Construction Claims + Disputes

As the construction industry has struggled to resolve disputes in a timely and cost-effective manner we have seen the rise of DRAs (Dispute Review Advisors) and DRBs (Dispute Review Boards) in an effort to resolve disputes “out in the field” in real time. Often a single DRA will be used on more modest sized projects, while a 3-person (panel) DRB will be used on larger or more complex projects.

Both DRAs and DRBs have been used with increasing frequency across the construction industry. These boards typically include independent experts whose job it is to oversee project events, and employ expertise and impartial judgment to make recommendations to parties about disputes on a construction project. While not legally bound, the parties frequently adopt the recommendations of the DRA or DRB.

The goal of DRBs is to settle disputes at the earliest opportunity at the lowest project level possible. The hope is that by resolving disputes quickly and informally, disputes will cause minimal disruption in the project and long-term relationships will be protected while legal fees and disruptions are minimized. Real time dispute resolution mechanisms like DRAs and DRBs have been very effective at achieving cost-effective outcomes without formal “lawyering up.”

Some of the advantages of the DRB process are:

• Parties are less likely to advance frivolous claims or defenses at the risk of losing credibility with the DRB.
• Board members continually monitor the project and readily understand developments.
• Board members get to know and understand the people involved and can facilitate trust and respect.
• Ongoing knowledge of the project and its participants gives credibility and support to the DRB’s recommendation.

The Ohio Department of Transportation (“ODOT”) has frequently used ADR processes such as DRAs and DRBs, and has done so since 2002. This is one of the reasons that ODOT has experienced much less litigation in the Court of Claims than other similarly situated state agencies doing a similar volume of construction work.

Studies have shown that DRBs have been positively received by project stakeholders and contribute to the success of a project. Resolution rates (avoiding litigation) of almost 99% have been reported.