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Assessing Credibility in Online Arbitration Hearings: Determining Facts and Justice by Zoom

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Abstract

The COVID-19 pandemic has led to the widespread use of online hearings in arbitral proceedings, raising questions about the impact of such proceedings on the determination of facts underlying a dispute. This article explores the extent to which online hearings may hinder arbitrators’ ability to assess witness credibility by drawing upon the cognitive psychology literature on truthfulness determination and lie detection. A survey of the literature suggests that the ability to differentiate truthful from dishonest statements through verbal and nonverbal cues is limited, leading to the notion that observing behaviors like fidgeting, gaze aversion, vocal pitch, or body posture is not particularly relevant in assessing the credibility of a witness. Instead, focusing on the content of what is reported appears to be the most relevant strategy to determine credibility. Therefore, research does not support the idea that face-to-face contact with witnesses is essential to determine the facts of a dispute. Still, the use of in-person hearings may, in practice, continue to be preferred due to underlying cultural assumptions regarding the nature of hearings, the facilitation of communication between parties, counsel, and the tribunal, and a general sense of Zoom fatigue.

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Notes

  1. Online hearings are not the only aspect of an arbitral proceeding that may take place online. Several different steps, such as the selection of arbitrators, case management meetings and exchanges, and arbitral tribunal work meetings may take place virtually. Still, given their centrality in an arbitral proceeding, online hearings are accorded greater concern compared to other procedures. See [4].

  2. Literature exploring an arbitral tribunal’s authority in the context of online hearings has discussed whether online arbitration procedures conform to due process principles, to what extent they affect the fairness of decisions, and if arbitral awards made after the usage of online hearings are enforceable pursuant to Article V of the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards. See, for example, [1, 6,7,8].

  3. See [10, 32, 71]. Specifically, some have argued that the ability to observe the hand and feet fidgeting of witnesses during online hearings may be impeded by limitations in camera angles and image clarity [10].

  4. In this context, listening to the testimony refers not only to its content, but also listening to how the information is verbally conveyed. See [10].

  5. This is usually referred to in legal circles as observing a witness’s demeanor. For example, as is described in one arbitral award: “The court has also considered in detail the detailed written and oral submissions made by both the applicant and respondent, together with the evidence of the respondent. The court has had the opportunity to observe her demeanour and access her credibility.” See [26]. Similarly, when discussing a claimant’s request to strike a witness’s statement, another international arbitration award noted that, “The finder of fact can observe the witness’ demeanor, assess their credibility, and thereby determine the veracity of their testimony - or the lack thereof.” See [27].

  6. This is an evolution that may in the near future be even more radically transformed by the prevalence of all manners of digital evidence in proceedings and the introduction of AI components of legal decision making. See [80].

  7. The 2021 QMUL Survey described the increase in the popularity of virtual hearing rooms as “an explosion” and underlined that the “pandemic has served as a catalyst to hasten the wider awareness and acceptance of it.” See [15].

  8. Notably, publicly available data from the International Centre for Settlement of Investment Disputes (ICSID) indicates that virtual meetings accounted for approximately 60% of all hearings in 2019 [17]. The rate is even higher at the Hong Kong International Arbitration Center (HKIAC), where in 2022, 75 out of 93 hearings were held fully or partially online [18].

  9. For example, the International Chamber of Commerce (ICC) added a new item in Article 26 in the 2021 ICC Arbitration Rules: “The arbitral tribunal may decide, after consulting the parties, and on the basis of the relevant facts and circumstances of the case, that any hearing will be conducted by physical attendance or remotely by videoconference, telephone or other appropriate means of communication.” See [21]. In addition, the 2022 ICSID Arbitration Rules added that “Before the first session, the Tribunal shall invite the parties’ views on procedural matters, including: …(f) the place of hearings and whether a hearing will be held in person or remotely”, a topic not addressed in the 2006 Rules. See [22, 23].

  10. A recent case from the ICDR, which involved a large number of witnesses who were located outside the United States (making it difficult for them to attend an in-person hearing), shows how parties and the arbitral tribunal often reach agreements to undertake the hearing online. To address this challenge, the parties agreed to explore the option of conducting a virtual hearing, and the arbitral tribunal and parties ultimately reached a consensus on this approach, with the tribunal noting that “Notwithstanding any circumstances arising from the pandemic (including restrictions on mobility that could affect the parties in disparate degrees), each party had an equivalent opportunity to present and take evidence through a secure and sound digital platform.” See [28].

