Sunday, 29 January 2017

"Alternative" Dispute Resolution

We have ADR in the telecoms industry and it is creeping in to other areas from what I can see.

My issue here is simple, why "alternative"? Surely that simply means the "original" is not fit for purpose? If that is so, why not fix the "original" rather than making an "alternative".

So what is the "original"

Well, to for most civil low level disputes that ADR may cover it is the county courts system under the small claims track.

I have used the courts may times. I have seen them work, and (in my opinion) go wrong. I have been the one making the case, and the defender. I have learned a lot of lessons. In some ways, the fact that I have had to learn lessons is an issue. It should be a process the novice can handle without learning lessons from the past.

The process, and I mean the "small claims process" here,  has some really good features.
  • Fixed costs, starting very low, in the tens of pounds
  • Loser pays (up front if making the claim, so costs known and spent in advance)
  • Lawyers can get involved but their costs are not claimable (and they are looked down on)
  • Judgement is binding (either way)
There are however issues. It is normally a court hearing, in a location where one of the parties may have to travel at some cost (what with so many contracts over the Internet and not face to face). This itself is a problem, and daunting.

There are some things to help - the county court at Reading, and I assume many others, have a system of free (once you have made a claim) arbitration. This is a one hour phone call (so no travelling) alternating the parties, to try and resolve the issue.

This is huge - it removes the travel and the scary court appearance. It will not always work, but I bet it works a lot - anyone got stats on that?

But if that fails the process is not hard. It may seem scary, it is just you, the other side, and a judge, in a room (an office), and discussion. That is all. Not really a problem (apart from travel).

Can we make it better?

The arbitration is good, but we could do more. How about a remote (email) based arbitration as next step. Each party emails arguments and evidence to the judge to consider. If the parties accept that ruling then all done, if not then a court appearance.

I would be in favour of this, even if it has a small additional fee over the telephone arbitration.

Why is ADR bad?

The only ADR we have had was a fucking nightmare. We were not even allowed to see the details of the case against us - what the hell? That is mental and would never be allowed in a court. The judgement was made with no discussion and no appeal. It was final.

Also ADR for ISPs, and others, is cost one-sided, only the ISP pays either way. It allows customers to threaten ADR with no risk even when they know they are wrong. The cost is way more than the county court, by a factor of around 10. How is "alternative" justice so much more expensive than "real" justice? ADR only makes sense if it is cheaper.

My proposal?

Well, the emailed resolution to add to the phone call arbitration for a start.

In some cases we could err on the side of the consumer, maybe having some limits on cost that are more skewed towards ADR. My suggestion is end user must have a risk and up front cost of maybe £5 or £10, so as to remove the frivolous claims. Then maybe up to a certain level for large claims that is all their cost, with company paying the rest (tens of pounds).

Even so, I think cases need to allow counter claims. If ISP says "they have not paid bill", that should be valid. ISP pays fee to counter claim, and adds that to claim if they win. At present ADR is one-sided and cannot act against end user. Why have any one-sided system?

Conclusion

We could make the "real" dispute resolution better and remove the need for "alternative" dispute resolution in so many areas. Let's do that!

4 comments:

  1. Is there any way to protect yourself from the possibility of adr in the first place, by contract terms. Presumably not, otherwise you would already be doing it. :-( Or by being more creative, like not being an ISP, but being a instead. I have no idea what I'm talking about. I'll just shut up now. I know absolute fa about civil law. But a clever lawyer might have a cunning plan for all I know.

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    1. Part of the challenge is that the ADR providers appear to take quite a broad view of their jurisdiction. Even if Adrian were to try and argue that the services fell outside the scope of ADR, or that there was nothing in dispute, the ADR providers may decide to hear the issue and offer a remedy, leaving the CSP is yet another unpalatable position.

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    2. Apologies, I was unclear. If you can somehow ‘not be an ISP’, although some other entity would have to be, then this would put you out of the area where ADR even gets involved in the first place. Say that legal entity A had the contract with the customer, and legal entity B actually provided some ISP-type services (to someone). But as mentioned before _I have absolutely no clue_ what I am talking about, but would be interested to see a map of the solution space, even if it be littered with earlier failed thought-experiments.

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  2. One reason I wouldn't like to see the ADR system go away (even though as you rightly say, there are a lot of problems with the ADR system) is that the court system in Scotland is way behind that of England.

    Up here, we have no equivalent of Money Claim Online, so cases have to be started by getting hold of paper forms and taking them (or posting) them to courts. Much of the system is still manual, we have Sheriff Courts rather than County Courts - and it's not unusual to find that staff at the court have advised you wrongly as to the fee due (which given the payment system is general cheques is a major pain to get corrected), and I don't believe there's much of an attempt at mediation, and certainly not in the same way you've seen in Reading (which sounds excellent).

    https://www.scotcourts.gov.uk/taking-action/simple-procedure has a few details on the "simple" procedure.

    It's highly desirable to improve that situation, but in the meantime the current ADR is useful in Scotland - it would be even more useful if some of the flaws were removed.

    (One of my friends got stung by BT Retail for a 150 quid engineers fee for resolving a fault, as they claimed they'd had to fix wiring on his side of the master socket - despite the engineer on the day not doing so, and directly telling my friend he'd resolved the fault by making changes at the exchange. The ADR sided with BT, even though BT couldn't provide any evidence at all that there was a fault in the wiring, let alone what the fault actually was - all they provided as evidence was a single sentence from the engineer's notes saying he'd found and fixed a fault inside the house with no further detail.)

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