Lawyers and clients told to embrace DRBs on major projects

Lawyers are being urged to learn and promote the use of Dispute Resolution Boards (DRBs) on major projects by leading infrastructure specialists.

According to former NSW Treasurer and Premier, Nick Greiner, and current chairman of Infrastructure NSW DRBs are the most cost effective way of ensuring projects are delivered on time and on budget. “DRBs are focused not only on resolving the dispute but also preventing disputes,” said Greiner. “The key to delivering a project on time and on budget is to stop issues from becoming full blown.”

Speaking at the 12th International DRB Foundation Conference in Sydney on Friday, Greiner added that the capacity DRBs have to be proactively engaged with parties is tremendously important in dealing with issues when they arise, “so that they do not become a serious threat to the project”.

There has been 30 DRBs established across more than A$11 billion worth of projects in Australia/New Zealand and not one of those DRBs have had a dispute go beyond the DRB to judicial proceedings, stated Greiner. “Only six of those 30 have had formal disputes decided by the DRB...It seems to me the strike record of DRBs in Australia speaks volumes for itself.”

However, statistics gathered on the construction and building sector in 2006 showed that fewer than 40 percent of projects in Australia had a DRB. Public Private Partnerships (PPPs) in particular have failed to utilise DRBs in Australia. “By and large, PPP projects have not used DRBs,” said Greiner. “But I can see, given they have difficult structures, DRBs would be helpful. It would be interesting to look at PPPs and see whether a DRB could have made a difference in the success of PPPs.”

Ron Finlay, lawyer and chief executive of Finlay Consulting, said that one of the main inhibitors to DRBs was lawyers who did not understand DRBs and hence were unable to sell them to their clients from the outset of a project. Clayton Utz partner and president of DRB Australia, Doug Jones, added that for many lawyers the concept of having no disputes “was bad for business”.

Identifying risks the key to unleashing infrastructure projects: Blake Dawson 27 July 2011


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