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Court vs. commercial arbitration after COVID: Dealing with the backlog

Thursday, September 10, 2020 @ 11:13 AM | By Jeffrey Leon

Jeffrey Leon %>
Jeffrey Leon
In my previous article in this series on the pros and cons of virtual proceedings, whether in court or in arbitration, I stated that one common theme throughout the literature and commentary is that there will be a “new reality” to dispute resolution processes post COVID-19. The first issue discussed in that article was adapting to virtual proceedings. The second “new” issue that I will address in this article is how to deal with the backlog created by the pandemic.

There appears to be universal recognition that the pandemic will result in a significant backlog of cases in our court systems. How long it will take to deal with that backlog is not known but based on experience it will be a long time before the courts are caught up.

While some arbitrations have been delayed, particularly in the early days of the pandemic, delayed proceedings are significantly less of an issue. Arbitrators have the facility and the flexibility to accommodate hearings and to tailor the hearing process to meet the needs of the parties. Internationally, having virtual proceedings often saves days of travel (and the associated costs) and frees up time (although in some instances, the time is needed to accommodate diverse time zones or to have shorter hearing days to avoid “Zoom fatigue”).  

Many arbitrators in Canada — and certainly most arbitrators internationally — have been working with parties to tailor hearing processes to fit the case long before COVID-19. Arbitrators are not bound by relatively inflexible “rules of court.” An expeditious and efficient process, subject to due process and fairness concerns, can be tailored by the arbitral tribunal and the parties, and it will be the preferred way of proceeding. On the other hand, subject to arbitral regimes and rules, if parties really want a “private trial” with all the procedural trappings of court rules and rules of evidence, and even a private appeal, then that too can be accommodated and still result in a speedier resolution of disputes. 

Thus, at least in the short run, and likely the medium run, when weighing the pros and cons of arbitration versus court litigation in a COVID and (hopefully soon in a) post-COVID world, parties — particularly commercial parties — and their counsel should consider seriously the notable advantages that can be achieved by moving their dispute from court to arbitration. Also, courts should recognize that it is in their interest and in the parties’ interests in many instances for the courts to encourage and assist to facilitate the move.

Notably, this is not necessarily a binary choice. While the idea is not new, parties have recognized that cases can get to trial faster by opting to have pretrial matters and case management dealt with on consent through a private decision maker. This too can be important in trying to reduce or prevent post-COVID backlogs.

So, on this basis, the current debate on pros and cons might well be resolved in favour of arbitration.

And we come back to the song mentioned my first article by the Lovin' Spoonful: “Did you ever have to finally decide?/And say yes to one and let the other one ride/There are so many changes and tears you must hide/Did you ever have to finally decide?”

One thing on which we can all agree is that putting the COVID-19 pandemic behind us cannot come too soon, generally and in the specific context of dispute resolution. Dispute resolution in both court litigation and arbitration can and should continue to have aspects of the process conducted virtually. But I believe that there is an important place for in-person human contact and interaction and all that entails in dispute resolution. As reflected above there will be hearings and trials that will better be conducted, in whole or in part, in person. Equally important, there will be some situations in which this human contact and interaction will be helpful to, if not vital to, parties' acceptance of the dispute resolution process, acceptance of the result and satisfaction that, win or lose, they have been treated fairly.

Postscript: In the interest of full disclosure, while I continue my practice primarily as a commercial trial and appellate lawyer, I recently joined Arbitration Place in Toronto as an arbitrator and mediator. I can assure the reader that I would have reached these conclusions regardless of my new venture.

This is the second of a two-part series. Read part one: Court vs. commercial arbitration after COVID: Adapting to the virtual.

Jeffrey Leon is a partner at Bennett Jones LLP and an arbitrator and mediator with Arbitration Place in Toronto. He is the immediate past president of the American College of Trial Lawyers.

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