The motivation behind this monthly newsletter is to provide better and more frequent communication to CAASA members, and to solicit suggestions and responses to the contents. We need input from you to ensure that the content of this newsletter, our webinars and annual conference remain both topical and relevant.
THE ROLE OF THE DISPUTE AVOIDANCE/ ADJUDICATION BOARD (DAAB)
Although this article considers the role of the DAAB under the FIDIC Conditions of Contract for Construction Second Edition 2017 (the Red Book), the principles are applicable to any standing board such as the Dispute Avoidance Board in Option W3 of NEC4 or the Standing Adjudication Board in GCC 2025.
The DAAB has two primary objectives. Firstly to assist the parties to avoid disputes (dispute avoidance). If a Dispute cannot be avoided the second objective is to achieve the expeditious, efficient and cost-effective resolution of the Dispute.
Whereas the Red Book 1999 version placed the emphasis on resolving disputes, the 2017 version focuses on avoiding disputes. To avoid any misconceptions FIDIC have defined exactly what constitutes a “Dispute”.
One Party makes a claim against the other party
The other Party (or Engineer) rejects the claim in whole or in part
The first Party does not acquiesce
Unlike the 1999 Red Book where Clause 20 encompasses both Claims and Disputes, the 2017 version deals with claims under Clause 20 and disputes under Clause 21.
Site Visits
Site visits are an integral part of the functioning of the DAAB. The Red Book sets out the recommended frequency of such visits. Typically, the visit commences with a drive/walk through of the site so that the DAAB members familiarize themselves with progress on the site, any unforeseen obstacles or physical conditions and potential circumstances which could give rise to a claim. The drive or walk through is normally followed by a DAAB Meeting with the Parties’ representatives on site and the Engineer. If possible, the DAAB members are encouraged to attend the site progress meeting as this can often highlight potential disputes or differences early in the process.
Documents
The 2017 Procedural Rules list the documentation which the DAAB can request.
The DAAB requires copies of the signed Contract and other related documents.
In between site visits the DAAB relies on copies of the monthly Minutes of Site Meeting, Appendices and programme updates to stay informed, as well as copies of any notices issued pursuant to subclauses 8.4 [Advance Warning]; and 20.1 [Contractor’s Claims]
Although not listed a key document for the DAAB is a Joint Statement produced by the Contractor and Employer/Engineer just prior to the DAAB Site Visit. While the Site Meeting presents a snapshot of the project at a point in time it is mostly backward looking, recording what has already occurred. The Joint Statement aims to be more forward looking focusing on points of disagreement or potential disputes.
Where the Contractor or the Employer/Engineer disagree with a position or averment put forward by the other party this should be recorded in the Joint Statement.
After the Site visit the DAAB will prepare a report for the Parties recording the progress of the works as noted from the drive/walk through, performance against the latest accepted programme and other parameters, advance warnings, informal assistance requested or provided, notices received, claims and other relevant information.
Dispute Avoidance
Sub-Clause 21.3 provides that:
If the Parties so agree they may jointly request (in writing, with a copy to the Engineer) the DAAB to provide assistance and/or informally discuss and attempt to resolve any issue or disagreement that may have arisen between them during the performance of the Contract. If the DAAB becomes aware of an issue or disagreement, it may invite the Parties to make such a joint request.
Such joint request may be made at any time, except during the period that the Engineer is carrying out his/her duties under Sub-Clause 3.7 [Determination] on the matter at issue or in disagreement unless the Parties agree otherwise.
Such informal assistance may take place during any meeting, site visit or otherwise. However, unless the Parties agree otherwise, both Parties shall be present at such discussions. The Parties are not bound to act on any advice given during such informal meetings, and the DAAB shall not be bound in any future dispute resolution process, or decision by any views or advice given during the informal assistance, whether provided orally or in writing.
FIDIC Practice Note No 1 encourages all the participants on a project to play a proactive role in avoiding disputes as doing so will result in significant benefits including:
maintaining cashflow,
allowing the parties to focus on real-time project management and the successful completion of the project,
clearing differences at an early stage, before positions crystalize, avoiding disputes from piling up,
avoiding the costs and time of resolving conflict and in particular in litigation,
avoiding the need to be engaged in the enforcement of dispute board decisions and/or court awards,
maintaining, or minimising the damage to, good business relationships,
minimizing harm and stress on project participants.
