ONLINE DISPUTE RESOLUTION

A CASE STUDY BASED EXAMINATION UNDER INDIAN ARBITRATION LAW

- Devika Singh1

Abstract: ODR or online dispute resolution is increasingly a necessary face of ADR and
not a separate form. It is also not a new development. In this world of instant
communication, disputes require instant redressal which traditional modes of dispute
resolution are unable to proffer. In today’s rapidly paced world of science and
technology, it is quite common to witness technological advances occurring so fast
that the law is hard pressed to keep up. A similar situation has arisen with ODR. The
paper discusses, on the basis of a case study, whether ODR can be fully embraced
within the framework of the Indian law on arbitration and if not, identifies potential
obstacles and suggests practical solutions. After reflection and it is ascertained that
the majority of the issues can be resolved merely by “deeming” a juridical seat or
place for the virtual arbitration. Also, ODR can be conducted in an impure form to
accommodate present-day formal requirements by rendering the awards in writing
with the signature (or digital signatures) of the arbitrators. Upon analysis, it is evident
that only minor adjustments are needed for Indian law to fully embrace ODR as a
preferred mode of arbitration. There is already a very positive trend towards
embracing all facets of ODR in India and it is evident that this trend will only
strengthen with passing time.

A. INTRODUCTION

Today, the new buzzword in the arena of alternate dispute resolution or ADR is
‘ODR’ – Online Dispute Resolution. Sometimes called a form of ADR, it may be
more accurate to say that ODR is increasingly a necessary face of ADR and not a
separate form. ODR is not a new development. It has been a matter of growing
interest since 1997 when Jasna Arsic wrote one of the seminal papers on international
commercial arbitration on the internet.2

1
Advocate, Bar Council of Delhi and Solicitor, England and Wales.
2
J. Arsic, International Commercial Arbitration on the Internet: Has the Future Come Too Early?
(1997) 14 J. Int’l Arb. 209.

1
 As society become increasingly techno-savvy, jurisdictions and boundaries melt for
trade and commerce and people all around the world congress on the internet sans
distance, such a development was bound to happen. In this world of instant
communication, disputes require instant redressal which traditional modes of dispute
resolution are unable to proffer. Traditional modes are also ill-equipped for cutting
across strongly held and honoured legal and jurisdictional boundaries. It has oft been
commented that cyberspace with its new array of technologically possible
relationships and contractual freedom is a challenge to international commercial
arbitration.3

Despite the overwhelming concept of freedom that the internet promises, cyber
commerce has necessitated that the internet reengage and reaffirm the constant need
for control or what Lawrence Lessig4 famously termed “regulability”. In his seminal
work, he commented, “The invisible hand of cyberspace is building an architecture
that is quite the opposite of what it was at cyberspace’s birth. The invisible hand,
through commerce, is constructing an architecture that perfects control – an
architecture that makes possible highly efficient regulation.”5

In a manner, ODR is merely a facet of that regulability and though not per se the
architecture that Lawrence Lessig envisaged, it does brush shoulders with the tools of
code. It is not a product of government or statute but of commerce.

In today’s rapidly paced world of science and technology, it is quite common to

witness technological advances occurring so fast that the law is hard pressed to keep
up. A similar situation has arisen with ODR. The purpose of this paper is to discuss,
on the basis of a case study, whether technological innovations (or commercial
innovations) such as ODR can be fully embraced within the framework of the Indian
law on arbitration and if not, identify the loose threads that need tidying. This is
particularly useful for parties that wish to resolve their existing or future disputes

3
K. Lynch, The Forces of Economic Globalization: Challenges to the Regime of International
Commercial Arbitration (The Hague: Kluwer Law International, 2003) at 345.
4
A fellow at the Wissenschaftskolleg zu Berlin 1999-2000, was previously a professor at the Harvard
Law School and a fellow at the Berkman Centre for Internet and Society.
5
Lawrence Lessig, Code and other Laws of Cyberspace, 1999 Ed., Basic Books.

2
 through ODR given its advantages over traditional dispute resolution such as
litigation or even ADR in terms of cost, efficiency and speed.

