Idea for a virtually-managed civil and commercial arbitration system - Version 2.0
Thinking about the fact that Italian civil courts have long had a very high backlog of pending cases, particularly for commercial disputes between companies, and about how this problem could be eased for the matters that the law allows to be resolved privately, I conceived this system. I thought about it a bit and evaluated some solutions that came to mind.
Important premise: this system applies exclusively to civil and commercial disputes over disposable rights (for example contracts between companies), for which Italian law already allows arbitration (Articles 806 and following of the Code of Civil Procedure) as an alternative to ordinary court proceedings. It does not apply to criminal proceedings or to matters involving non-disposable rights, which remain the exclusive competence of the ordinary judiciary.
The best solution I could think of is this: create a sort of "virtual" arbitration management. All the data of the dispute are uploaded into a dedicated portal (so if the documentation is on paper it all needs to be scanned and digitised). Lawyers and arbitrators should then register to participate, specifying their skills, personal data, their enrollment in the relevant professional registers (for arbitrators, a requirement already set out by arbitration law) as well as the details for making payments. At that point the portal, with an algorithm, creates "virtual arbitration chambers": the lawyers of both sides are assigned (one or more depending on the amount of documentation that is part of the case and also based on the lawyers' skills), and one or more arbitrators are proposed to the parties from those available, competent in the specific matter, generally with more years of experience. Unlike lawyers (who can remain protected by a nickname towards the opposing party to shield them from possible retaliation), the identity of the arbitrators must always be known to both parties, who have the right to know it and to request their recusal in case of a conflict of interest, as required by law. This whole process creates virtual rooms using, for example, a tool like Slack (a workspace for each case with mainly 5 rooms: 'claimant party lawyers', 'respondent party lawyers', 'lawyers common space', 'arbitration hearings' and 'general communications'), in which people can debate in writing, exchange material of all kinds and, if necessary, also hold video conferences. Obviously the lawyers involved can only access the rooms they are entitled to, always established by the algorithm based on common sense. Arbitrators' fees are not paid directly by the company that has them as a decision-maker in its own case, but are deposited in advance by both parties into a neutral fund managed by the portal (as already happens in existing arbitration chambers), so as to avoid any conflict of interest. So the portal, in addition to creating these virtual spaces for managing arbitration proceedings, also manages payments, the contract under which lawyers and arbitrators are engaged, timing and rules (which must in any case comply with what is set out in the Code of Civil Procedure regarding arbitration). In my opinion, this approach would be genuinely useful, because:
- it ensures management by people competent in the matter
- it protects lawyers as workers by allowing smart working
- it gives work to people who may be in difficulty
- it effectively resolves commercial disputes
- it's fast
- it has contained costs compared to lengthy ordinary litigation
- it protects the safety of lawyers (not of arbitrators, whose identity must be known to the parties) from possible retaliation, through the use of nicknames towards the opposing party
- it reduces the risk of conflicts of interest thanks to the neutral fund for arbitrators' fees
- it guarantees continuity even in the event of incidents that temporarily make physical courthouses unavailable, or during public health emergencies
- it allows for easier evolution of the system through analysis of arbitration proceedings and their outcomes
As regards the management of the portal, operators should be responsible for managing the fee fund and distributing it to lawyers and arbitrators based on what is established, as well as carrying out routine checks to verify that the system functions regularly and in compliance with arbitration law. In addition to this, they should remain available to lawyers and arbitrators for any needs or to collect feedback on further implementations to improve the system.
To be operational, a system like this should be built by a recognized arbitration chamber, or in collaboration with one, so as to meet all legal requirements; this is just a draft of the idea, concerning mainly the organizational and digital side, not the legal one. The basic concept, however, is to use virtual arbitration chambers to make the resolution of commercial disputes between companies faster and cheaper, without affecting in any way the ordinary justice system for the matters that the law reserves to it (first and foremost, criminal law).
Written by : Marco Bagnaresi
Email : contact@mbcraft.it