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News & opinion

13 SEP 2018

Promoting consistent standards in construction disputes resolution

In recent years, the global construction industry has spent more and more on solving disputes, with the financial impact in the past two decades reaching billions of dollars.

According to the Global Construction Disputes report 2018 by Arcadis, the value of construction disputes in the Middle East last year was double the global average and reached its highest level since 2011, with the average value of construction disputes in the region reaching $91 million in 2017.

To help provide clients with advisory services that help them through their construction disputes, RICS has developed the Global Panel of Dispute Resolvers and Expert Witness (MENA) which includes accredited panels of certified dispute resolution practitioners in the built environment.

We spoke to Richard Hyde, Director Contract Claims Disputes at PWC, who is a newly elected Panel member, to understand why he wanted to become part of the Panel and what his views are on the current state of the market.

Why did you decide to join the RICS Global Panel of Dispute Resolvers and Expert Witness (MENA)? 

The region has seen unprecedented levels of investment in infrastructure and construction projects and the consequent growth in disputes (which often remain long after employers take over their projects) indicates that dispute avoidance initiatives and dispute resolution mechanisms in contracts are mostly ineffective.

Working with numerous claimant and respondent clients in the region on some of the largest programmes, there is an opportunity to promote more effective ways to avoid and resolve contract disputes.

The panel provides the opportunity for practitioners to improve their knowledge and skill in dispute resolution practice applying these practices to help promote consistent standards across the region and help resolve essential client problems.

How does becoming a part of RICS President's Panel add value to your career?

Panel members have the opportunity to promote consistent standards of practice across the region. This helps to distinguish the service practitioners deliver which I believe can add value to your career in the long run.

Do you have any tips for those interested in joining the Panel?

Given the fact that disputes arising on construction projects involve multiple parties from diverse multi-cultural backgrounds, industry practitioners can improve effectiveness by improving their communication skills applied to professional practice. Take time to consider the clients business drivers and underlying long-term interests of the parties ahead of short-term business drivers in providing objective advice.

What are the main causes of disputes in the Middle East, and what are the best ways to solve them?

The main causes of disputes include;

  • The inadequate scope of works/services definition combined with a rush to award contracts on partially completed design information
  • Unrealistic project durations
  • Ineffective risk and project management practice
  • Contract administration practices
  • Bureaucratic change management and approval processes
  • Procurement methods - reliance on price-based selection
  • One-sided contracts fuelling an adversarial industry culture

Solutions require changes in the way that projects are procured, and risks managed by the parties to promote a more collaborative approach to project delivery. Improved design and scope development and the early identification and proactive management of project risks can help reduce the number of issues escalating into disputes.

To find out more about appointing a dispute resolver or how to apply to be on the Panel, please contact our Dispute Resolution Service.