  11. For instance, the Svea Court of Appeal’s case Bergsala SDA AB v ICA Sverige AB, where the claimant argued in the appeal that the use of an online hearing infringed upon his right to a fair trial and the right to an oral hearing, demonstrates how courts have supported online hearings. In this case, the claimant contended that the virtual hearing procedure was inadequate for assessing the credibility of witness testimony, which constituted a violation of due process. The Svea Court of Appeal held: “At the time of the main hearing it was ordained, and at any event it was allowed, that main hearings in arbitration proceedings may be held using technical tools…Nothing has been presented to alter the conclusion that the technical circumstances were acceptable, that the parties have been heard and have been able to communicate with each other, the arbitral tribunal and the invoked witnesses…In sum, the Court of Appeal concludes that the arbitration observed due process. The parties have been granted opportunity to argue their respective cases to a necessary extent. The dispute was managed impartially, purposefully and promptly. Thus, no procedural errors have occurred with respect to the above matters.” (unofficial translation, see [29]). Similarly, in an opinion and order of the United States District Court for the Southern District Of New York it was stated that “…Even if the Arbitrator had in fact refused to adjourn the hearing and only allowed Montemurro to appear by video, this would not have constituted a deprivation of Azimuth’s right to a fundamentally fair hearing.” See [30].

  12. Data from the Global Deception Team indicates that 71.5% of respondents worldwide believe that liars avoid eye contact, 65.2% believe that liars shift their posture more than usual, 64.8% believe that liars touch and scratch themselves, and 62.2% believe that liars tell longer stories than usual. See [33].

  13. As stipulated by jury instructions in the United States, “in deciding what testimony of any witness to believe, … consider the manner of the witness while testifying.” See [38].

  14. For example, see [11, 14]. This is seen namely in appellate courts being typically reluctant to modify factual findings, with civil procedure systems generally taking into consideration that first instance courts are able to directly observe the behavior and expressions of witnesses during the presentation of evidence. See [11].

  15. As stated by Circuit Judge Frank in a case before the United States Court of Appeals, Second Circuit: “The demeanor of an orally testing witness is always assumed to be in evidence. It is ‘wordless language.’ The liar’s story may seem uncontradicted to one who merely reads it, yet it may be ‘contradicted’ in the trial court by his manner, his intonations, his grimaces, his gestures, and the like — all matters which ‘cold print does not preserve’ and which constitute ‘lost evidence’ so far as an upper court is concerned.” See [39].

  16. See [54]. For instance, empirical studies have demonstrated that salespeople excel at regulating and exhibiting facial expressions and body movements that the customer expects. See [60, 61].

  17. See [60]. This vulnerability of observers may be a result of different people being good at acting, having a mental illnesses associated with emotional perception disorders, or possessing a habitual tendency to lie. Specifically, good liars (also called natural performers in some research) are usually good at using eye contact, leaning forward, smiling, and producing appropriate gestures to aid in the delivery of a message to disguise any lie and conceal their deception from the observer. See [53, 54].

  18. On the difficulties of separating emotion from reason in a legal decision-making context, see [81].

  19. As one case mentioned, “In this case most of the evidence was given by witnesses not speaking their first language and some through an interpreter. In such cases demeanour can rarely assist in deciding where the truth lies. In Kairos Shipping v Enka, The Atlantik Confidence [2016] 2 Lloyd’s Reports 525 at paragraph 11, I said: ‘First, a fact-finding judge can gain little from the demeanour of a witness when the witness is foreign, comes from a different culture and does not give evidence in his first language or does so through an interpreter;’ see The Business of Judging by Tom Bingham at p.11. In The Ikarian Reefer at p.484 lhc para. (4). Stuart-Smith LJ said that ‘most experienced judges recognise that it is not easy to tell whether a witness is telling the truth, particularly if the evidence is given through an interpreter.’” See [74].

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Acknowledgements

The Authors would like to acknowledge the support of the University of Macau RSKTO MYRG Grant and the Tashkent State University of Law (TSUL) CARL Fellowship. The Authors would like to thank the reviewers for their thoughtful comments towards improving this manuscript.

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Moreira, J.I., Zhang, L. Assessing Credibility in Online Arbitration Hearings: Determining Facts and Justice by Zoom. Int J Semiot Law 37, 887–901 (2024). https://doi.org/10.1007/s11196-023-10046-7

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