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Intro: Hello and welcome to Arbitral Insights, a podcast series brought to you by our International Arbitration practice lawyers here at Reed Smith. I'm Peter Rosher, global head of Reed Smith's International Arbitration practice. I hope you enjoy the industry commentary, insights and anecdotes we share with you in the course of this series, wherever in the world you are. If you have any questions about any of the topics discussed, please do contact our speakers. Welcome to our Greener Arbitrations podcast miniseries platform where Reed Smith's international arbitration lawyers will be exploring the legal and technical issues involved in reducing the environmental footprint of arbitrations. I am Alison Eslick, an international arbitration lawyer at Reed Smith's Dubai office. And I am Vanessa Thieffry, an international arbitration lawyer at Reed Smith's Paris office. In these episodes, we will hear from leading arbitration practitioners and external speakers and discuss insights, news and trends relevant to greening arbitration and the challenges that are entailed. We hope you enjoy this episode.

Alison: Welcome back to another episode of Reed Smith's Arbitral Insights. I'm Alison Eslick and together with my colleague, Vanessa Thieffry. We are delighted to host the fifth episode of our Greener Arbitrations mini series where lawyers of Reed Smith debate how to reduce the environmental footprint of arbitrations. In 2022, Reed Smith launched an initiative to reduce the environmental footprint of our arbitrations. And we quickly identified the need to raise awareness both internally and externally and organizing a podcast mini series like this on Greener arbitrations appeared a really obvious tool to do that.

In the first four episodes, we address these topics: arbitration agreements and whether they should include sustainability measures, the campaign for Greener Arbitration's Model Green Procedural Order and whether it was unavoidable, the topic of hard copy submissions and whether they were a thing of the past, and witness and expert preparation and whether video conferencing can really truly match in person meetings. So if you haven't listened to the podcast yet, please do tune in. They're all available on Reed Smith's podcast channel, Arbitral Insights.

Vanessa: Thank you, Alison. So in this episode, we focus on the hard part hearings and more particularly whether in person hearings are worth their while. As compared to virtual hearings with the COVID-19 pandemic, we kept on arbitrating and the arbitration community got into the habit of virtual hearings. Although at first voices of concern and caution were raised in the aftermath of the pandemic. Virtual hearings remained and in-person hearings often have a drastic environmental impact. A case study recently revealed that for a given arbitration, the in-person hearing gave rise to 19 times the carbon footprint of a virtual hearing. Mostly because of the flights of the arbitrators, experts, counsel and witnesses, et cetera, all these people involved with the hearing to get to the hearing venue. So a few, few years back, let's take stock. Are in-person hearings still worth their while?

Short disclaimer, please note that for the purposes of these podcasts, our debaters have been assigned the positions that they are advocating. This is because we felt that topics would be better explored if one team fully advocated their position for or against the proposition. The debaters are thus role playing and none of the views expressed during the debates should be attributed to any of the individuals participating in the debates or Reed Smith or any of its clients.

Alison: With that said Vanessa, let's start. The first speaker of each team will make their arguments for and against the proposition and a second speaker will make a rebuttal. So the first speaker up is Ana Ulseth. Ana is an associate in Reed Smith's global Commercial Disputes Group in our Miami office. Her practice focuses on international dispute resolution across a myriad of sectors including complex litigation in state and federal courts as well as international commercial and investment arbitrations. Now, Ana is also an eager Reed Smith Greener Arbitrations ambassador. So, Ana, the floor is yours. Why are in person hearings worth their while?

Ana: Hello, everyone. And thank you Alison and Vanessa for the kind invitation to join you. I'm thrilled to be here discussing this pivotal topic. In-person arbitration hearings are worth their while. And when I say this, I rely on two main points. First, it is easier to safeguard due process concerns in in-person hearings. As we know, a hearing is one of the most pivotal important junctures in an arbitral proceeding. Generally, a hearing encompasses the exchange of arguments and evidence. The ability to be heard and mount your case or defense is a cornerstone of due process and the requirements of procedural equality and fairness permeates all faces of an arbitration. Article five of the New York convention sets forth limited grounds on which recognition and enforcement of an award may be refused. One of those grounds includes when a party is otherwise unable to present their case as a ground for refusal. Being able to present arguments and evidence in person significantly aids in the conduct of a proceeding that is compliant with due process principles and that helps to secure the sanctity of an award. Everyone from council to the tribunal has more control over the proceeding during in-person hearings. Things like cross examinations and breaks along with any last minute issues that may arise are easier to address when you have everyone in one room.

