Virtual hearings: a practice under threat of disappearing?

June 2023 | SPECIAL REPORT: INTERNATIONAL DISPUTE RESOLUTION

Financier Worldwide Magazine

June 2023 Issue

Prior to the coronavirus (COVID-19) pandemic, it was unthinkable for most legal professionals to conduct a trial remotely (except in extraordinary circumstances), as they considered it essential for the parties involved – lawyers, witnesses, experts and judges, among others – to be present in the same courtroom to preserve procedural guarantees.

However, as the pandemic crisis wreaked havoc across the justice system, courts and tribunals were forced to adopt extraordinary measures to ensure access to justice, despite the limitations imposed by travel restrictions and the need for social distancing.

These extraordinary measures included holding virtual hearings.

In general, courts and tribunals responded remarkably well, and virtual hearings, which began as an extraordinary mechanism, proved to have many advantages, such as saving significant travelling time and costs, making for more expedient proceedings.

However, at the same time, virtual hearings have certain disadvantages (or even risks) that may impact on certain legal principles, such as the ‘principle of immediacy’, the guarantee of due process and the equality of arms principle. In the short term, many countries and arbitration institutions took steps to avoid (or mitigate) such disadvantages or risks. But it is clear that the wholesale adoption of virtual hearings requires careful thought as well as regulation to fully guarantee fundamental legal principles.

For example, significant concerns surround the examination and cross-examination of witnesses and experts during virtual hearings. Given that they are located in a separate venue and only visible through a web camera, anything located outside the camera’s range will not be captured. This poses the risk of external influence over a witness, meaning a witness could be coached off camera while giving evidence, whether by another witness, a legal assistant or any other unauthorised person.

In addition, conducting virtual hearings diminishes the power of courts and tribunals to sequester witnesses, which in turn increases the risk of a witness later tailoring his or her testimony to that of a previous witness.

There is also widespread concern that virtual hearings may limit the ability of courts and tribunals to evaluate witnesses’ credibility based on how they behave or react under questioning. Indeed, non-verbal cues (such as body language, glances and expressions) may be relevant, but the limited field of vision in virtual hearings makes it more difficult for judges and arbitrators (as well as lawyers) to pick up such nuances, which are visible in in-person hearings.

Finally, and especially in the context of arbitration, virtual hearings raise new concerns regarding confidentiality, which is one of the main reasons why parties decide to arbitrate their disputes.

Court litigation and virtual hearings in Spain

In Spain, as far as court litigation is concerned, the government, in a state of emergency during the pandemic, passed a Royal Decree on 28 April 2020 establishing that all courts should preferably hold hearings virtually for a period of three months. Later, on 18 September 2020, the Spanish Congress passed a law (Act 3/2020) on procedural and management measures to combat the impact of COVID- 19 on the justices sytem – extending the preference for conducting virtual hearings, except for criminal proceedings for serious offences (in which the physical presence of the accused was necessary).

Since these laws did not go into any further detail, in February 2021, the Spanish General Council of the Judiciary published a set of guidelines to shed some light on how virtual hearings should be conducted. In essence, these guidelines sought to establish a framework to guarantee due process, access to justice and confidentiality. The guidelines also outlined the technical requirements necessary for courtrooms to properly conduct virtual trials.

These guidelines were intended to be an interim solution. Although Act 3/2020 contained a provision whereby the government – with the collaboration of other state agencies – would undertake to submit a draft bill to Congress “for the regulation of virtual hearings preserving at all times the rule of law”, no subsequent legislation has so far been enacted. Thus, there is a legal vacuum.

This vacuum, together with the clear need to modernise the logistics and technology of the Spanish justice system, means that though the worst of the pandemic has passed, many courts are reluctant to conduct hearings virtually.

