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Evolution of ODR

Evolution of ODR

Do you find that ODR is naturally evolving on its own?

 

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I know a lot about what’s going on in ODR, but sometimes you discover there were people who were doing ODR and basically invented everything from bottom up without being aware of their being a field at all. We have one such example in Israel. It was very successful. It’s called Benoam. So Benoam is this online arbitration entity that was set up in Israel to address fender benders, subrogation claims between insurance companies, and they filled in a vacuum. Basically these companies were looking for a more effective way to deal with these disputes, that was outside of the court system.

 

The court system didn’t want them there and they didn’t want to be in the court system. They needed another kind of solution. So these folks who were involved with ADR, we’re talking about the late ’90s, initially thought of maybe mediation, but they figured out this wasn’t for mediation. These were small monetary claims of a repetitive nature. They needed some kind of finality and a quick process, so they opted for arbitration. As they were designing this process, they realised that if they were going to need space for meeting and for storing documents and all that, they were really replicating the inefficiencies of the court system.

 

So the internet was expanding in those days, communication was better, service was better, and they had this idea why don’t we do it online? They were totally unaware that there was a whole industry out there, not very developed, people who were doing this, people who were thinking about this. They developed a beautiful system which was very effective and turned out to do a lot more than just streamline these claims.

 

They actually became this kind of a private court where they had even a space they called news where they would post precedential decisions by the arbitrators. So they created this sort of private system that was also not only being effective but it was also sending signals to its users, that it was fair, because it was consistent in decisions, there were precedents. They adopted all kinds of principles that ensured consistency in their arbitrators’ decision making, and I think it showed some of the potential of ODR.

 

Still, kind of, the claims are not very . . . I guess these are the types of claims we would think are appropriate for ODR, but this was taking place in Israel, where people are very close to one another. Distances are not, you know, immense, so kind of a surprise, and among quite traditional conservative bodies. You wouldn’t think they would be the first to design such an advanced system.

 

It’s a very interesting example also of how evolutionary ODR is. You start out with one conception of what this process is supposed to deliver and do, and I think it turned out to be a very different entity and service than what they had initially imagined. They loved it. They embraced it. Also impacted the way these companies worked. If we talk about changes and fearing changes, these companies all shifted from a geographical spread to a centralised administration of claims, because it didn’t make sense to be spread geographically if you don’t go to courts, right?

About the mediator

Orna Rabinovich Profile Pic

Orna Rabinovich-Einy is a senior lecturer (with tenure) at the Faculty of Law at the University of Haifa. Her areas of expertise are alternative dispute resolution (ADR), online dispute resolution (ODR), and civil procedure, with research focusing on the relationship between formal and informal justice systems, dispute resolution system design and the impact of technology on dispute resolution. Rabinovich-Einy is a fellow of the Haifa Forum of... View Mediator