Dr. Sherif EL-Haggan (cab@link.

net)

FIDIC Middle East Contract Users Conference

Abu Dhabi 24 25 February 2010

Adjudication

Dispute Resolution - Latest Developments

(Adjudication)

Statutory

Dr. Sherif EL-Haggan

Contractual

FCIArb, London / Ph.D., Sheffield University

Founder/Director, Contract Administration & Arbitration Bureau (CAB)
Professor, The American University in Cairo

The Dispute Board (DB) concept originated in the 1960s

in the USA in the form of a Dispute Review Board (DRB).

Contractual Adjudication - Dispute Boards

1996
FIDIC adopted Dispute Adjudication Board
(DAB)
replaces the Engineers quasi arbitrator
role (ICE Clause 66 + FIDIC Red Book Clause 67).

Contract Administration & Arbitration Bureau (CAB)

Dr. Sherif EL-Haggan (cab@link.net)

Dispute Review Board (DRB)

The DRB issues Recommendations with respect to any
dispute referred to it.

Types of Dispute Boards

If no party expresses dissatisfaction with a

Recommendation within a stated time period, the parties
contractually agree to comply with the Recommendation.

Dispute Review Board
DRB

Dispute Adjudication Board
DAB

If a party expresses dissatisfaction with the

Recommendation within such time period, that party may
refer the dispute to arbitration or the courts.

Combined Dispute Board
CDB

Dispute Adjudication Board (DAB)

The DAB issues Decisions with respect to disputes
referred to it.

Pending a ruling by the arbitral tribunal or at the court, the

parties may voluntarily comply with the Recommendation

but are not bound to do so.

The DAB has 4 main functions:

Visit the site periodically & become familiar with
project.

The parties must comply with Decisions without delay.

If a party expresses dissatisfaction with a Decision within a
stated time period, it may refer the dispute to arbitration or

Keep up to date with progress & problems.

Encourage the resolution of disputes.

to the courts.
If no party expresses dissatisfaction with a Decision within
the stated time period, the parties contractually agree to
remain bound by it.

Contract Administration & Arbitration Bureau (CAB)

When a dispute is referred to it, prepare a

Decision in timely manner.

Dr. Sherif EL-Haggan (cab@link.net)

The process encourages a win-win rather than a winThe existence of a readily available mutually acceptable

lose philosophy.

impartial board promotes agreement.

Decisions not implemented may form the basis for
Participants do not want to lose their credibility with the

negotiated settlements.

DAB by taking extreme positions.

DAB Decision is a condition precedent to the

Accumulation of claims is minimized.

commencement of arbitration proceedings.

The Decision is admissible in evidence in arbitration.

The Reasoning

They also serve who only stand & wait

Reasoning is an essential part of the decision.

Members serve even when they wait & become an

May persuade the parties that the DAB studied all

instrument of dispute avoidance or at least minimising the

relevant matters & reached a conclusion similar to that

outbreak of disputes.

which may be expected from an arbitrator.

Quotation from one of John Miltons sonnets (1673)

Contract Administration & Arbitration Bureau (CAB)

Dr. Sherif EL-Haggan (cab@link.net)

1. Engineer endeavours to reach agreement

(mediator?)

2. Engineers Fair Determination

FIDIC 1999 Suite

3. Adjudication

Multi-tier Dispute Resolution

4. Amicable settlement mediation?

then, if necessary,

5. Arbitration

Constructing the Team (1994)

(Sir Michael Latham)
Adjudication was given a boost following Sir Michael
Lathams attention to two serious problems:
1. poor cash flow due to delays in payment by employers

Statutory Adjudication

2. arbitrary unsubstantiated withholding of monies

Housing Grants Construction & Regeneration Act

(1996)

Contract Administration & Arbitration Bureau (CAB)

Dr. Sherif EL-Haggan (cab@link.net)

Provided the adjudicator:

The 1996 Act entitles a party to require that a dispute

1. has jurisdiction &

be immediately referred to adjudication.

2. has conducted the adjudication fairly

chances of a decision being set aside are remote

Courts decided that summary judgement could

be used to enforce an adjudicators decision.

Adjudication succeeded in preventing the party which

is in the stronger position from abusing that position

Macob Civil Engineering -v- Morrison Construction Ltd.

An adjudicators decision is enforceable by summary
judgement and shall not be stayed by a challenge that the
dispute is referable to arbitration.

Cases
Outwing Construction Ltd. -v- H. Randell & Son Ltd.
An adjudicators decision properly made should be complied
with fully and promptly,

Contract Administration & Arbitration Bureau (CAB)

Dr. Sherif EL-Haggan (cab@link.net)

A & D Maintenance & Construction Ltd. -v- Pagehurst

Construction Services Ltd.
The courts can not open up an adjudicators decision if the
adjudicator is properly appointed and stays within his remit.

Bloor Construction -v- Bowmer and Kirkland

If an arbitrator makes a clerical error, accidental slip or
omission when making his or her award, the arbitrator on
application of one of the parties is empowered under The
Arbitration Act 1996 to make a correction.

Grovedeck Ltd -v- Capitol Demolition

The court held that the adjudicator had no jurisdiction
because the contract did not fall within the definition of
construction contract as defined in the Act.

It was held by the court that an adjudicator would have a

similar power even though no such power was referred to
in the Act or the Scheme For Construction Contracts.

Fastrack Contractors Ltd -v- Morrison Construction Ltd

The main contractor contested the adjudicators jurisdiction

Homer and Burgess Ltd -v- Chirex (Annan) Ltd

The adjudicators award was not wholly unenforceable and

on the basis that there was no dispute.

It was the courts view that a dispute arose when a claim
had been notified and rejected. A dispute could be about
what sum was due rather than whether a particular amount

the court had to decide whether it should itself decide how

much of the adjudicators decision should be paid or refer it
back to the adjudicator.
On balance the court considered time would be saved in

was due.
The court held that the adjudicator had jurisdiction as a

referring the matter back to the adjudicator.

dispute existed between the parties.

Contract Administration & Arbitration Bureau (CAB)