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Dispute Resolution Board Foundation
Fostering common-sense dispute resolution worldwide
Dispute Resolution
Boards
An Alternative to
Arbitration and
Litigation
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Board Foundation
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The DRB Foundation
Nonprofit corporation
Formed in 1996
Created to promote the use of DRBs
around the world
Over 600 members from more than
thirty countries
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Board Foundation
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The DRB Foundation
Goals
Education
Public awareness
Networking
Historical database
Member & training directories
Newsletter, specifications & other
publications
International presence
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Board Foundation
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Development of DRBs
History
How do DRBs fit with other dispute
resolution processes?
Keys to successful conflict resolution
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Board Foundation
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What is a DRB?
3 reviewers
experienced
respected
impartial
Organized before construction begins
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Board Foundation
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What is a DRB?
Provided with contract documents
Becomes familiar with
project
participants
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Board Foundation
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What is a DRB?
Meets on regular site visits
with employer representatives
with contractor representatives
Encourages resolution of disputes at job
level
Holds hearings
makes recommendations
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Board Foundation
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How a DRB is Organized
Employer actions:
Evaluates applicability of DRB to this
project
Decides to use DRB
Includes DRB specifications and 3-party
agreement in bidding documents
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Board Foundation
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How a DRB is Organized
After contract award:
Each party nominates one DRB
member
Parties approve other’s nominee
First two members
review contract documents
select third member
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Board Foundation
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How a DRB is Organized
Third member approved and receives
contract documents
DRB is formally convened
3-party agreement is signed
Organizational meetings are held
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Board Foundation
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DRB Responsibilities
Periodic site-visits
Keep abreast of project activities and
developments
Encourage resolution of disputes by
parties
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Board Foundation
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DRB Responsibilities
When a dispute is referred
conduct hearing
complete timely deliberations
prepare a recommendation
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Board Foundation
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Costs of DRBs
Direct costs
$1000 to $2000 per day per member
Travel time and expenses
Indirect costs
Employee time in preparing for and
participating in DRB meetings
Considerably less than 0.5% of final
contract price
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Board Foundation
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Nine Elements of a Successful DRB
All 3 members are:
1.
2.
Neutral
Subject to approval of both parties
All 3 members sign a 3-party
agreement obligating them to serve
both parties equally and fairly
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Board Foundation
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Nine Elements of a Successful DRB
3.
4.
The fees and expenses of the DRB
members are shared equally by the
parties
The DRB is organized when the work
begins, BEFORE there are any disputes
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Board Foundation
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Nine Elements of a Successful DRB
5.
6.
7.
The DRB keeps abreast of job
developments by:
relevant documentation
regular site visits
Either party can refer a dispute
An informal but comprehensive
hearing is convened promptly
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Board Foundation
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Nine Elements of a Successful DRB
8.
The written recommendations of the
DRB are non-binding but admissible
as evidence later in
arbitration
litigation
to extent permitted by law
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Board Foundation
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Nine Elements of a Successful DRB
9.
The DRB members are absolved from
any personal or professional liability
arising from their DRB activities
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Board Foundation
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Perceived Barriers to DRBs
DRBs do not add value
DRB cost advantages include
potentially lower bids, better
communication on the job site,
resolution of issues at job site level
and fewer end-of-project claims,
lower total contact completion cost
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Board Foundation
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Perceived Barriers to DRBs
DRBs impose their own concepts of
fairness and equity
Standard three-party agreement
requires the DRB to comply with
applicable laws and contract
provisions. Standard three-party
agreement requires the DRB to
comply with applicable laws and
contract provisions
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Board Foundation
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Perceived Barriers to DRBs
DRBs may promote claims
Has not occurred because contractor's
do not want to suffer loss of
credibility by submitting nonmeritorious claims
Lack of qualification or presence of bias
Parties must only accept Board
members who are totally neutral and
impartial
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Board Foundation
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Perceived Barriers to DRBs
Lack of qualification or presence of bias
Parties must only accept Board
members who are totally neutral and
impartial
Promotion of acrimony & posturing
Properly conducted, the DRB process
prevents or reduces acrimony
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Board Foundation
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Perceived Barriers to DRBs
Lack of legal procedures & standards
Extensive documentation and readily
available contemporaneous witnesses
minimize factual disputes
Probing questions from experienced
Board members
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Board Foundation
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Application to Types of Construction
Underground
Heavy highway
Buildings
Ports
Public projects
Dams
Power plants
Private projects
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Board Foundation
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Cost $avings and Other Benefits
Dispute prevention benefits
Dispute resolution benefits
Cost savings statistics
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Dispute Prevention Benefits
Tends to promote bilateral agreement
Facilitates positive relations
Facilitates open communications
Facilitates trust and cooperation
Minimizes aggregation of claims
Minimizes posturing
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Dispute Prevention Benefits
Encourages identification, evaluation
and dealing with claims in a prompt,
business-like manner
Focuses on early identification and
analysis, and prompt resolution
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Dispute Resolution Benefits
High resolution rate
Provides an impartial forum
Provides informal and rational basis for
resolution (political cover)
Parties are normally predisposed to DRB
proceedings
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Dispute Resolution Benefits
Reduces transactional costs
legal fees
consulting fees
Reduces lost productivity time
Better informed decisions
Lower bids because of lower bid risk
premium
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Board Foundation
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DRBF Statistical Database
1988 thru September, 2004
Total # projects
1237
Total value
$US89.7 billion
Recommendations issued
1418
Acceptance rate
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Board Foundation
97.79%
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Dispute Resolution Board Foundation
Fostering common-sense dispute resolution worldwide
Questions?
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Board Foundation
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Dispute Resolution Board Foundation
Fostering common-sense dispute resolution worldwide
Dispute Resolution Board Foundation
19550 International Blvd. So. Suite 314
Seattle, WA 98188
1-206-878-3336
USA(toll free) 1-888-523-5208
E-mail: [email protected]
Website: www.drb.org
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Board Foundation
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