2013 ICCI Conference Istanbul

2013 ICCI Conference Istanbul
Energy Infrastructure Projects: Preventing,
Handling and Solving Construction Disputes
April 25, 2013

Overview
• Why are construction disputes
different
• How to address the specific
concerns
• What solutions are available
• What are the trends

Why are construction disputes different
• Construction projects involve a numbers of players,
chain contracts and are usually technically complex
• Disputes about quality of work and design,
additional work and causes for delay regularly arise
while a construction project is still ongoing
• It is critical that the project can continue despite the
dispute and that delay is minimized, yet evidence
needs to be gathered and preserved
• Cash flow needs of constructors/subconstructors/suppliers
must be accommodated

How to address the specific concerns
• Solutions for multi-party situations are necessary to
ensure a comprehensive dispute settlement
• A properly documented claims management is
critical to establish claims by the constructors
• Disputes need to be addressed early on to prevent
escalation and delay of the project
• Interim solutions by engineers/experts can balance
the interests of the players involved
• Deadlock on cash flow must be prevented to keep
sub-contractors financially going

What solutions are available I.
• The construction industry has developed a number of tools
to address the specific concerns
― Standard contracts
― Formal variation and/or claims management procedures
― Mechanisms to allow an early and/or interim resolution
of the dispute
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―
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Independent engineer
Dispute review boards
Adjudication
Expert determination
• Arbitration institutions have expanded their offering by
providing an ADR toolbox

What solutions are available II.
• The DIS ADR tool box in overview and its
relevance to construction disputes
― DIS Conflict Management Rules (2010)
― DIS Mediation Rules (2010)
― DIS Conciliation Rules (2002)
― DIS Rules on Expert Determination (2010)
― DIS Rules on Expertise (2010)
― DIS Rules on Adjudication (2010)
• The ICC ADR Rules

What solutions are available III.
• Contractual arrangements
• Providing solutions to multi-party disputes in
arbitration rules – the new Articles 7-10 of the
revised ICC Rules of Arbitration
― Joinder of additional parties
― Claims between multiple parties
― Multiple contracts
― Consolidation of arbitrations

What are the trends
• Focus is on dispute prevention and management
• ADR methods provide for useful tools to address
critical concerns during the execution of the project
• Arbitration remains the preferred method of
binding dispute resolution
• Construction companies as repeat-users of
arbitration push for increased efficiency – time and
cost – of arbitration proceedings