Hear us out: in-house litigators and the future of virtual hearings

Emily O'Neill
Emily O'NeillGeneral Counsel UK at Deminor Recovery Services
Mehdi MellahSenior Legal Counsel at Deminor Recovery Services

Lockdown and the rise of virtual working has undoubtedly impacted on the justice system. Emily O'Neill and Mehdi Mellah have canvassed in-house litigators and private practice arbitration teams to understand how virtual hearings have influenced the quality of dispute resolution procedures and the costs of litigation. Are virtual hearings here to stay?

The coronavirus (COVID-19) pandemic has undoubtedly led to an increase in virtual meetings for business and socialising virtually for individuals (#NoMoreOnlineQuizzes!), but it has also led to a (r)evolution in virtual hearings in courts and arbitral tribunals.

Lockdown and social distancing measures have meant that Zoom, Teams, and other digital platforms have gradually replaced in-person meetings, which has led to companies realising significant savings in travel and accommodation costs. Courts and arbitral tribunals have specific requirements in terms of submission, storage and sharing of information that are required to ensure a fair hearing.

But has the new virtual world had an impact on the quality of dispute resolution procedures or the accessibility or affordability of seeking and obtaining justice? Have the cost savings anticipated from online hearings been borne out in practice, and will virtual hearings become the new normal outside of pandemic times? When do counsel need to consider whether a virtual hearing of a dispute will be required - when drafting the dispute resolution clause, or when a dispute has crystallised?

In this article, we share our own experience of virtual hearings over the last six months. We have canvassed opinions from in-house litigators and private practice arbitration teams to determine how practitioners, arbitral tribunals and courts have dealt with the inevitable challenges of moving into the world of virtual hearings.

The state of the art

Arbitration has long been a means of dispute resolution that can afford confidentiality to the parties, as well as produce an award which is enforceable against dispersed and global defendants.

In international arbitration, the parties, their counsel, and the arbitrators often reside in different parts of the world. As such, the arbitration sector had already been making use of virtual hearings for case management conferences (CMCs) and procedural hearings pre-pandemic. Occasionally, the location and availability of witnesses also caused witness evidence to be heard via video-conferencing; however, full virtual hearings remained exceptional.

Some arbitration centres have developed their own document management platforms to administer case communication and filings during the arbitral proceedings. The electronic platform of the Arbitration Institute of the Stockholm Chamber of Commerce (SCC) recently celebrated its first anniversary, and the SCC has even developed a platform for administering ad hoc arbitrations. Arbitral institutions (the International Chamber of Commerce (ICC) and the International Centre for Settlement of Investment Disputes (ICSID)) have also played an essential role in facilitating virtual hearings by offering hearing facilities.

General disputes heard in the courts also saw lesser case management hearings held virtually, primarily by telephone as many courts did not have access to reliable virtual platforms for video hearings pre-pandemic. The use of electronic bundles by courts was becoming more widely accepted (subject to the preference of the individual judge).

Just last year, in his book Online Courts and the Future of Justice (OUP. 2019), Richard Susskind foresaw either an evolution or radical transformation towards online courts, and anticipated that the development would be an evolution with incremental and ongoing transformation. Our survey has shown that the parties and, to a lesser extent, the arbitral tribunals are the driving forces behind the changes in the arbitral hearing revolution.

Use of virtual hearing platforms: a dual approach

Zoom, Webex, Teams, and other digital communication platforms have now been widely used in the arbitration sphere as well as in the regular courts as the main medium to facilitate virtual hearings. However, outside of these core platforms, there is a growing number of service providers offering technical assistance and document management services streamline the display and sharing of documents with participants.

These providers also offer additional services such as transcripts and simultaneous translation, with some providing dedicated case managers to monitor and support live setup. This professional technical support inevitably comes at a cost, with providers billing on an hourly/daily rate, and must be factored into the overall budget for trial.

However, practitioners’ overall feedback is that, despite the additional technical support required, virtual hearings are cheaper than in-person hearings, especially ones with many participants. Full virtual arbitration hearings cost in the range of £3K-£5K per day in significant cases with a high number of legal team members, experts and witnesses.

From the first hearings to be held during May and June, we and the practitioners we have spoken to have seen that the quality of the technology, as well as the ability to have a streamlined virtual experience, has significantly increased.

While some hearings experienced issues with viewing documentation, sound quality and offline communication between the legal team during the hearings, these issues appear to have been smoothed out, with platforms providing breakout rooms, and counsel using other forms of communication for internal communication.

Strategy considerations in virtual hearings

Are virtual hearings and online dispute resolution tools appropriate for all types of hearings?

There seems to be a consensus among practitioners that CMCs and procedural hearings can (continue to) be organised virtually.

Opinion is divided on witness hearings. Witness evidence has long been given remotely in some settings, such as expert testimony or where vulnerable witnesses are involved. While some praise the improved technology that allows 360° or detailed camera views, others find it far more challenging to “read” the reactions and body language of witnesses, arbitrators, and opposing counsel during witness examinations and oral arguments through video-conferencing. Practitioners also quoted delays caused by internet connection issues, slow or delayed display of documents/digital hearing bundles as barriers to effectiveness.

Those litigating in the family courts also cite access to justice issues where parties may not have adequate devices to connect to virtual hearings. However, virtual hearings have been an attractive solution to avoid delay to timetables which were fixed prior to the outbreak of the pandemic and minimising court backlogs. Practitioners report that virtual hearings are more streamlined themselves, with less scope for theatricality.

From the in-house perspective, the visible savings in travel budgets and business time in avoiding travel to hearings and for witness preparation must be balanced against the limitations of a virtual hearing, where gauging reactions may be more difficult than in-person hearings. In addition, the risk of witnesses being unduly influenced or guided in virtual hearings (which is considerably less easy when all actors involved in the proceedings are present in the same room), and cyber security are also factors to consider.

Contractual aspects

Virtual hearings and hearing management tools are here to stay. However, most practitioners believe that they will not entirely replace in-person hearings.

Whether a dispute will be heard in person or virtually is likely to be decided by the court itself, with guidance from the parties; there is more freedom within the arbitration field. As such, those drafting and reviewing contracts will now need to consider virtual hearings when drafting arbitration clauses.

Choosing applicable arbitration rules that offer a regulatory framework for digital proceedings, case management, and communications (for example, the 2020 LCIA Arbitration Rules, or the SCC) is likely to save time and money, should a dispute occur.

Conclusion

Overall, practitioners have seen the benefits of virtual hearings during the pandemic and see a role for them long term.

Despite certain shortcomings in the technical platforms for virtual hearings, the feeling is that arbitrators have worked with the parties to adapt and, in general, there has been a collegiate approach to achieve fair hearings. Third parties can observe court proceedings without the need to travel, which has improved access, but the shortcomings of a narrow field of view, together with the cultural expectation in many jurisdictions of an in-person hearing, are acknowledged as drawbacks of the new world.

In-house counsel must also carefully manage expectations around savings in budget, and balance savings in travel and accommodation costs of in-person hearings against the additional costs for facilitating virtual hearings.