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either because he is dead, mentally ill, is outside the UK, cannot be found or cannot reasonably be expected to recall the matters dealt with in the statement. As can be seen from the above, the admissibility of a business document depends by Clause 15 on its having been "created or received by a person" in the course of trade, etc. Presumably, as in Sophoc leous v. Ringer, the use of a computer to facilitate the document will not compromise the requirement that it be created or received by a person. 7

Conclusion The CCTA seminar concluded that Section 5 of the Criminal Evidence Act 1968 and Section 69 of the Police and Criminal Evidence Act 1984 could be repealed and computer evidence dealt with under the remaining provisions governing documentary records which are outl ined above. As a participant in the VERDICT project, The Report would be pleased to receive comments from any individual or organisation on these proposals. Your comments will be passed on to the CCTA and taken into account in the report currently being prepared. In doing so perhaps we should all be mindful of the comments of Circuit Judge Van Graafeiland in a case before the US Court of Appeals for the Second Circuit (Perma Research and Development v. The Singer Company, 542 F.2d 111 (1976) at p.121): '~Ls one of the many who have received computerised bills and dunning letters for accounts long since paid, I am not prepared to accept the product of a computer as the equivalent of Holy Writ. As Courts are drawn willy-nilly into the magic world of computerisation it is of utmost importance that appropriate standards be set for the introduction of computerised evidence".

Stephen Saxby

Footnotes

1. 6 Information Age No. 3 July 1984, "Computer Output and the Law" by Colin Tapper, page 131-133.

2. This is because the definition of "document" in Section 10 CEA 1968 includes "any disk tape.. , or other device in which.. . data.., are embodied so as to be capable of being reproduced therefrom".

3. The precise relationship between Section 4 and Section 5 is not altogether clear. Section 4 begins with the words "Without prejudice to Section 5" - statement compiled under a duty etc. is admissible. Does this mean: 1. that statements compiled under a duty are admissible but subject to the further requirements contained in Section 5 if they are computer statements OR 2. that computer statements admissible under Section 5 are not subject to the requirements of Section 4 OR 3. that recorded statements can be admitted by complying with the requirements of Section 4 or Section 5? It may be that 3 is correct since the draftsman, being aware that Section 5 made no requirement of personal knowledge, was anxious merely to make clear that the requirements of Section 4 did not affect the admissibility of statements under Section 5. He therefore prefaced Section 4 with the words "without prejudice to Section 5" and although he may not have considered the matter, he did not intend to exclude any computer statement that satisfied Section 4 alone. However Colin Tapper in Cross, Sixth Edition, page 498 while agreeing that interpretation 1 must be wrong, says: "on the other hand Section 5 is not expressed to be without prejudice to Section 4, so that it would appear that.., a computerised record which fails to fulfil the requirements of Section 5, but does satisfy those of Section 4, remains inadmissible".

4. The Law Society's Gazette 21st March 1984 page 831.

5. Section 6 (3) (c) lists a number of factors going to weight with reference to statements admitted under Section 5: ie whether the information was supplied to the computer contemporaneously with facts dealt with in that information, and whether the supplier or operator had any motive to conceal or misrepresent the facts.

6. Different interpretations are offered as to the relationship between Section 68 and 69. It may be right to interpret Section 68 as saying that documentary records, subject to certain conditions, are admissible but that this is subject to Section 69 which requires all computer produced documents to meet the conditions set down in Section 69. Colin Tapper in Cross, Sixth Edition, page 560 argues that because Section 69 is in negative form (ie that a statement in a document produced by a computer shall not be admissible as evidence of fact unless... ) and because Section 68 is made subject to Section 69, that it follows any hearsay statement produced by a computer must satisfy the requirements of both sections.

7. These comments must be qualified by the submission that the relationship between Clause 15 and Section 69 PACE is not very clear. Clause 13 seems to preserve admissibility under Section 69 PACE so is Clause 15 apt to cover computer evidence?

NEW APPROACHES TO DISPUTE RESOLUTION

SETTLING DISPUTES BY ARBITRATION - IT'S CHEAPER THAN GOING TO COURT

Many people who become involved in a dispute, whether with a friend or neighbour over a domestic matter or with a builder over unsatisfactory work, or a supplier over an unsatisfactory product, are reluctant to take the matter to court for fear of becoming involved in the process of litigation. However, there is an alternative to litigation which is not only simpler and less daunting, but can have other substantial advantages. It is called arbitration. Arbitration simply means that you and the other person involved in the dispute agree to refer all the facts to an independent third party to decide it for you. It must not be confused wi th mediat ion or conci l ia t ion, where an independent third party tries to help the parties to resolve their dispute for themselves. Nor must it be confused with the

situation where the parties refer their dispute to a third party for his views but do not agree to accept his f indings if they do not agree with them. That kind of attempt at dispute resolution is often mistakenly referred to as arbitration, part icularly in the field of industrial relations. The essential feature of true arbitration is that the independent third party - the arbitrator - will hear the case presented by each party and then make a decision which the parties have agreed in advance to accept as binding upon both of them. Indeed, an arbitrator's decision may be taken to court and enforced if need by in the same way as a decision of a judge in litigation. The process of arbitration has existed in the United Kingdom for hundreds of years. Since the first Arbitration Act was passed in 1698 it has been fully recognised by, and supported by, the courts. Most arbitrations in England and Wales are now governed by the Arbitration Acts of 1950 and 1979. To come within the Acts the agreement to refer an exist ing or

MAY - J U N E T H E C O M P U T E R LAW A N D S E C U R I T Y R E P O R 1

future dispute to arbitration must be in writing, but it may be contained within a contract as one of its terms or may be a separate agreement on its own. There are a number of benefits to the parties in submitting their dispute to arbitration rather than litigation.