Indeed, in May 2022, following their annual conference, the chief judges of the Spanish Superior Courts of Justice issued a statement warning of the need for a specific, detailed regulation to govern virtual hearings. They pointed out that the provisions contained in Act 3/2020 and the guidelines issued by the Spanish General Council of the Judiciary are manifestly scant and vague. The chief judges called on the government to urgently comply with its promise to submit a draft bill to Congress “for the regulation of virtual hearings preserving at all times the rule of law”.

In this statement, and in line with the concerns expressed in other jurisdictions (especially in civil law jurisdictions where the ‘principle of immediacy’ has deep and strong historical roots), the chief judges advised that, contrary to the impression that may have been created during the pandemic, technological issues are not the only constraints that need to be addressed and resolved before virtual hearings become widespread. Rather, it was necessary to reflect on aspects that may be seriously compromised by the indiscriminate adoption of virtual hearings.

Specifically, the chief judges warned that in certain conditions, communication via virtual hearings may be less effective, negatively impacting judicial decisions.

The chief judges noted that, in any case, it was up to judges to decide whether a hearing would be held virtually or in-person, and always with the aim of safeguarding legal guarantees.

During 2023, two draft bills that may lead to developments in this area have been sent to Congress: (i) the draft law on Procedural Efficiency Measures for the Public Justice Service, which includes reference to electronic methods and promoting alternative dispute resolution mechanisms; and (ii) the draft law on Digital Efficiency Measures for the Public Justice Service, which focuses on technological aspects to modernise and increase the flexibility of Spain’s procedural system, including the use of virtual hearings.

Ultimately, time will tell whether these new measures (if approved) will overcome the courts’ current doubts (or even reluctance) to conduct virtual hearings. It should be noted, however, that such measures are very much in line with the chief judges of the Spanish Superior Courts of Justice’s statement of May 2022, which suggests that virtual hearings will most likely be limited to smaller cases (as well as plain procedural hearings), with in-person hearings for larger trials, and that courts will have the power to determine whether the hearing is held in-person on a case-by-case basis.

Virtual hearings in arbitration

In the context of arbitration, things are somewhat different. In fact, virtual (even telephone) hearings on procedural matters have been commonplace in domestic and international arbitration for some years. Along with the desire to achieve the speedy and efficient resolution of a dispute, this has meant that arbitration has quickly adapted to conducting arbitral proceedings remotely.

Most major arbitration institutions, both in Spain and internationally, have published protocols and guidelines explaining how virtual hearings should be conducted. These include the International Chamber of Commerce (ICC), the Court of Arbitration of Madrid (CAM), the American Arbitration Association (AAA), the Vienna International Arbitration Centre (VIAC), the Singapore International Arbitration Centre (SIAC), the Hong Kong International Arbitration Centre (HKIAC) and the China Economic and Trade Arbitration Commission (CIETAC), to name just a few.

These protocols and guidelines address – in varying degrees of detail – some of the key concerns previously outlined. For example, the ICC recommends that tribunals and parties agree on the possibility of “virtual sequestration” of witnesses. The HKIAC advises parties to arrange “for a hearing invigilator to attend at the same premises as the witness or expert. The SIAC suggests “requiring the witness to provide a 360-degree view of the room”. And all of them recommended ensuring the confidentiality and security of virtual hearings (including password protection, lists of participants and minimum requirements for encryption, among other aspects).

Despite the efforts of the arbitration community to adapt to a new reality, many arbitral proceedings are still held in-person. But it is likely that, in the future, virtual hearings for arbitrations will become the norm rather than the exception.

Cristina Camarero Espinosa is the managing partner, Antonio Góngora Oliver is counsel and Paula Fernández Huertas is an associate at ONTIER. Ms Camarero can be contacted on +34 (91) 431 3000 or by email: ccamarero@ontier.net. Mr Góngora can be contacted on +34 (68) 941 5548 or by email: agongora@ontier.net. Ms Huertas can be contacted on +34 (66) 948 4557 or by email: pfhuertas@ontier.net.

Cristina Camarero Espinosa, Antonio Góngora Oliver and Paula Fernández Huertas

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