Expert Proposes Dispute Board for Building Industry

GULF TIMES Saturday 17/10/2009 October, 2009

By Sarmad Qazi

An expert has called for all the construction contracts in the country to include provision for a ‘dispute board’ if contractors want ‘happy endings’ to their projects.

Speaking at a Society of Construction Law – Gulf (SCL), Wayne Clark, the contract co-ordinator for a leading global contractor (Bilfinger Berger) which has multi-million dollar contracts in Qatar, said that the success rate of dispute board is a significant 99%.

“If we desire happy endings to our projects then we should all call for dispute boards in our contracts,” Clark said.

“Used efficiently, the dispute boards are also advantageous in lowering expensive litigation, and arbitration. They also take less time when compared to litigation,” he added.

The American Arbitration Association (AAA) puts the success rate of its dispute boards at 99%.

Explaining the mechanism of the boards, Clark said first contractors should ensure to know the dispute clause at the tender stage and in the absence of a suggestion of a dispute board should request for one.

“They are usually made up of three members, rarely only one. The selection process includes each party (contractor, client) nominating one person both of who go on to nominate a board chair.”

The dispute board members should hold regular site visits for more interaction which allows identification of potential differences at a very early stage.

“In case of a dispute between the parties, the board uses multi-layered steps including holding joint meetings with all parties, followed by private meetings. There is also a ‘cooling off period’ where parties are obliged to at least make earnest attempt to an amicable settlement,” the expert noted.

“Throughout the mediation effort, the boards should encourage communication and ensure a relaxed atmosphere where common sense can prevail,” he added.

In case of a dispute board is unsuccessful in resolving a dispute, the matter is then taken to the local courts by the aggrieved parties.

Narrating the story of an international contractor which had a major infrastructure project in Doha up until 2009, but one that was eventually terminated towards the end by the client, Clark said there was no dispute board mechanism in the contract.

“Quite late in the process real differences arose. These differences then led to an untimely and premature end to the contract while damaging the relationship the contractor had with sub-contractors and all parties.”

“Had we had the dispute board mechanism the barriers erected by differences would never have been created or if they did could have been torn down,” Clark added.

SCL-Gulf aims to promote the study and understanding of construction law amongst all those involved in the construction industry in the UAE and Gulf region.