The International Chamber of Commerce (ICC) Commission on Arbitration and ADR recently revised its Construction Industry Arbitrations Report Recommended Tools and Techniques for Effective Management. The revisions reflect the 2017 changes to the ICC Rules of Arbitration (the ICC Rules) and recent developments in arbitration practice and complement the ICC Commission on Arbitration and ADR Task Force’s Report on Controlling Time and Costs in Arbitration. The report is intended for arbitrators with little experience of the ICC Rules and highlights the tools available to them.
Construction disputes merit the ICC’s extra attention by virtue of their sheer complexity due to their technical subject matter, the diversity and intricacy of the specialised contracts commonly used, the complex interrelationships required to deliver construction projects and the often extensive evidence. The cost-effective, timely resolution of such disputes requires suitably knowledgeable arbitrators with good case management skills.
The report emphasises that there is no single ‘right’ way to conduct a construction arbitration: each case is different. At the outset, parties should consider carefully which arbitration techniques to apply. However, while parties have an important say on the ultimate process, arbitrators must stand ready to propose alternatives better suited to the circumstances and available resources to ensure an expeditious and cost-effective process. The report’s recommendations help arbitrators to achieve that goal. Here are the key recommendations:
- Check the parties have complied with the tiered dispute resolution clauses in the contract.
- Set a full agenda for the first case management conference (CMC) to ensure the procedural timetable is comprehensive and practical and allow for further CMCs, for example, to narrow the issues.
- Allow leeway in the timetable for settlement discussions and any slippage.
- Expect parties to provide a list of persons involved in the project, a chronology and a glossary of terms. Some arbitrators request a working schedule, recording each party’s case and what is disputed/irrelevant/undecided. (An electronic version is easy to update but its status must be clear.)
- Use the Society of Construction Law’s Delay and Disruption Protocol (2017) guide where appropriate.
- Ensure claimed amounts are explained and evidenced so that the respondent understands the financial claims.
- Control documentary evidence tightly: confine disclosure to documents necessary to prove the case/defence or explain the documentary evidence.
- Where several witnesses have information on the same subject, consider using ‘fact witness panels’ rather than taking single witnesses at a time.
- Clarify at the outset whether expert evidence is required – and, if yes, why, by whom and when it should be provided. Alternatively, an arbitrator could appoint its own expert.
- Check that expert evidence is confined to the agreed scope – perhaps by using an agreed statement of issues and facts upon which expert evidence is required or by requiring sight of parties’ instructions to their experts.
- Time manage the hearing either through agreement or by drawing up a strict and fair timetable.
- Require closing submissions in writing after the hearing provided they do not contain new evidence.
- Throughout the process, encourage settlement negotiations either through negotiation or ADR proceedings or by considering sealed offers.
The report runs to 30 pages and, while focused on the ICC Rules, is a useful read for all involved in arbitrations, not just arbitrators.