New frontiers: technology and dispute resolution
One of the cornerstones of dispute resolution is that it should be conducted efficiently and cost effectively. Given the increasing pressure on lawyers to adhere to this, together with the increased volume of disputes, lawyers in this field have had to leverage legal technology to achieve case efficiencies, as well as grapple with disputes that novel technologies are giving rise to. Disruptive technologies are forcing lawyers – even the most old-fashioned – to rethink the way they work.
Covid-19 has driven the work of courts and tribunals itself – usually a bastion of tradition and hierarchy – online. Parties, or their lawyers, are already required to file case documents electronically, enabling judges or other arbiters to access the documents immediately. The courts also now accept social media as a site of alternative service: where there are good reasons – for example, doubts about the postal address of a defendant – claims may be initiated via Facebook and WhatsApp. During the recent period of lockdown, administrative hearings have been conducted by telephone and substantive hearings in the senior and commercial courts via video conferencing. Some upcoming trials are likely to be “hybrid”, with a handful of socially distanced lawyers in the courtroom and other parties connected to the hearing virtually. True to the principle of open justice, journalists and court reporters have largely been able to join those virtual hearings.
The upheaval caused by coronavirus has prompted questions about whether the current crisis will trigger a broader rethink about the future of dispute resolution. In a recent survey conducted by the Civil Justice Council (CJC) on the impact of Covid-19 on the civil justice system, 71.5% of respondents (who were overwhelmingly lawyers) described their experience as positive or very positive. Whilst there will always be question marks over the efficacy of remote cross-examination, the absence of in-person communications within and between legal teams and their clients, timing issues where translators are required and inevitable “internet connectivity” and other technical hiccups, technology has largely enabled “business as usual” during the global pandemic so far as the operation of the courts and tribunals have been concerned. Going forward, remote hearings may become the new normal for preliminary matters, interlocutory hearings, costs disputes and trials without evidence, at least where both sides have legal representation.
Looking more widely on the impact of technology on dispute resolution, AI has transformed the life cycle of a dispute. At the outset, lawyers have begun embracing early case assessment technologies, like Brainspace, to explore key issues early on and help shape case strategy. Later down the line, multiple technologies have been developed to re-engineer the disclosure phase of a case and the handling and exchange of electronic documents – from the identification and collation of data, to its review and production. The use of cloud-based storage and processing has allowed client data to be available for analytics and review much faster than was previously considered possible.
Beyond just the platform on which data is held, the development of AI algorithms and machine learning technologies, including Relativity and Reveal, have streamlined the review process itself. Breaking away from the conventional linear review process, technology assisted review (TAR) has enabled documents that are most likely to be relevant to be reviewed first. By observing decisions made by the human reviewer, TAR – or Continuous Active Learning – develops an algorithm to predict the likely relevance of a document to a given set of issues. The software then ranks documents according to their likelihood of relevance so that documents that are unlikely to be relevant do not need to be reviewed. TAR has the potential to dramatically reduce a collection of 900,000 documents to 100,000 within a matter of hours. With such power to cut time and costs, TAR is fast-becoming an essential tool in a disputes lawyer’s armoury. It is critical that a disputes lawyer knows how to work with and deploy these technologies.
Technology is not only changing the conduct of dispute resolution, but in a world of constant data generation, it is creating more datasets for investigation. With the advent of digitisation and automation of financial systems, crimes have become more electronically sophisticated and impersonal. In tandem with the growth of financial fraud and cybercrime, the courts have been willing to grant freezing injunctions against “persons unknown”, requiring international and overseas banks to freeze accounts and to reveal the identity of the alleged fraudsters and details of any further transfers made.
Mobile technologies, together with their various messaging apps, are also forms of data – dispersed across multiple locations including social media and the cloud – that are likely to require forensic collection and investigation in any given case. That forensic data collection process may be easier in respect of emerging technologies which can never be erased, namely blockchain and smart contracts – the other major “disruptor” in dispute resolution. With the rise in use of digital currencies and smart contracts, the English courts have had to consider how cryptoassets and related transactions should be treated as a matter of law. Following a ruling by the International Commercial Court in Singapore, which held that cryptocurrencies could be considered property capable of being held in a trust, there have been signs of a trending consensus towards the recognition of cryptoassets as property. More recently, the UK Jurisdiction Taskforce’s (UKJT) Legal Statement on Cryptoassets and Smart Contracts concluded in November 2019 that cryptoassets could, in principle, be treated as property.
Continuing changes in technology put pressure on dispute resolution lawyers and related third parties to adapt or risk a disconnect with the clients they are acting for. It is no longer acceptable to shy away from the technology by suggesting it is not thorough enough. It is also not the case that technology replaces the human element – if anything it enhances the human work experience and elevates the tasks to be done by a human building on their skills.
There has never been a more exciting time for the legal technophiles amongst us.
Kushal Gandhi is a Partner at international law firm CMS in London, specialising in Finance and FinTech dispute resolution. Devina Shah is a dispute resolution Associate at CMS in London. This article reflects Kushal’s and Devina’s personal views.