B. ONLINE OR OFFLINE DISPUTES – DEFINING ODR

At times, the best strategy towards understanding is one of exclusion. Hence, as a

starting point it is necessary to draw out the scope of this paper by clarifying to what
is and is not included in the definition of ODR.

Often, in traditional dispute resolution, arbitrators may accept their roles through an
exchange of emails, or may, during the course of arbitration, conduct proceedings by
electronic means in online settings. Video-conferencing has become quite common
and several international arbitrators prefer to email awards for the sake of
convenience and cost. It is best to clarify at the initial juncture that any isolated online
processes and procedures applied in the course of traditional arbitration is not
included within the ambit of ODR for the purpose of this paper.

Pedagogically, online dispute resolution has developed two avatars. The first is online
dispute resolution for online disputes and the second is online dispute resolution for
offline disputes. In the first avatar, the source of the dispute may be an electronic
contract drawn between parties engaging in cyber commerce, wherein the parties
decide to resolve the dispute through the systematic and continued use of online
techniques or submit it for resolution to an online forum.
In the second avatar, the source of the dispute is offline i.e., a corporeal written
contract, drawn by parties outside the cyber world, wherein the parties decide to
resolve their disputes through the systematic and continued use of online techniques
or submit the dispute to an online forum for resolution.

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 Despite different sources, both avatars culminate at a singular form or forum which is
online. For the purpose of this paper, both avatars fall within the scope of ODR.
Hence, this paper proceeds on this broad definition of ODR.

Regardless of the virtual nature of ODR, the fact of the matter is that eventually the
parties need to interact with the real world. Such interaction may or may not arise at
an injunctive stage but it would definitely apply at the enforcement stage. Through the
following case study, this paper will examine the acceptance of ODR under Indian
law.

C. ODR IN CONTEXT – A CASE STUDY

An Indian company - Inditech purchases a bulk order of books from an online site
www.booksandmore.com hosted by a French company – Francotech. The
purchase is done online through the website’s payment portal which is hosted on a
separate server in Hong Kong. During the course of the purchase, Inditech checks a
box on the main payment page that indicates that by checking this box it agrees to
accept all the terms and conditions of purchase. Upon delivery in India, Inditech
decides that the order is not as per its requirements. It therefore takes action on
Francotech’s payment portal as a result of which it is able to withhold fifty percent of
the payment due to Francotech. Francotech raises a claim against Inditech and
Inditech raises a counter claim against Francotech. The website’s terms and
conditions state that all disputes will be settled by arbitration by a sole arbitrator at
www.virtualarbitration.com. This website is hosted by a server in England. An
online arbitration award is rendered in favour of Francotech and transmitted to the
parties through email (“Virtual Award”). Francotech initiates enforcement
proceedings against Inditech in the Delhi High Court.

D. EXAMINATION

The law relating to domestic arbitration, international commercial arbitration 6 and

enforcement of foreign arbitral awards in India is the Arbitration and Conciliation

6
Those arbitrations where at least one part is a foreign national is referred to as an international
commercial arbitration.

4
 Act, 1996 (“1996 Act”). Hence, in order to be enforced, the Virtual Award will need
to satisfy the requirements and conditions of the 1996 Act.

The 1996 Act has two parts relevant for the purposes of this examination 7. Part I is
stated to apply where the place of arbitration is in India. This provision has been the
subject of relatively recent controversy in the Supreme Court of India (“SC”). In
Bhatia International v. Bulk Trading8, the SC had held that in the absence of the word
“only” in section 2(2) of the 1996 Act, Part I will apply to arbitrations held outside
India as long as Indian law governed the contract. The SC concluded that Part I will
apply to all arbitrations where the seat of arbitration is outside India, unless the parties
agree to exclude provisions of Part I. This view was again reiterated by the SC in
Venture Global Engineering v. Satyam Computer Services9. Both these judgments
have garnered much criticism which the Law Commission of India (“LCI”) has, in a
recent consultation paper, attempted to put to rest by the recommendation that section
2(2) be amended to clarify that Part I would apply “only” where the place of
arbitration is India. Hence, there would be no application in international commercial
arbitrations where the place of arbitration is outside India.

