Facts and Trends in Dispute Resolution in Sweden and Finland

♬ Yeah i just need light
I need light in the dark as i search for the resolution
I need light in the dark as i search for the resolution…♬

Lyrics, music and recorded by: Jack’s Mannequin.

The “Roschier Disputes Index 2010 – Facts and Trends in Dispute Resolution in Sweden and Finland” has just been released. Roschier is a Finnish law firm with over 70 years of experience in Finland and Sweden.

This report offers an insightful look into trends of dispute resolution in Sweden and in Finland. This report is noteworthy in at least a couple of respects. The first is that respondents include not only General Counsel and CEOs, but also CFO’s, officers rarely surveyed on international commercial arbitration. The second is that it is rare for most of us to have a law firm undertake such a survey. The report provides a ‘look and see’ what is happening in other jurisdictions and allows us to compare and contract their (surveyed) experience to our (anecdotal) one.

The report mentions the uniqueness of the survey:

As for the rest of the world, most countries have never independently surveyed the general mood of their large and/or mid-cap corporations on ADR.

In terms of the major finding of the report:

[A] single conclusion stands out as the thesis of the report: despite the experiences with booming dispute resolution during the last downturn, no signs of a boom are as yet in sight. On the contrary, a majority of the companies surveyed have not experienced significant growth in the number of disputes and do not anticipate such growth over the coming years either.

From a social perspective, it is good news that the number of disputes have not grown despite the downturn in the economy.

But in terms of resolving the disputes that do occur:

Companies are also clearly interested in exploring alternative ways of resolving disputes. While only 14 % of all respondents say they have so far participated in mediation or another alternative dispute resolution process, this percentage may rise as companies continue to seek simplified dispute resolution procedures and flexible solutions.

This accords with the numerous articles written over the last while wherein corporate counsel have commented on the cost and delays in the litigation process. It also accords with the (perceived) sense that corporations are looking for less-expensive, faster and more creative methods to resolve disputes.

Roschier commissioned the preparation of a Disputes Index, an independent market survey focusing on practices and trends in dispute resolution, as seen by the largest companies operating in Sweden and Finland. The survey was done by TNS SIFO Prospera, one of the leading independent market research firms in the Nordic region. The survey was conducted between 10 May and 25 August 2010 on behalf of Roschier.

Speaking of the mood of these large and/or mid -cap corporation, two of the other major conclusions are worth noting:

The second most important conclusion is that corporations in Sweden and Finland are cost conscious, with an eye on cost cutting and improved cost management when it comes to conflict management and resolution. Conflict prevention is the buzz word over dispute resolution.

This appears to confirm Richard Susskind’s prediction in The End of Lawyers:

In Chapter 7, Susskind focuses on the concept of access to justice, which he defines as preventing legal disputes from arising in the first place. Thus he compares the work of lawyers to the work of medical doctors practicing preventative medicine.

The report further states:

Lastly, arbitration remains king in the international commercial ADR scene. All other dispute resolution methods remain marginal, including international commercial mediation.

Other key findings in the report:

• While arbitration is the preferred dispute resolution method overall and while most contracts refer disputes to arbitration, most disputes that materialize are tried in litigation.
• Despite the trends of globalization, Nordic companies still hold a strong preference for their own national law and local arbitration institutions.
• Decisive factors when choosing between arbitration and litigation include speed, confidentiality and cost.
• The credit crunch has had less effect on dispute resolution than expected – no signs of a counter-cyclical disputes boom are in sight.
• Future trends include greater cost consciousness, predictability concerning cost, and willingness to explore ADR/mediation.

This report holds important insights for those seeking to build a global Online Dispute Resolution system (such as the one being proposed by UNICTRAL). The Final Communiqué of the 2010 ODR conference in Vancouver, BC, for example, is one of the stepping stones towards a global ODR system for low-value consumer disputes that would address many of the concerns raised in the Roschier report, at least as they relate to international consumer disputes. It is part of the path as we search for a global dispute resolution system.