Fascinating concept that potentially can work: private arbitration is a matter of contract, there is nothing in law limiting the ability of parties to agree to be legally bound by a determination reached by a private party (i.e., arbitrator) with whom they contract to make such a decision, and the law provides well-established enforcement mechanisms by which arbitration awards can, if necessary, be taken to court and converted into judgments without too much fuss.
Judge.me also seems like it has taken a credible first cut at a form of execution that is at least workable. It has avoided the very thorny choice of law issues that can arise where the contracting parties are in different locations by essentially having the parties agree up front to be legally bound by what amounts to a free-floating form of law to be applied by the arbitrator regardless of what technical choice of law issues would normally prescribe. It has avoided the problems that can arise with discovery procedures in arbitration by limiting the whole arbitral process to a 1-day to 3-day exchange of evidence by email exclusively. It has also kept processing costs low by reserving for itself the right to choose and assign the arbitrator, by drawing its arbitrators from an established pool as contractors, and by dispensing with the need for witnesses, transcripts, rules of evidence, and all other technical aspects of judicial hearings (again, the parties agree up front to these limitations and that is why they can be legally bound by them even though they are highly unusual by court standards).
What all this means is that this is an innovative way to extend technology to dispute resolution but it will, of course, only appeal to those who can abide by the limitations. To me, this means that the system may lend itself well to small-dollar disputes but not to anything involving complex facts or larger claims. The absence of live testimony and the absence of discovery are particularly limiting in this context - if you can't find out too much about what the adverse party is going to claim and if you can't get your hands on evidence he holds to rebut it, you may be severely prejudiced. At some point not too far up the dollar scale, this likely becomes too risky (this would depend on the individual facts of a case). Beyond this, arbitration generally does not fit too well into non-monetary claims and judge.me would not be an exception to this. Still, for small-dollar cases, it would seem to be an interesting alternative to the small claims court systems in place throughout the U.S. and elsewhere.
The big challenge here will be to see how technology can be used to allow the service to overcome some of the limitations noted above while still keeping it streamlined and cost-effective. I am not sure this can be done but this is an interesting first step and there clearly would be a huge demand for cost-effective handling of claims at a higher level. It will be fascinating to see how this develops.
Thank you for this great review, but could I please correct you on one point: Parties can submit evidence in attachment to their email testimony. If they feel a need for spoken testimony, they can upload a private YouTube video and include the link in their testimony as well.
"the law provides well-established enforcement mechanisms by which arbitration awards can, if necessary, be taken to court and converted into judgments without too much fuss."
What I heard from another entrepreneur in this space (there are several competitors) is that small claims court is effectively not legally binding in most jurisdictions, because very few judges are going to issue a bench warrant or seize your house even if you blatantly don't pay the judgment against you. So even if there is a contract here, it doesn't seem like this would be any different unless there is enough money at stake that it's ultimately no longer under the small claims umbrella if the contract gets violated.
You don't need to arrest someone or seize property. You can just put a lien on it, which is a recorded document that you are legally entitled to be paid first if the person sells their house property, or you can garnish the person's wages or bank account.
If you win a small claims judgement, you have options to pursue collect yourself, like having a lien placed on their house, or having wages garnished. You're right in that it's not like the court will proactively help you collect, but there are tools at your disposal so that a judgement is valuable.
If people on the losing side of a small claims decision are willing to ignore it, why would they be any more likely to abide by the result of a judge.me decision?
(edit: re-reading what you wrote, I think that is your point)
Judge.me should have a public list of shamed people who haven't paid their bills. If it gets big enough this might be relevant, people might look at judge.me to see if a person they do business with is reputable. Or maybe it could somehow be reported to the credit bureaus.
Another one is if Judge.me holds the potential payments in escrow before the judgement takes place.
User profiles are indeed the long term goal. This would result in a pure private law instead of the hybrid model we have now where we still need government courts for enforcement.
Just so you know - your 'How it works' page contains a large number of phrases that you presumably intended to mark [as links] bu which aren't links. Looks a bit odd.
Also note that this is arbitration, which is one way a dispute might be settled. Another possibility is that a court will order a mediation, which is not quite the same thing. In a mediation, a neutral third party facilitates a negotiated settlement between the two parties, but has no power to dictate the outcome. In fact a mediation can conclude with no agreement, in which case the next step is a trial or judicial decision (or maybe an arbitration? I suppose it depends on how the contract is written).
Judge.me also seems like it has taken a credible first cut at a form of execution that is at least workable. It has avoided the very thorny choice of law issues that can arise where the contracting parties are in different locations by essentially having the parties agree up front to be legally bound by what amounts to a free-floating form of law to be applied by the arbitrator regardless of what technical choice of law issues would normally prescribe. It has avoided the problems that can arise with discovery procedures in arbitration by limiting the whole arbitral process to a 1-day to 3-day exchange of evidence by email exclusively. It has also kept processing costs low by reserving for itself the right to choose and assign the arbitrator, by drawing its arbitrators from an established pool as contractors, and by dispensing with the need for witnesses, transcripts, rules of evidence, and all other technical aspects of judicial hearings (again, the parties agree up front to these limitations and that is why they can be legally bound by them even though they are highly unusual by court standards).
What all this means is that this is an innovative way to extend technology to dispute resolution but it will, of course, only appeal to those who can abide by the limitations. To me, this means that the system may lend itself well to small-dollar disputes but not to anything involving complex facts or larger claims. The absence of live testimony and the absence of discovery are particularly limiting in this context - if you can't find out too much about what the adverse party is going to claim and if you can't get your hands on evidence he holds to rebut it, you may be severely prejudiced. At some point not too far up the dollar scale, this likely becomes too risky (this would depend on the individual facts of a case). Beyond this, arbitration generally does not fit too well into non-monetary claims and judge.me would not be an exception to this. Still, for small-dollar cases, it would seem to be an interesting alternative to the small claims court systems in place throughout the U.S. and elsewhere.
The big challenge here will be to see how technology can be used to allow the service to overcome some of the limitations noted above while still keeping it streamlined and cost-effective. I am not sure this can be done but this is an interesting first step and there clearly would be a huge demand for cost-effective handling of claims at a higher level. It will be fascinating to see how this develops.