In the case study, the place of arbitration is in virtual reality. It cannot be clothed in
any jurisdictional garb. Therefore, the already existing ambiguity on the application of
Part I in traditional arbitration is accentuated in this case. With an online dispute
resolution mechanism, it is difficult to identify the actual “seat of arbitration”. The
parties are from India and France, the payment portal is hosted in Hong Kong and the
virtual arbitration website is hosted in England. The place of arbitration would clearly
have shifted various jurisdictions during the arbitration proceedings. Inditech and
Francotech may have also involuntarily chosen a seat of arbitration that is deemed in
the terms and conditions of the www.virtualarbitration.com. However, it is an
acceptable assumption that the place of arbitration cannot be India.

7
Part I is entitled “Arbitration” and consists of 10 chapters containing sections 2 to 43. Part II pertains
to
“Enforcement of foreign awards” and Part III deals with “Conciliation”.
8
(2002) 4 SCC 105.
9
(2008) 4 SCC 190.

5
 Yet, in the presence of precedent and the absence of clarity, the first challenge of
ODR in India is clear identification of the place or seat of arbitration. Parties wishing
to submit their disputes to ODR should ascertain that the place of arbitration is
deemed to be a specific jurisdiction either by the rules governing the online institution
to which they submit their dispute or, in case of an adhoc arbitration, by agreement of
the parties themselves. This would go a long way in ensuring the success of ODR.

Merely for the sake of furtherance of this paper, it is being assumed that Part I of the
1996 Act does not apply in the instant case as the place of arbitration is not India. The
Virtual Award is therefore a foreign award 10 to which Part II of the 1996 Act would
apply. Under Part II, the legitimacy of the Virtual Award would be questioned on
three fronts in court. First – the validity of the arbitration agreement between Inditech
and Francotech; second – the procedural integrity of the arbitrator and the arbitration
at www.virtualarbitration.com; and third – the completeness and finality of the
arbitration award from the purview of enforcement.

D.1 VALIDITY OF THE ARBITRATION AGREEMENT

The most often quoted challenge of ODR is the traditional “in writing
requirement”. Today, arbitration agreements are increasingly being concluded
through the means of electronic transmission instead of the traditional paper
and pen with the participating parties’ signatures. Yet, the single most
important document that is the basis of international commercial arbitration –
the Convention on the Recognition and Enforcement of Foreign Arbitral
Awards (“NYC”) was written and adopted well before the age of the internet.
Under Indian law, Section 44 of the 1996 Act requires that a foreign award
should be in pursuance of an agreement in writing for arbitration to which the
NYC applies. Not only does Section 44 itself refer to an “agreement in

10
Section 44, 1996 Act, Definition.- In this Chapter, unless the context otherwise requires, “foreign
award” means an arbitral award on differences between persons arising out of legal relationships,
whether contractual or not, considered as commercial under the law in force in India, made on or after
the 11th day of October, 1960- (a) in pursuance of an agreement in writing for arbitration to which the
Convention set forth in the First Schedule applies, and (b) in one of such territories as the Central
Government, being satisfied that reciprocal provisions have been made may, by notification in the
Official Gazette, declare to be territories to which the said Convention applies.

6
 writing” but so does the NYC at Article II11. Both the 1996 Act and the NYC
are representative of a general practice. Article 7 (2) of the UNCITRAL
Model law also indicates that the arbitration agreement will be in writing.
Even the national arbitration law of one of the parties of the case study,
Francotech, provides that, to be valid, an arbitration clause shall be in writing
and included in the contract or in the document to which it refers.12

The central question is when Inditech and Francotech entered into an

agreement of arbitration in the manner demonstrated in the case study did the
exchange satisfy the core requirements of the NYC and the 1996 Act? Prima
facie, the answer is in the negative, simply because it was not in writing.

