McMullan Solicitors

Research Favours Use of Dispute Review Boards on Major Projects

Thu, 02 Jun 2011 14:24:06 +2200

The use of a Dispute Review Board (DRB) on major projects has substantial support on projects worldwide and in Australia. Several major world-wide standard form agreements now include DRB clauses. The statistics on the minimal number of disputes coming out of projects with a DRB is compelling. A number of academic studies have been published in this area. The substantive conclusion from the above is that DRBs are used widely on major projects, with great success in reducing construction contract disputes.

dispute-avoidance-boards-110602.pdf

Firedam Civil Engineering Pty Ltd v Shoalhaven City Council [2010] NSWCA 59 (19 April 2010)

Wed, 24 Nov 2010 10:57:37 +2200

In this case (for which leave has been given to appeal to the High Court), the NSW Court of Appeal made a declaration that an expert determination was not binding on the parties. MacFarlan J, in the principal judgment, reasoned that, there being an inconsistency in the reasoning of the expert, in making the determination he had made, and determining that the Principal had, in making variations, delayed completion, thereby entitling the Contractor to an extension of time, yet failing to the Contractor delay costs: “the Contractor can fairly say, as it does, that it has not been told by the Expert why it is not entitled to delay costs”. Macfarlan J concluded that, the expert, in failing to give reasons, had gone outside the expert determination agreement, accordingly: “A departure from the Contract having been demonstrated by the Contractor, the whole of the Expert Determination must therefore be regarded as being outside the contemplation of the Contract. The Contractor is thus entitled to a declaration that the Expert Determination is not binding upon the parties to these proceedings.”