The Contractual Arrangements Between the Parties and the Dispute Board

Previous blogs have dealt with the selection process for DAB members, what to look for when selecting members and how the impartiality of members is assured. So what happens when either the one-person DAB or the three-person DAB have been selected and they have agreed to serve? Well, as with most things in business, it is necessary to enter into a contract between the parties.

Sub-Clause 20.2 (Appointment of the Dispute Adjudication Board) of the FIDIC contracts has this to say on the subject:

The agreement between the Parties and either the sole member (“adjudicator”) or each of the three members shall incorporate by reference the General Conditions of Dispute Adjudication Agreement contained in the Appendix to these General Conditions, with such amendments as are agreed between them.’

So, the agreement is between three parties – each individual member and the Employer and the Contractor. This is known as a tripartite agreement and, in the case of a three-person board, there will be three individual agreements – one for each member.

The FIDIC contracts include the General Conditions of Dispute Adjudication Agreement within the Conditions of the main contract and also an annex entitled Procedural Rules. Also included are Dispute Adjudication Agreements for one, or three-person DAB’s. The agreements require some details to be completed such as the details of the Parties and the fees and this is the document that is signed by all three parties to signify agreement.

So, there you have it, it is a very simple process and FIDIC has very kindly provided all the paperwork for the contract to be compiled and the agreement to be completed.