Now, due process or equality may be infringed upon by technological issues experienced by parties during a virtual hearing. For example, if one party is affected by technological issues but not the other this may infringe equality in an ongoing proceeding. Additionally, although the tribunal has the discretion depending on the arbitration agreement and applicable rules or treaties to assist the parties with the determination of whether hearings will be in-person or virtual. This raises potentially challenging questions regarding how the tribunal can make the right call when the parties are in disagreement. Some questions that might arise here are, how will the tribunal ensure that the decision making process is fair to both parties in determining whether to require in person or virtual hearings? What test can be applied and how will the burden of proof be taken into consideration to ensure the ruling is fair and equitable? At the end of the day as council, we have a responsibility to provide zealous advocacy and act in the best interests of our clients. Certainly, this includes preserving the sanctity of an award and indeed, this is more easily achieved in-person.

As to my second point which is closely related to the first, in-person hearings provide counsel with more control over the entire proceeding. Various surveys have shown that parties have trepidations about virtual hearings. These trepidations include beliefs that it is harder to concentrate during a virtual hearing than it is during an in person hearing, that virtual hearings may be less secure or confidential. But the impact of any witnesses cross-examination might be diminished by virtual hearings. And that if virtual hearings are to be widely used changes will be required to the civil procedure and arbitration laws of certain jurisdictions. Additionally, virtual cross examination may also not be helpful if there are audio or video distortions, freezing of images or time lapse. Certainly behaviors observed virtually can more easily be over-interpreted or simply erroneously interpreted. Moreover, as advocates, our opening and closing statements are physically and intellectually demanding performance tests. There is a tangible advantage to subjecting opposing counsel and witnesses to these demanding experiences in person. There is no question that virtual hearings are more comfortable for everyone but comfort is not our guiding principle. And while virtual hearings are certainly greener and better for the environment, we should only opt for them if and when it is in the best interests of the client and their case or defense.

Lastly, on this point, nonverbal communication is very challenging to understand in virtual hearings. Our job as advocates is to facilitate the tribunal's decision making process. A variety of studies has shown that a range between 55% to 93% corresponds with non-verbal communication. And this is facilitated in in-person hearings in the same room as the tribunal, the witnesses, the parties and the experts. In essence, to sum up my argument, the potential for connectivity issues, frequency of breaks and unexpected interruptions are higher with virtual hearings and have the potential to affect the due process of a proceeding.

Vanessa: That is a very strong argument. But let's see what our second debater, Mathilde has to reply. Mathilde is an associate in our Paris office and her practice focuses on international commercial arbitration, especially in the construction and energy sectors. She is a part of our Energy and Natural Resources Group. Matilde will now advocate the position that in-person hearings are not worth their while.

Mathilde: While Ana has made a compelling case for the enduring merits of in-person hearings, I will present the reasons why their benefits do not outweigh the virtues of virtual hearings. My starting point is maybe the most obvious downside of in-person hearings which is their environmental impact. International arbitration generally involves parties from different countries or continents. And in this context, virtual hearings minimize travel for all participants including arbitrators, parties, council experts witnesses and court reporters. They also eliminate the need for extra physical infrastructure such as venues and offices which typically contribute to a significant carbon footprint.

Second, contrary to what we can sometimes hear making an environmentally conscious choice in favor of virtual hearings does not have to go against efficiency, due process or the client's best interests. Nowadays, technological advancements have made virtual hearings effective and secure. We now have access to high quality video conferencing, secured through robust encryption mechanisms and cybersecurity measures as well as advanced tools for evidence presentation. These technological advancements are perfectly able to ensure the integrity and fairness of the arbitration process. Any concerns regarding technological glitches and data security can be mitigated through continuous improvement and investment in robust technology infrastructure. Furthermore, technology has evolved to bridge the gap in conveying nonverbal communication through, for example, uh video conferencing, screen sharing and advanced virtual collaboration tools. Virtual appearance can also be less intimidating for witnesses which may look for a more open and honest communication.