However, before and consequent to the development of several laws

governing e-commerce, several judicial pronouncements the world over have
addressed the paradox that there is no place in major documents of
international arbitration for the currently most popular means of data
transmission. As a result of this it has been convincingly argued and accepted
that an exchange of email messages containing an arbitration clause satisfies
the formal requirements of Article II (2) of the NYC, because an exchange of
emails can be equated to an exchange of telegrams13.

Still, on the face of it, Inditech merely checked a box indicating its assent to
the terms and conditions of Francotech’s website. Nor was there a signature
put to a contract and neither was there an exchange of letters or telegrams or
emails. In this case, the validity of the arbitration agreement can be based on
the functional similarity in the transmission of data that occurred when the box
was checked which can be likened to an exchange of emails 14. The “functional

11
Article II, NYC – 1.Each Contracting State shall recognise an agreement in writing under which the
parties undertaking to submit to arbitration all or any differences which have arisen or which may
arise between them in respect of defined legal relationship, whether contractual or not, concerning a
subject-matter capable of settlement by arbitration. 2. The term “agreement in writing” shall include
an arbitral clause in a contract or an arbitration agreement, signed by the parties or contained in an
exchange of letters or telegrams.
12
Article 1443 of the French Code of Civil Procedure.
13
Supra Note 1 at 216. See also R. Hill, “On-line Arbitration: Issues and Solutions”, (1999) 15 Arb.
Int’l. 199, available also online: <http://www.umass.edu/dispute/hill.htm>
14
See R. Hill at Note 12.

7
 equivalent approach” was propounded in the UNCITRAL Model Law on E-
commerce15 and is based on how electronic techniques can be compared and
utilised as the functional equivalents of traditional paper-based requirements.

When the offer contained in the Francotech website was viewed by Inditech,
the bits comprising the offer, originally stored on the website server, were
transmitted through a network to Inditech’s computer. When Inditech accepted
the offer by checking the box, the bit stream comprising the offer and resident
in Inditech’s computer was modified by Inditech and then that modified
version was transmitted back to Francotech’s website server. Thus there took
place an exchange of data or electronic transmissions which is comparable to
the exchange of documents envisaged both under the NYC and the 1996 Act.
Consequently, it can be concluded that a valid arbitration agreement was
entered into.

Indian law has accepted such similarities and thus the validity of such
transactions through enactment of the Information Technology Act, 2000 (“IT
Act”. The IT Act has enacted to facilitate and encourage e-commerce by
recognizing electronic records and digital signatures. Section 4 of the IT Act
states that a requirement of any law for information or matter to be in written,
printed or typewritten form shall be deemed to have been satisfied if such
information or matter is rendered or made available in an electronic form and
is accessible so as to be re-usable for a subsequent reference. Section 4 of the
IT Act recognizes digital signatures and provides that the requirement of any
law for authentication by a person’s signature shall be deemed to have been
satisfied if such authentication is done by means of a digital signature.

15
UNCITRAL Model Law on Electronic Commerce with Guide to Enactment
<http://www.uncitral.org/en-index.htm>. See also Directive 2000/31/EC of the European Parliament
and of the Council of 8 June 2000 on certain legal aspects of information society services, in
particular electronic commerce, in the Internal Market (Directive on electronic commerce), published
in Official Journal of the European Communities dated 17.7.2000, L 178/1 http://europa.eu.int/eur-
lex/pri/en/oj/dat/2000/l_178/l_17820000717en00010016.pdf which requires member states to do
away with formal obstacles in electronic contracting..

8
 Having said that, even in the best of cases, agreements entered in certain
online settings are open to questioning. Several concerns have always been
associated with the quality of a parties’ consent given online. In the context of
arbitration agreements, valid consent has always been of fundamental
importance and this has lead to the emphasis on the in-writing requirement.
Formalities such as writing and signature are based on the need for some
physical evidence or authentication from the person who has given up his right
to litigate in national courts. Written evidence is regarded as essential to
ascertain such an intention16.

When a single click of the mouse suffices as acceptance of an arbitration

clause, the law views it with a lack of trust as to whether such a minor act is a
reflection of a party’s fully informed consent. The problem is exacerbated,
when the arbitration clause is tucked away in a range of general terms and
conditions.

