Dispute Boards > Types of DBs

There are generally two types of dispute board: standing and ad-hoc.

Under some forms of contract, the FIDIC Red Book for example, the dispute board is appointed at the onset of the project and paid a monthly retainer for becoming familiar with the project, the contract and for keeping abreast with progress and events. The board is further compensated for actual time spent during site visits and dealing with matters that are referred to the board. These are known as standing dispute boards. In other forms of contract, such as the FIDIC Yellow, Silver and Gold books, the board is appointed when either party wishes to refer a dispute and is usually referred to as an ad-hoc dispute board. An ad-hoc board once appointed may however, be retained to give decisions on additional disputes if the need arises.

Standing Boards vs. Ad-hoc Boards

Standing boards have several advantages over ad-hoc boards in that they will already be familiar with the contract, the project and the personnel when a dispute is referred to them. This obviously helps them to ‘hit the ground running’ and deal with disputes in an informed, efficient and timely manner because there is no learning curve. On the other hand, an ad-hoc board will need to be selected, appointed and will then require time to familiarise themselves with the project and circumstances before they can begin to examine the dispute. This is a process that is likely to take considerable time. Boards appointed at a late stage often come into the project too late to be effective in the avoidance, management and resolution of disputes during the course of the project, which is a major disadvantage of ad-hoc over standing boards.

The fact that standing boards are proactive, rather than reactive, which is not the case with ad-hoc boards, has been recognised by FIDIC and future editions of the forms of contract that currently contain ad-hoc boards will be amended to include standing boards instead.

Some forms of contract prescribe Dispute Adjudication Boards and in such cases, the board is required to give a decision on which the parties must act unless it is changed as a result of arbitration. Others prescribe a Dispute Review Board where the board provides a recommendation. The latter may be equally effective because essentially, the board will be giving their recommendation based upon the predicted results of arbitration.