A third point in favor of virtual hearings, which may be more convincing to clients in particular is the fact that they allow parties to save time and costs. As we know, traditional in-person arbitration hearings can be very expensive. They add to the already significant legal costs, costs of travel, accommodation, meals, as well as the costs of renting the hearing venue. All these costs are significantly reduced in a virtual hearing. Virtual hearings can also save a considerable amount of time. They eliminate the travel time for all participants and substantially reduce the time spent on logistics and administrative matters such as securing venues, making travel arrangements and so on. Beyond this, the flexibility and convenience of virtual hearings means that they can be scheduled more easily and that they can be conducted more efficiently. For example, because they allow for the use of time saving tools such as simultaneous interpretation, shared screens or chat features. This reduction in time spent by arbitrators consulting experts also reduces costs for clients. And this decrease in costs also means that individuals or entities with financial constraints can participate without incurring travel and accommodation costs. This makes arbitration which is often considered expensive, more accessible as a dispute resolution method. So as demonstrated by these numerous benefits, the incorporation of technology into legal proceedings makes virtual hearings not only a formidable contender but the ultimate victor over in-person hearings.

Alison: Thank you very much, Mathilde. Wow. I mean, I find myself conflicted and agreeing with both Ana and Mathilde at the same time. So let's test these arguments further. We now move on to rebuttal. Uh and Chris Edwards will take the floor. Now, Chris is a council in our Dubai office and a member of the Energy and Natural Resources Group. He has over a decade of experience advising clients on the complete life cycle of construction projects and disputes across the Middle East, Africa and Asia. So Chris, I believe you will advocate for the affirmative.

Chris: Hi everyone and thank you to Vanessa and Alison for inviting me to join this podcast today. I want to start by addressing the presumed environmental impact of virtual hearings. And I think there are a number of assumptions that are made about the green credentials of virtual hearings and also in person ones for starters virtual hearings may still require travel, virtual hearings are rarely ever conducted from each person's home. Participants will often congregate across hubs. For example, arbitrators may sit together or the parties and their respective lawyers in their respective officers and equally travel for in-person hearings can be limited, for example, by appointing arbitrators, lawyers experts, all of those can be appointed on the ground in the location of the hearing. It's also an assumption to suggest that travel is necessarily polluting. You could take a Tesla, you could offset your carbon footprint of airplane travel or you could even walk and you may laugh at the latter. But I did walk to a hearing recently.

It's also a misnomer to say that you're necessarily eliminating the need for physical infrastructure. As I mentioned, previously, participants still gather physically and ultimately, in terms of the venue, the venue can deploy green practices. It's really a question of what those are in the specific location where you're sitting. For example, a venue in office, if those are chosen, could use a green protocol or green practices such as electronic bundles technology platforms to display evidence and the use of laptops instead of paper pats and no bottles. So it's not necessarily correct to suggest that eliminating the need for a physical office or venue would in itself be green or not green.

The next point in terms of environmental impact is the use of electronic bundles. It's often suggested that virtual hearings go hand in hand with electronic bundles. I don't think that's always the case. I've known arbitrators to request hard copies for virtual hearings and equally hard copies are often exchanged leading up to virtual hearings as well. I've also seen in-person hearings use the electronic bundles, in fact, if I think back to the last in-person hearing that I sat in with hard copy bundles it was almost 10 years ago. So technology has really changed in terms of in person hearings as well. In terms of some of the other points not relating to the environmental impact of in-person and virtual hearings I think there's an assumption that these technological advances in terms of virtual hearings are necessarily entirely effective and secure. Whilst there have been improvements, a virtual hearing cannot compete with an in-person hearing in terms of security. Participants still and also just generally, in terms of effectiveness, participants still struggle to navigate breakout rooms and find that pesky mute button and they will never be more secure than sitting together in a single room. On bridging the gap of nonverbal communication, nothing can beat sitting face to face as we found earlier when we were trying to put this podcast together, took us 10 or 15 minutes to start.

Finally on time and cost whilst hiring a venue may be more expensive. Again, this is not necessarily given and in any event, it's not generally significant compared to the overall cost that a party might spend on arbitration as a whole. In respect of time, I'd suggest that focusing everyone in one place can be much more efficient than virtual hearings, which often end up being scheduled across weeks or even months. So I think in terms of which is favorable, I think the general practice of in-person hearings is really returned to the scene and that in itself shows that that's the preference of practitioners at this stage. Whilst virtual hearings have their place in terms of, for example, things like CMCs, full blown hearings are still best in person.