Parties resorting to ODR or forums offering ODR can overcome such issues of
trust by the presence of a clear and conspicuous reference to an arbitration
clause. Along with this, the website can even offer to automatically save a
copy of the agreement on the computer of the acceptor. This would be a
sufficient record of the agreement. Such practical steps would greatly assist
the courts in India, which have already indicated a very positive outlook
towards electronic techniques supplanting and supplementing traditional
norms as has been elaborated on in the following passages, in upholding ODR.

D.2 PROCEDURAL INTEGRITY

Issues of procedural integrity arise on two counts in ODR. The first is on

usage of electronic/cyber techniques in the course of arbitral proceedings.

In the case study, all arbitral proceedings were conducted online and hence
through such techniques. Transmission of notice of arbitration, notice of

16
H. Yu & M. Nasir, Can Online Arbitration Exist Within the Traditional Arbitration Framework?
(2003) 20 J. Int’l Arb. 455 at 458.

9
 appointment of arbitrator, exchange of documents, counters and rejoinders,
admission of evidence and other similar acts occurred in electronic form
through instantaneous transmission over the internet. In the absence of
physical meetings between the arbitrator, Inditech and Francotech, diverse
electronic exchanges17 like virtual conferencing would have simulated and
fulfilled traditional needs of an arbitration.

In India, the e-justice system has been quite robust and there is an increasing
judicial recognition of information technology and electronic techniques
supplanting traditional legal requirements. For example, in 1999, the SC
construed the words “notice in writing” in section 138 of the Negotiable
Instruments Act to also include a notice by fax18. It requires not great stretch of
imagination to extend this construction to include notice by email also. In
2003, in the case of State of Maharashtra v Dr. Praful B Desai 19, the SC
recognized evidence by way of electronic records and also recording and
production of evidence by way of video-conferencing. A similar view on
video-conferencing vis a vis physical presence had been taken by the SC in the
case of Basavaraj R Patil v State of Karnataka20 also.

Such judgments, though not directly in the context of ODR, evidence the
willingness of Indian courts to embrace technological advances. It would not
be averse to say that just like the encouragement given to ADR by Indian
courts, ODR too would be encouraged.
Despite such positive judgments, the question that still remains is whether
such techniques have any negative impact on the procedural integrity of
arbitration in the eyes of the law. The answer lies in two words – “party
autonomy’21. The principle of party autonomy or procedural autonomy is a

17
O. Cachard, International Commercial Arbitration: Electronic Arbitration (New York: United
Nations Conference on Trade and Development, 2003),<
http://www.unctad.org/en/docs/edmmisc232add20_en.pdf>
18
M/s SIL Import, USA v M/s Exim Aides Silk Exporter, AIR 1999 SC 1609.
19
2003 (3) SCALE 554.
20
(2000) 8 SCC 740
21
J. Hörnle, “Online Dispute Resolution: More than the Emperor’s New Clothes” in E. Katsh & D.
Choi, eds., Online Dispute Resolution (ODR): Technology as the “Fourth Party”. Papers and
Proceedings of the 2003 United Nations Forum on ODR (2003),
<http://www.odr.info/unece2003/pdf/Hornle.pdf>; See also supra Note 15 at 465.

10
 fundamental principle of arbitration law and is globally recognized and
adhered to. In 2002, the SC had ruled favourably for technology and party
autonomy and observed in context of an offline arbitration that “when an
effective consultation can be achieved by resort to electronic media and
remote conferencing, it is not necessary that the two persons required to act in
consultation with each other must necessarily sit together at one place unless
it is the requirement of the law or of the ruling contract between the parties.22”

It is recognized under the 1996 Act in section 19(2) which states that parties
are free to agree on the procedure to be followed by the arbitral tribunal in
conducting its proceedings. In India, party autonomy is subjected only to two
caveats – that the parties are treated with equality and that each party is given
a full opportunity to present its case23. Hence, it can be concluded that as long
as the two caveats are satisfied, it is possible to adapt the entire procedure to
the virtual world under Indian law.

