IN THE SUBJECT OF ALTERNATIVE DISPUTE RESOLUTION

PROPOSITION SET 1

GENERAL INFORMATION

1. The Republic of Indochini is a vast country in South Asia spanning diverse landscapes
from snowy mountains and lakes in the northern part, Chini to deserts and beaches in the
southern part Indo. Though the country has plenty of natural resources, due to centuries of
plunder and colonization by external agents, it has been underdeveloped and is currently
struggling to improve its economic situation. There has always been a socio-cultural
divide between the residents in Chini, which is the political capital and is home to the
relatively poorer peasant population, and Indo which is developing into a global
investment hub and where the majority of the country’s urban elite reside. Indochini’s
present ruling party was elected on a promise to reintegrate the two regions and build a
united Indochini which can use its combined powers to take on the world. The Prime
Minister, Mr. Mahendra Audi is only 35 years old, the youngest person to be elected to
this position. He is known to be a dynamic and charismatic personality.

2. Barely two months after being elected to office in 2014, Mr. Audi declared his intention
to build a bridge across the Doodhsagar Lake which separates Chini from Indo. If
completed, it would be the longest bridge in the world. Since the state coffers had an
insufficient budget, the government decided to enter into a Public Private Partnership
with Alliance Industries and form ‘Doodhsagar Works Pvt Ltd’ (‘Doodhsagar’). The MD
of Alliance Industries, and coincidentally, Mr. Audi’s best friend from Harvard Business
School, is Ms. Moksha Advani. Under the terms of the PPP agreement, Alliance would
provide the majority of the funding and logistical support for the construction of the
bridge while the government would provide all the necessary planning permissions from
its end to ensure successful completion of the project. Aasmaan Advani, Ms. Advani’s
younger sister and Mahendra’s fiancée, was designated as the CEO of Doodhsagar.

3. Not everybody was happy with this announcement. This was particularly because Mr.
Audi’s campaign agenda had included a promise to improve the conditions of Chini’s
peasant population. The rural voter base complained that this was just a ‘vanity project’
meant to further the interests of Indo-ian business elite. However, Mr. Audi assured the
 populace that the bridge would further the socio-economic and cultural reintegration of
the two regions.

4. Since Indochini had never undertaken a project on this scale before, Ms. Advani was of
the opinion that a foreign agency should be contracted for supervising the process.
Though firms from all over the world bid for the prestigious job, the winner was, in
another stroke of coincidence, Ms. Advani and Mr. Audi’s third best friend from Harvard
Business School, Ms. Emilie Ansari. Ansari is the managing partner of Ansari & Co
(‘Ansari’), Denmark’s leading engineering firm. Their website advertises that their work
is in ‘strictest compliance with European standards.’ Due to their geographical location,
the firm has extensive experience in designing and constructing bridges over water bodies
around the Scandinavian countries. Doodhsagar and Ansari entered into an agreement, the
clauses of which are summarized as follows:

4.1. The engineers of Doodhsagar and Ansari would work in joint collaboration. The
initial designs for the project would be provided by Doodhsagar because it is the
local company and had more knowledge about the area. However, Ansari was
responsible for making any structural improvements that it deemed necessary. Ansari
was also responsible for ensuring that the construction was carried out in accordance
with ISO standards.

4.2. In the event of any disagreement between the two parties over the design and
construction process, Ansari would have the right to veto.

4.3. The intellectual property rights in all designs would vest with Doodhsagar. Ansari is
not authorized to use the same for any other project without Doodhsagar’s prior
permission.

4.4. The construction of the bridge would take place in 4 phases lasting for 1 year each.
For each phase that was successfully completed, Doodhsagar would pay a fee of 2.4
million USD to Ansari.

4.5. In the event of any damage or delay in any phase of the construction process, Ansari
would be liable to forfeit its fee for that phase, as well as compensate Doodhsagar for
the costs incurred due to such damage or delay. Force majeure and contributory
negligence would be exceptions.
 4.6. In the event of a delay lasting beyond 120 days or any non-compliance with the
terms of the agreement, Doodhsagar would have the right to terminate the contract
and replace Ansari with another firm, provided the remainder of Ansari’s dues have
been paid. This is subject to the provisions of Clause 4.5.

4.7. Parties will strive to resolve any dispute arising out of the agreement through
negotiation within 30 days, failing which the dispute will be referred to the Singapore
International Arbitration Centre.

5. The construction process began on 31st January, 2015. Emilie Ansari personally took
charge of the project. The first three phases from 2015-16, 2016-17 and 2017-18 were
successfully completed. On 1st January 2019, just before the final phase was about to be
completed, and 4 months before Indochini General Elections, Doodhsagar engineers
noticed a crack in one of the foundations. They pointed out the same to their Ansari
colleagues. The matter was taken to Emilie Ansari, who advised them to repair the crack
and resume the project as usual. She purportedly said, according to Doodhsagar
engineers, that such things were normal in business. The Doodhsagar engineers felt that
the plan for the phase should be redesigned altogether. However, Ansari exercised its veto
power under the contract and the construction continued.

6. Unfortunately, on 8th January, 2019, the pillar in which the crack was spotted collapsed
(the ‘Incident’). 2 labourers and 1 engineer working for Doodhsagar lost their life.
According to Doodhsagar’s estimates, the cost of repairing the damage would be 600,000
USD. A notice was sent to Ansari asking them to pay the costs and redesign the
construction plan in accordance with what Doodhsagar had suggested earlier.

7. Ansari refused to take responsibility for the Incident. According to them the area was
prone to bad weather conditions that could have accelerated the collapse of the bridge.
They also felt that the initial plans provided by Doodhsagar were themselves flawed and
hence Doodhsagar was partly responsible for the collapse as well. Hence the force
majeure and contributory negligence exceptions were made out.

8. Doodhsagar sent another notice alleging that Ansari had failed to maintain proper
oversight of the process and that they had deliberately compromised on their promise of
European standards as the project was being made in a ‘lesser developed’ country. Ansari
argued that the agreement demanded ISO standards which they had complied with and it
was not their responsibility to ensure anything higher than that.
9. The parties have agreed to meet and commence negotiation over their grievances.
Doodhsagar will be represented by Aasmaan and the company’s General Counsel, Shlok
Patel, and Ansari will be represented by Emilie and the firm’s attorney Mr. Andre
Desportes.