get used to virtual hearings and generally working more digitally - all aligned with the general net-zero aspirations of the legal industry. The legal community can be proud to have invested so many resources to support this new way of thinking and, more specifically, of conducting hearings.

Virtual hearings are the future if the legal profession is prepared to invest in the right equipment and to being prepared for all eventualities this new way of conducting hearings can bring with it.

Only time will tell how much ‘virtual’ remains a part of the arbitration process, but at least this author thinks that virtual hearings have already enjoyed notable success and with improving technology, increasing expertise and support, the process has and will change for good (and for the better).