However, as can be seen even in Indian law, party autonomy cannot prevail
over or undermine the mandatory provisions of the law that governs the
arbitration procedure. Hence, identifying the law that governs the arbitration
procedure of a virtual arbitration gains importance.

As discussed above, in the case study, the seat or place of arbitration is virtual
and not physical. Consequently, the country whose law would govern the
virtual arbitration proceedings is unidentifiable. While the final solution to this
problem is delocalization of arbitration, the current framework of international
commercial arbitration makes delocalization very difficult and impractical.
International commercial arbitration is by definition a cross border activity and
every state is highly protective of its borders.

In such a situation, to maintain equity and fair mindedness, the virtual

arbitration proceedings would have to satisfy mandatory procedural elements
of French, Indian, Cantonese and English law since all four jurisdictions are

22
Grid Corporation of Orissa Ltd. v AES Corporation, 2002 AIR (SC) 3435.
23
Section 18, 1996 Act.

11
 involved in the problem! This is hardly reasonable or efficient. Moreover, the
Delhi High Court would be hard pressed during enforcement and in all
likelihood the burden of satisfaction would be too great for the award to be
successfully enforced.

Again, such problems in ODR can be overcome by deeming, at the outset, the
seat or place of arbitration. The law of the place would automatically govern
the arbitration procedure thus providing certainty and finiteness. In case the
parties wish to have a different law of procedure from the seat, this can be
specified in the arbitration agreement. There is a well established trend to
support such choices even in traditional arbitration and in ODR making such a
choice may be more of a necessity than a convenience.

While the above suggested device is suitable in an adhoc virtual arbitration, an

institutional arbitration presents its own set of complexities. If parties agree on
institutional arbitrational, the institution’s rules would prevail and may conflict
with the parties’ intent to conduct arbitration online. In such a case, lawyers
would need to advice their clients to explicitly agree, in the arbitration
agreement itself, to override any institutional rules that may conflict with their
desire to conduct an online arbitration. Gradually, as ODR causes more and
more arbitration institutions to reword their rules to accommodate online
proceedings, such conflicts are bound to disappear24.

On the second count, issues of procedural integrity arise in the context of the
virtual award. The central question here is whether law supports an arbitral
award in its virtual form or does it require that it in writing or signed or
rendered in any other specified manner?

The NYC itself does not state that an arbitral award needs to be in writing or
signed. However, Part I of the 1996 Act requires that an arbitral award be in
writing and be signed by all the arbitrators under section 31. Once the arbitral
award is made, the provision also requires that a signed copy be delivered to

24
M. Schellekens, Online Arbitration and E-commerce (2002) 9 Electronic Communication Law
Review 113.

12
every party. Clearly, in the case of domestic arbitration (to which Part I
applies), the desire to conduct a pure ODR would be defeated at this stage by
the limited provisions of the 1996 Act. While sections 4 and 5 of the IT Act
may well be the solution, in the absence of any case laws on this issue, it may
be prudent to be conservative. Hence, at least in Indian domestic arbitrations it
would be better for arbitrators of ODR forums to comply with the
requirements of section 31 when rendering an arbitral award.

The case study however relates to Part II of the 1996 Act. Part II in turn refers
to the NYC which, as clarified above, has no provisions regulating the form or
content of an arbitral award. However, Article IV of the NYC refers to the
production of a “duly authenticated original award” by the party seeking
recognition or enforcement of the award. Consequently, section 47 of the 1996
Act also states that,

“The party applying for the enforcement of a foreign award shall, at

the time of the application, produce before the court -
(a) the original award or a copy thereof, duly authenticated in the
manner required by the law of the country in which it was made;
(b) the original agreement for arbitration or a duly certified copy
thereof; and
(c) such evidence as may be necessary to prove that the award is a
foreign award.”

In the case study, arbitration has taken place online on the website
www.virtualarbitration.com. The arbitral award has been transmitted to both
the parties by email. There is no such thing as an original or copies of the
Virtual Award since it is an electronic file and electronic files are infinitely
reproducible. So how will ODR overcome this obstacle?

