FIDIC publishes practice note on Dispute Avoidance

FIDIC has prepared this Practice Note to raise awareness of the dispute avoidance function of dispute boards for its Contract Users and Adjudicators and to ensure that best practice is adopted in the future. Avoiding dispute as early and as quickly as possible is in the best interests of the project, the parties, and those involved in a funding capacity, whether funding the project or funding the dispute resolution process.

In the Practice Note, 5 core tasks and techniques are mentioned which if followed will likely result in better awareness of the dispute board’s avoidance role and more successful avoidance of disputes. Please find a short summary below.

• Task 1: Raising the parties’ awareness of the dispute board’s dispute avoidance role as early as possible;
• Task 2: Building and maintaining trust with the parties;
• Task 3: Determining when/where dispute avoidance should ideally take place;
• Task 4: Identifying and communicating to the parties examples of matters that are appropriate for dispute avoidance
• Task 5: Identify the best form for dispute avoidance

Reference is made to the Practice Note for a further explanation of the abovementioned tasks and techniques.

Parties are encouraged to engage in dispute avoidance as early as possible and throughout the project, in order to achieve successful completion of the project, maintain amicable and successful business relations and avoid unnecessary additional costs of protracted disputes. The dispute boards should help the parties to achieve the above objectives.

Please download a copy of the Practice Note via this link.

If you have any questions about dispute avoidance and/or dispute boards, please contact our construction partner Jacob Henriquez FCIArb (j.henriquez@ploum.nl), who has firsthand experience with dispute boards, both as counsel to a party involved as well as a dispute board member.