• The proceedings are private and confidential in contrast to litigation proceedings held in open court.

• The procedures in arbitration are flexible and can be adapted to the needs of the parties and the nature of the dispute much more easily than in litigation.

• The timetable for arbitration can be arranged to suit the convenience of the parties; for instance hearings can be arranged at unusual times such as in the evenings or at weekends.

• The process of arbitration can therefore be much quicker and cheaper than litigation if the parties co-operate with the arbitrator to make it so. For instance the arbitration may proceed on the basis of written submissions and documentary evidence with no need for a formal hearing as in court, or the hearing if there is one may be relatively informal. The sole criterion is that the parties have a full oportunity to present their respective cases to the arbitrator so that he can understand the dispute and make a proper decision.

• The parties can choose their own arbitrator by agreement to suit the particular dispute. Some standard forms of contract provide for the appointment or nomination of an arbitrator by some outside authority, for instance the President of a public institution such as the Law Society or the Chartered Institute of Arbitrators if the parties cannot agree on an arbitrator, and the parties to a dispute can make a similar arrangement between themselves if they cannot agree or do not themselves know of a suitable arbitrator.

• The arbitrator can be an expert in the particular kind of dispute so that the need for expert evidence may be much reduced or eliminated altogether with a considerable saving in cost.

• The parties, if they do not wish to present their cases themselves, may be represented by anyone of their choice - representation is not limited to lawyers as it is in the Courts, so that the parties may be represented by experts in the particular kind of dispute with a further saving in the need for expert evidence and therefore in cost.

• The arbitrator's award is final and binding and subject to appeal only on points of law and not of fact.

The Chartered Institute of Arbitrators is the only institution in the United Kingdom which specifically trains people to act as arbitrators in the whole field of possible disputes. It maintains a panel of arbitrators in a wide range of professional, commercial and industrial expertise from which a suitable arbitrator may be selected, and admittance to the panel, unless the person is of such eminence as to make it unnecessary, is by a rigorous process of training and examination so that those listed are fully trained and expert in arbitration as well as in their primary business or profession. If a contract so provides, or the parties to a dispute so agree, the President of the Institute will actually appoint an arbitrator for the parties. Alternatively the Legal Adviser of the Institute is always prepared to suggest names of suitable people from whom an arbitrator may be chosed by the parties themselves.

Further details of the Institute and of the services which it provides may be obtained from the Secretary, the Chartered Institute of Arbitrators, 75 Cannon Street, London EC4N 5BH (telephone 01-236 8761). John Sims FClArb., FRICS. Mr Sims is a Fellow of The Chartered Institute of Arbitrators and practices as a Chartered Quantity Surveyor in London.

SETTLING DISPUTES IN THE COMPUTER INDUSTRY

It can be argued that the computer industry has been too successful and too innovative, resulting in an outbreak of litigation particularly in the USA. Look-alike software cases, plug-compatible suppliers v. manufacturers, or manufacturers w third-party maintainers; all are a direct consequence of the industry's achievements rather than its failures. Innovation is a significant problem in itself because new developments are often more than simply new products - they can involve new services, new ways of doing business and new commercial risks. Often it is so rapid that the law has no opportunity to lay down precedents, nor the industry to develop codes of practice, before new technical developments demand reconsideration of whatever little has been achieved. If we want satisfactory ways to settle disputes in the industry, we must begin with a recognition of the speed with which the industry changes.

Where have all the profits gone? Less than fifteen years ago, only the largest companies could afford a computer. It was a considerable investment and it was served by a legion of company staff who wrote programs for it and who were themselves responsible for how well the computer served the business. The computer manufacturer often provided full-time support staff, free with a larger machine, and he still made a handsome profit. Moreover, his commercial risks were quite small - it needed an obvious mistake before it was apparent that a fault was indeed hardware rather than a programming error. Those times are past. Technological innovation and commercial competition have turned yesterday's low volume manufacturers into mass-producers serving a high volume market. The free support staff have disappeared - now everything has to be paid for because the industry's profits are being eroded. Hundreds of companies are putting together components to make computers to compete with the old established full-system manufacturers. Plug-compatible manufacturers compete to supply the terminals, disks and printers. Third-party maintenance companies seek to take what has, until recently, been the high performance part of the manufacturers' profit and loss accounts. In addition to all of that, it is increasingly important how the computer salesman uses his time because he is in a double squeeze. His target revenue is continually increased while the unit cost of equipment is falling. Every sale must therefore be achieved under time pressure and to beat last year's average time per sale. As a result, the quality of sales staff falls - who would want to be a computer salesman under these conditions? At the same time, the lower cost of machines means that many customers are small companies with little experience of computing. The less competent customer and the less competent salesman often create business transactions with interesting legal consequences.

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