The new Master of the Rolls, the Right Hon. Sir Geoffrey Vos, speaking at the ISDA Virtual Annual Legal Forum, has drawn attention to some significant developments in technology impacting litigation in England and Wales, asking us to ‘allow English law to do what it does best’ and embrace innovation. We consider the key points.
Litigation and arbitration in London
A key item on the agenda is the future of London as a centre for international disputes, which looks bright post-Brexit according to Sir Geoffrey - and we have the unique offering of London’s litigation offering and the judicial system’s ability to adapt to thank.
Recent examples can be seen in the test case concerning insurers’ liability for business interruption caused by Covid-19, which was heard in a record breaking 6 months by the Financial List and Supreme Court and Sir Geoffrey’s future plans for a universal online point of entry for civil cases.
Digital Dispute Resolution Rules
Also on the agenda are the draft Digital Dispute Resolution Rules, published by the UK Jurisdiction Taskforce (“UKJT”) in February 2020 as an attempt to adapt to new complexities emerging as a result of digital disputes. These aim to simplify and facilitate a faster and more cost-effective resolution in such disputes, says Sir Geoffrey. The UKJT’s public consultation on the rules has now closed and the final draft is expected soon.
Cryptoassets and Smart Contracts
Cryptoassets and smart contracts are another topic of interest, with the UKJT’s Legal Statement on the Status of Cryptoassets and Smart Contracts. In Sir Geoffrey Vos’ opinion, this 2019 statement represents a ‘ground-breaking’ view that cryptoassets are indeed property under English law, and ‘smart contracts’ are legally enforceable.
Digitisation of Commercial Records
The digitisation of records and documents has been a hot topic in recent years, with Sir Geoffrey calling recent developments ‘significant’. Recent advancements include the conclusion of the UNCITRAL Model Law on Electronic Records in 2017 (now implemented in 3 jurisdictions), which aimed to allow electronic transferable records to be utilised across borders.
The topic of electronic execution of documents was explored by the Law Commission in its report, published in 2019. The report, which considered the practical issues relating to practical issues relating to electronic execution is now under further consideration, including through an additional consultation paper which was published earlier this week.
Another development to consider is Lawtech UK’s research into the practical implications of machine-readable legal documents such as smart contracts.
All of these initiatives demonstrate how our legal system is, and must continue to, adapt to this rapid pace of technological change amidst the ‘new normal’.
We’ve all seen the headlines ‘robots to replace humans’ but are lawyers really about to be replaced with algorithms? Sir Geoffrey doesn’t think so. While it is clear that we are seeing more and more advances in this area, and automation requires careful governance to avoid issues such as bias, we shouldn’t be afraid of technology. Instead, we should embrace it in the knowledge that it will transform business and access to justice. The advantages of automation should be considered here, for example the ability to resolve disputes quickly and at a lower cost via online dispute resolution, which in turn will improve access to justice.
The developed state of our common law and consequent predictability of English law, as well as the efficiency of the judicial system, has long made the English jurisdiction attractive to foreign litigants. To some extent this has been eroded by the present state of uncertainty insofar as English judgments are not automatically recognised throughout the EU in cases where the claim was filed after 31 December 2020. In the coming month we will perhaps learn whether this may be put to bed if the EU supports the UK’s request to join the Lugano Convention. Failing this there remains a chance that arbitration (with the certainty of enforcement under the New York Convention) may become increasingly popular.
On the horizon
Finally, and with all that in mind, what should we be looking out for in the coming months?
- Digital Dispute Resolution Rules – we are expecting the rules, which bring change to digital relationships and smart contracts, to be launched in the next few weeks.
- Law Commission consultation on electronic documentation – following the Commission’s 2019 report on the same subject, a new consultation has been published seeking ideas on possible projects for legal reform. Themes include leaving the EU and emerging technology and automation, with possible projects including building on the existing work done by the Commission on electronic execution. The consultation closes on 31 July.
For more information on these and other key disputes issues, please contact a member of our Dispute Resolution team. Our team is ready to assist and, in appropriate cases, we can work with clients to reduce or avoid the costs of disputes through our LS Unlock initiative (for more information click here: Lewis Silkin - LS Unlock).
'I return, as I always do, to the plea that we should allow English law to do what it does best. It can and will adapt to ever changing commercial situations in the technological space.'