Vanessa: Thank you, Chris. There were some strong points in there, fun points and real arguments to each side. We still have one last speaker who may actually help to the scale. James Willn. James will rebut Ana's arguments that in-person hearings are worthwhile. James is a partner in our Dubai office and a member of our Energy and Natural Resources Group. He is an arbitration lawyer with more than 14 years experience and his practice centers on complex disputes and international arbitrations largely within the construction, the offshore oil and gas and other energy industries. In addition, James is recognized for his asset tracing and recovery litigation work as well as his work on contentious and non-contentious sanctions issues. So James, what is your answer to Ana?

James: Yeah, thanks. Thanks for that, Vanessa. No, that is really useful and um completely valid points and yes, having been through several hearings, uh interlocutory hearings CMCCs hearings during the COVID period. I can definitely say that they work um in that sense, there is some efficiencies there, time costs and savings. But I um I think where I come from is that real efficiency element of, of, of the of the virtual sense of things. So I, I see this quite a lot. Uh typically from barristers, I have to say who say, well, you know, virtual is fine um up to a point. But you know, you can't beat a good in-person, the whole witnesses the see the, the whites of their eyes and all that kind of stuff. And I, and I sometimes think that that's more about the drama than actually the rub of the dispute or, or getting to the actual evidence. Look, I love a good, full blown bluster hearing myself. You know, it's like a like a day trip to the theater, isn't it? The drama, the excitement, the tension, good witnesses, bad witnesses. Um It's, it's all good fun, but whilst we might be enjoying it as the lawyers and I know certainly some of the clients enjoyed it as well.

Ultimately, there's a cost there and with these more, bigger uh more global, more, more complicated arbitrations where, you know, the legal team is four or five individuals. Um The witness team could be six or eight, your expert team, two or three. And then even the client side could be three or four individuals um often from, you know, all around the globe. Um It's very rare that in an international arbitration, all parties are, are located in one jurisdiction. Uh notwithstanding that the seat of the arbitration might be somewhere completely different anyway, So in reality, you're talking travel, you're talking hotels, lack of management, time, uh key individuals away from their, from their day jobs. That that's a, that's a huge cost.

So for me, COVID taught me and, and I was as surprised as many that the the virtual hearings really do work. I did a huge multiparty, multidisciplinary, multi jurisdiction uh construction arbitration in the middle of, of COVID uh different languages, some Koreans in there, some Libyans, some Arabic speakers with the whole blown technology and it worked. And I think I was as surprised as many. So where I've seen complicated, difficult, complex time consuming arbitrations work in a virtual context, for me, notwithstanding the drama, the theater and the excitement, the reality is they are just as effective as the, as the in-person and obviously cost a whole lot less.

Alison: Thank you, James. Look, our time is up for this episode and we would like to warmly thank Ana, Mathilde, Chris and James for participating in this podcast. Stay tuned for episode six where we tackle perhaps the most important part of arbitration, uh besides the hearing, and that is the award. Our debaters will uh go head to head on the topic, Electronic signature and notification of awards: Is green always better? Until then thank you for listening to our Arbitral Insights, Greener Arbitrations podcast series. We hope you enjoyed it.

Outro: Arbitral Insights is a Reed Smith production. Our producer is Ali McCardell. For more information about Reed Smith's Global International Arbitration Practice, email arbitralinsights@reedsmith.com. To learn about the Reed Smith arbitration pricing calculator, a first of its kind mobile app that forecasts the cost of arbitration around the world, search arbitration pricing calculator on reedsmith.com or download for free through the Apple and Google Play app stores. You can find our podcast on Spotify, Apple, Google Play, Stitcher, reedsmith.com and our social media accounts at Reed Smith LLP on LinkedIn, Facebook and Twitter.

Disclaimer: This podcast is provided for educational purposes. It does not constitute legal advice and is not intended to establish an attorney-client relationship, nor is it intended to suggest or establish standards of care applicable to particular lawyers in any given situation. Prior results do not guarantee a similar outcome. Any views, opinions, or comments made by any external guest speaker are not to be attributed to Reed Smith LLP or its individual lawyers.

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