Clearly, the requirement of an original or a duly authenticated copy under both

the NYC and the 1996 Act is as a measure of the veracity and security of the
arbitral award and is a method of confirmation not only of the contents of the
arbitral award but also the identity of the arbitrators rendering it. Following

13
 the principle of functional equivalence, such objectives can be achieved in
ODR by requiring arbitrators to apply their digital signatures to the awards. A
flexible interpretation of the NYC and of the 1996 Act would surely include
such secure electronic documents to be the functional equivalent of the
“original”. Legal trends on electronic commerce would undoubtedly aid such
positive interpretations by Indian courts. However, practical problems of
guaranteeing integrity and attribution to the arbitrators would remain when
submitting electronic awards as paper documents with the registry. Similar
issues would also arise for fulfilling the requirement of submitting the original
agreement of arbitration.

Even obtaining a “duly authenticated copy” of the Virtual Award would prove
to be a problem. Firstly because, there are limited authentication services in
India that can authenticate a digital signature and secondly because the
authentication is to happen in a manner required by the law of the country in
which the award is made and as we have already ascertained, the Virtual
Award has no situs. In such an event, which country’s law would apply for the
purposes of authentication is an unresolved grey area not only in the law but
also in our case study. This once again emphasizes the importance of deeming
a “place” or “seat” for the ODR. Even more so when the third requirement of
section 47 is the submission of evidence that proves that the Virtual Award is
a foreign award. Usually when the arbitral award states that it is made in a
place other than India, such evidence is sufficient to satisfy this requirement.

D.3 COMPLETENESS AND FINALITY OF THE VIRTUAL AWARD

Eventually, as is the case in most ODR, the Virtual Award of the case study
passes the cyber realm and is put to test in the physical world of the Delhi
High Court for enforcement. This is an inevitability of ODR and the sole
reason why delocalization is unable to succeed in the territorial world. Though
Inditech and Francotech or www.virtualarbitration.com may achieve
delocalization in ODR to a limited extent by “deeming” the seat of the virtual
arbitration, this is not in effect delocalization but merely a manner of re-
establishing a form of territoriality over the Virtual Award.

14
 Notwithstanding theory, practically, the necessity for “deeming” a juridical
seat for the arbitration is once again evident from Article V(1)(d) of the NYC
which specifies the grounds on which enforcement of an award may be
refused, one of the grounds being “if the arbitral procedure was not in
accordance with the agreement of the parties, or, failing such agreement, was
not in accordance with the law of the country where the arbitration took
place.” This ground is replicated in the 1996 Act at section 48(1)(a). Similar
issues are reagitated by section 48 (1)(d) and (e) which state “(d) the
composition of the arbitral authority or the arbitral procedure was not in
accordance with the agreement of the parties, or, failing such agreement, was
not in accordance with the law of the country where the arbitration took place
; or (e) the award has not yet become binding on the parties, or has been set
aside or suspended by a competent authority of the country in which, or under
the law of which, that award was made.”

E. CONCLUSION

There is no doubt that ODR shall succeed for the same reasons that e-commerce has.
It is convenient, cost effective and fast. It also ensures flexibility and freedom to the
parties and the arbitrators. However like e-commerce, ODR too is marked by the
same pitfalls – predominantly, conservativeness to change and a marked lack of trust
by law and society. Also, just like e-commerce, ODR cannot be completely free of the
tactile world and it is the lack of clarity on its integration with traditional mores that
has seeded the doubts slowing its permeation and usage.

It has been the endeavour of this paper to show the potential obstacles that may arise
when pursuing dispute resolution through ODR. The majority of the issues can be
resolved merely by “deeming” a juridical seat or place for the virtual arbitration. Also,
ODR can be conducted in a impure form to accommodate present-day formal
requirements by rendering the awards in writing with the signature (or digital
signatures) of the arbitrators.

15
Upon analysis, it is evident that only minor adjustments are needed for Indian law to
fully embrace ODR as a preferred mode of arbitration. There is already a very
positive trend towards embracing all facets of ODR in India and it is evident that this
trend will only strengthen with passing time.
****

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