Recently, Matt and I gave a talk to RICS members in Dubai while in the UAE on business. I’m not sure who enjoyed the evening more though, the delegates who sat through “loss and expense claims in practice“, or Matt and I listening to their stories of the disputes that arise on projects in the Arabian Peninsula. While anyone who has watched the development of this area will know that the Emirati’s appreciate how to do building on a massive scale (the Burj Khalifa is really something to behold), it’s also clear that they also know how to get into some sizeable disputes.
It’s about arbitration in the UAE
There was certainly no point in Matt or me suggesting that they resolve their disputes by means of construction adjudication: there is no provision for adjudication in the UAE, and the preferred means of resolving construction disputes, particularly involving international parties, is clearly arbitration. Indeed, the Dubai International Arbitration Centre (DIAC) told us that there had been considerable increase in appointments over the past four years, which they put down to the economic downturn in Dubai.
However, that’s not to say that the skills developed as adjudicators aren’t transferable to arbitration. I touched on one of those skills last week, namely time management. I’m sorry to harp on about it, but I really think that it’s a skill learnt in adjudication that is readily transferable to arbitration, and it would benefit arbitration if it was applied more often, particularly domestically. For example, a solicitor recently told me that he once waited 2½ years for an arbitrator’s award, only to discover that his client had lost. Parties litigating in the Technology and Construction Court (TCC) can expect their judgments in a fraction of that time. And we wonder why domestic arbitrations are so few and far between?
The parties aren’t always helped by the arbitral rules either. Even if those arbitral rules require the arbitrator to produce an award within a given time, he may nevertheless be able to extend such time. For example, rules 36.2 and 36.3 of the DIAC rules provide that:
“36.2 The time limit within which the Tribunal must render its final Award is six months from the date the sole arbitrator (or the Chairman in the case of three arbitrators) receives the file.
36.3 The Tribunal may, on its own initiative, extend the time-limit for up to additional six months.”
Arbitrators should manage the timetable effectively to minimise the need to extend time limits.
What other skills are transferable?
I believe an adjudicator has other skills that are transferrable to arbitration, including the ability to:
- Identify the key issues of the dispute. This is an essential skill for adjudicators and arbitrators alike.
- Produce an enforceable decision. This is equally important when producing awards in either forum.
- Provide clear reasons. This is an essential skill for any adjudicator and simply saying “I prefer X or Y” without explaining why is seldom acceptable. The parties need to understand why an adjudicator has reached a particular conclusion, particularly if they have lost. Again, this skill is just as important in arbitration.
- Ensure that the process is fair to both parties.
Adjudication and arbitration may be different animals, but the skills needed are essentially the same. Who knows, perhaps in time the UAE will introduce statutory construction adjudication to compliment the developments in arbitration.