Author: Jeremy Glover, Fenwick Elliott LLP
Abstract
On the 50th anniversary of the first use of Dispute Boards, and in light of the Dispute Boards International Survey Report published by King’s College London in December 2024, this article reviews the history of research into the effectiveness of Dispute Boards. Starting with an insight into that very first Board, the article tracks the initial studies carried out in the US, reviews the project data accumulated by a number of US Transport Departments, considers the global research carried out by the DRBF and considers the position in South East Asia. Finally, the article compares the results of these surveys with the new Report which came out last year.
Introduction
The year 2025 marks the 50th anniversary of what is commonly believed to be the first project to use a formal Dispute Review Board (or DRB) as part of the original contract documents. Coincidentally at the end of 2024, Professor Renato Nazzini and Raquel Macedo Moreira of King’s College London released their Report “2024 Dispute Boards International Survey: A Study on the Worldwide Use of Dispute Boards over the Past Six Years” 1 (“KCL Report”), which provides a number of valuable insights into the use and effectiveness of Dispute Boards (DBs) 2 in the construction and infrastructure sectors.
The first project, the second bore of the Eisenhower Tunnel in Colorado, was bid on 8 August 1975. The members of that first DRB were two engineers, Al Mathews and Charles McGraw, and a lawyer, Palmer King. 3 We know a little about what happened from a paper prepared by Palmer King sometime after the project had been completed. 4 He noted that the construction of the first bore of the Eisenhower Tunnel had been a financial disaster:
“Determined not to get burnt again, the Colorado Department of Highways,
for the construction of the second bore, provided for a ‘Review Board’ to make
recommendations which could not be settled at the job level.”
The DB concept was very new, and had not yet been used. The previous year, the US National Committee on Tunneling Technology, looking to develop recommendations for improved contracting methods in the US, had sponsored a study of global contracting practices. The study, “Better Contracting for Underground Construction”, concluded that one significant block on the efficiency of the construction process and cause of rapidly escalating construction costs was the impact of disputes and litigation. One of the new concepts proposed in the report was the DB. 5
On the Eisenhower Project, there was an immediate change. The first bore of the Eisenhower Tunnel had resulted in a number of large claims, on which the Colorado Department of Highways had had to pay out around US$50million. However, Palmer King reported that:
“… with the second bore, the biggest problem the Board had was that we went along
for over two years with no problems.”
In the end there were four minor claims, the largest being for US$550,000. Palmer King speculated that if the claims had been submitted to litigation they probably would not have been settled before 1985. The DB can safely be considered to have had a successful impact of the project. Given the success of the very fi rst DB, why, 50 years on, are we still debating the value of DBs? Indeed, a July 2024 study lead by Dr Yuting Chen of some 454 projects across 74 countries from 2004 to 2022 concluded that the clause of the FIDIC contract that was most often deleted or amended was that relating to the DB. 6 The purpose of this article, therefore, is to review some of the more important research that has been undertaken since the Eisenhower Tunnel project, and compare the results against the conclusions reached in 2024 by King’s College London.
*Email: jglover@fenwickelliott.com.
1 https://www.kcl.ac.uk/law/assets/kcl-dpsl-2024-dispute-boards-international-survey-report-digitalaw.pdf (last accessed 4 March 2025). I was a member of the Steering Committee for this survey.
2 There are a number of different forms of Dispute Board (DB), of which the DRB is just one. The ICC Dispute Board Rules 2015 state that: “ A Dispute Board is a standing body typically set up upon signature or commencement of performance of a mid- or long-term contract, to help the parties avoid or overcome any disagreements or disputes that arise during the implementation of the contract.” For ease of reference in this paper I will use the general term DB unless a specific form of DB is being referred to.
3 And the make-up (and success) of that very first DB should perhaps end forever the debate about the inclusion of lawyers as members of a DB.
4 Mathews, A A, “The First Dispute Review Board”, DRBF Foundation (January 1997) Forum 1(1).
5 The report refers to the adoption of an industry-wide system of arbitration with qualified (i.e.experienced in construction/tunnelling) proposing “ Nonbinding arbitration, preferably conducted by
specially qualified and long-term employed arbitrators … provided for in the Contract”. A clear fore-runner of the standing DB concept.
6 Dr Chen, Y and others, “The Global Use of FIDIC by Chinese Architecture, Engineering, and Construction (AEC) Firms”, July 2024, Tianjin University and London South Bank University (LSBU) https://www.yutingchen.co.uk/publications (last accessed 4 March 2025).