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“ All together Now:  Innovative Contract Management with Dispute Boards ” PRESENTERS:

American Bar Association Forum on the Construction Industry. 2012 Fall Meeting. “ All together Now:  Innovative Contract Management with Dispute Boards ” PRESENTERS:. Adrian Bastianelli , Moderator Peckar & Abramson, P.C. Washington, DC. Warren Bullock Sebastopol, CA

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“ All together Now:  Innovative Contract Management with Dispute Boards ” PRESENTERS:

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  1. American Bar Association Forum on the Construction Industry 2012 Fall Meeting “All together Now:  Innovative Contract Management with Dispute Boards” PRESENTERS: Adrian Bastianelli, ModeratorPeckar & Abramson, P.C. Washington, DC • Warren BullockSebastopol, CA • Doug HolenSanta Fe, NM

  2. OVERVIEW OF DRB PROCESS Objective Selecting the DRB Members Site Visits Hearings Recommendations Benefits Statistics DRB Foundation www.drb.org The Washington Experience

  3. DRAFTING THE CONTRACT • Specification provisions • Three Party Agreement • DRB procedures • What should be included? • Qualifications of DRB members • Ethics requirements (neutrality) • Selection process for DRB members • Timing of selection of DRB members • Payment of DRB members

  4. DRAFTING THE CONTRACT • Timing of regular meetings and site visits • Method of referral of disputes to the DRB • Pre-hearing submissions • Hearing procedures • DRB recommendations • Binding or non-binding • Admissibility of DRB recommendations • Informal or advisory opinions • Clarification and reconsideration

  5. SELECTING THE DRB • How do you select the DRB members? • Party appointed with right of each party to reject member without cause • Mutually selected • Parties designate several and other party selects one from that group • Are attorneys allowed to be members of a DRB?

  6. SELECTING THE DRB • Can DRB members appointed by a party really be neutral? • Are DRB members governed by any ethical standards? • Is a DRB member required to have DRB training? • How much do DRB members get paid?

  7. REGULAR MEETING AND SITE VISIT • How often? • What is discussed at the regular meetings? • Why make regular meetings? • Observe the work in the event of a future claim • Observe the people • Develop a relationship of trust with the parties • Force a real time discussion of the issues

  8. REGULAR MEETING AND SITE VISIT • Does the DRB become involved in the construction process? • What if the DRB member observes a construction defect? • Does the DRB try to help the parties resolve future problems? • What happens if the parties decide to save money by canceling the regular meetings?

  9. THE DISPUTES PROCESS • What kind of discovery do the parties get? • What do the prehearing submissions look like? • Who should make the presentation? • Project personnel • Home office personnel • Consultant or expert • Lawyer

  10. THE DISPUTES PROCESS • What is the place of the lawyer in the presentation of the dispute? • How can you decide a claim without cross examination?

  11. THE RECOMMENDATIONS • Why recommendations and not a decision or award? • Should the recommendations be binding? • Should they be admissible in court? • What do the recommendations look like? • What is the key to drafting the recommendations?

  12. THE RECOMMENDATIONS • Can the DRB do equity or is it bound to enforce the contract language and the law?

  13. THE ADVISORY PROCESS • Why have such a process? • Can the DRB fairly consider the claim in the formal process once it issues recommendations in the advisory process?

  14. OTHER ISSUES • What do you do if one party becomes dissatisfied with a DRB member? • Should the DRB act proactively? • Should the DRB mediate or assist parties in negotiation? • Can the DRB handle subcontractor or design professional claims?

  15. OTHER ISSUES • Can the DRB be effective on a small project and what is a small project? • Should stepped negotiations or mediation precede the DRB process?

  16. TO DRB OR NOT TO DRB • Reasons to include a DRB provision in the contract? • Results in discussion of issues regularly in front of 3 neutrals whom the parties want to impress • Avoids disputes even reaching DRB hearing stage • Provides recommendations from 3 experts who the parties trust and who have seen the work • Real time resolution • Expeditious and low cost

  17. TO DRB OR NOT TO DRB • Reasons to include a DRB provision in the contract? • Non-adversarial proceedings, allowing the parties to maintain good relations during the project • Avoids the end of job omnibus claim • Avoids litigation

  18. TO DRB OR NOT TO DRB • Arguments against including a DRB? • Cost • Time commitment • Non-binding • DRB may do equity and not enforce the contract • No discovery or cross examination • Recommendations could sway court or jury

  19. SUMMARY • Do DRB’s really work? • Will they put the construction litigator out of business?

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