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DRBs and the DRA
Fast and economic dispute
resolution for large projects
What is a DRB?
A Dispute Review Board (DRB) is a panel created at the
start of a project and empowered to make rapid decisions on any dispute that may
arise during the project. The
operating rules of the DRB specify whether its decisions are binding,
temporarily binding, or non-binding. Decisions
can be limited to factual (as opposed to legal) issues or can cover the full
range of issues.
If the decision is temporarily binding, it is so for a
definite period of time (for example, until performance of the contract has been
completed), but it can be challenged and reversed in subsequent binding
proceedings (such as arbitration).
How does a DRB work?
The key feature of a DRB is that its members are active
throughout the project and are not chosen after the dispute has arisen or,
worse, after the project has been completed.
DRB's make regular inspections of the work in progress and hold regular
meetings with the project teams. The
majority of issues brought to the attention of a DRB are technical, thus the
members should have a technical background.
Additionally, members need to be well versed in contract administration
and confident in their ability to understand and interpret contractual
Benefits of a DRB
Use of a DRB allows work on large, lengthy projects to
continue without their getting bogged down in litigation. DRB members are familiar with the work and can observe
problems as they arise. This avoids
the need to collect evidence months or years after the work took place.
Furthermore, problems surface early and usually don't fester.
When a DRB is in place, parties usually work hard to resolve potential
disputes themselves. Damaging and
costly "duels of egos" are avoided.
Do DRBs work in practice?
DRBs have been used in the construction industry around
the world for many years, with good success rates.
Among the examples worth mentioning are the DRB for the Channel Tunnel,
which successfully resolved most of the disputes submitted to it, and the DRB
for the new Hong Kong Airport Project (whose results have not yet been
What is a DRA?
The Dispute Resolution Adviser (DRA) is an individual
empowered to decide which dispute resolution technique should be used to resolve
any particular dispute. The DRA can
apply formal or informal facilitated negotiation, mediation, or accelerated or
normal arbitration procedures in order to facilitate settlement.
How does a DRA work?
The DRA is appointed at the beginning of the project,
visits the site regularly, and assists the parties to facilitate settlement of
any disagreements or disputes that may have arisen since the previous visit.
The DRA decides which dispute resolution process to apply to each
situation (that is, mediation, arbitration, or whatever).
Benefits of a DRA
Each dispute is resolved by the dispute resolution
process which is most likely to provide an efficient and effective resolution of
the conflict. By efficient we
mean a process that is fast and inexpensive.
By effective we mean a process that results in an outcome that reflects
the parties' legitimate business interests.
Do DRAs work in practice?
Use of the DRA is a recent innovation in the Hong Kong
construction industry. Early
experiences are favorable.
DRBs and DRAs are based on two key ideas: (1) disputes
can be resolved more efficiently and more effectively by people who are familiar
with the project from its inception, rather than by people who first learn about
the project only after a dispute has arisen; and (2) no one dispute resolution
process is optimal, so efficiency and effectiveness will be maximized if
different types of disputes are resolved by different processes.