A critical factor in successful dispute avoidance is to identify and address the problem at an early stage, before the parties’ positions become entrenched. It could be a question of fact or law, a contractual or technical interpretation, a measurement issue or a matter of principle.
Keep in mind that the Contract does not allow the DAAB to provide any such assistance on a claim in the period between the Contractor submitting his claim and the Engineer’s Determination, unless otherwise agreed.
Examples of matters that can be successfully resolved through dispute avoidance are:
Questions of contract interpretation or understanding of the Contract’s substantive or procedural provisions, including the proper interpretation of the BoQ and its specifications.
Whether an Engineer’s instruction constitutes a Variation.
Evaluation of the additional time and cost caused by a Variation.
Design responsibility and liability. For instance, whether different tiers of liability exist and where fitness for purpose is required.
Contractual and/or legal merit of claims.
How a particular event encountered on Site would be dealt with under the contract.
What evidence of cost incurred would be considered sufficient by the DAB for seeking compensation and how it should be presented.
Dispute avoidance can take various forms. Informal discussions between the DAAB and the parties. These can be used to lead to a swift resolution by, for instance, a joint reading of the Contract, or by facilitating a negotiation between the parties. In such instances, whether informal assistance is to be carried out orally or in writing should be determined after consultation with the parties, considering their preferences and taking into account the specific circumstances of the situation.
A “formal” request in writing, and a written record of the DAAB’s assistance, may be appropriate when the parties need to have a written record to be able to present it to their management and/or third parties.
Issuing opinions. Opinions, which can be either oral or in writing, issued as a separate document or included in a site visit report, may be very helpful for the parties to avoid disputes, as they provide a useful indication of the dispute board’s view on a particular issue. Furthermore, owing to the non-binding nature of an opinion, the parties keep control of the dispute resolution process which often encourages the parties to settle. It must be emphasised that opinions are cheaper and quicker than decisions. The DAAB must encourage the parties to make joint requests for an opinion whenever they feel that it could help them to avoid disagreements from becoming claims and disputes.
It must be stressed that the parties should not wait for the next DAB visit to request any of the above, the DAB remains available at any time.
Dispute Resolution
Despite the best efforts of the DAB and the parties in some instances a dispute cannot be avoided and will be referred to the DAB for a Decision.
Sub-Clause 21.4 [Obtaining DAAB’s Decision] records that If a Dispute arises between the Parties, then either Party may refer the dispute to the DAAB for its decision (whether or not any informal discussions have been held under Sub-Clause 21.3 [Avoidance of Disputes………”
The DAAB decision should be clearly written, well-reasoned, comprehensible, address all issues raised by the parties and be fair in accordance with the contract, taking due regard of all the circumstances.
In terms of the Procedural Rules included in the Contract, the DAAB is empowered, inter alia, to decide upon its own jurisdiction and the scope of any dispute referred to it, establish the procedure to be applied, and is not bound by any rules or procedures other than those contained in the Contract and the Procedural Rules. The DAAB may take the initiative in ascertaining the facts, may use its own specialist knowledge (if any), may decide upon provisional relief such as interim or conservatory measures, and may also open up, review and revise any certificate, decision, determination, instruction, opinion or valuation of the Engineer relevant to the dispute.
The purpose of adjudication is to provide the Parties with a relatively quick and inexpensive independent, impartial decision on the matter in order to settle the dispute. Given the purpose of adjudication and the fact that it is not the final decision on the dispute, the DAAB may take a robust approach, and is not strictly bound by any procedural rules or rules of evidence other than those stipulated in the contract and the rules of natural justice.
CAASA MATTERS
Our monthly webinars commenced on 13 February 2026. The first 3 sessions delved into compensation events under the NEC. The next session is on Friday 8th May where I will discuss The SCL Delay & Disruption Protocol.
CAASA ran a mentoring programme last year over a 6-month period. Based on the very positive feedback received we intend to run this again in 2026. More details will be provided soon. We are looking for mentors to be involved in the programme. If any CAASA member is willing to become a mentor or requires additional information, please email Michelle Kerr at mkerr@mdalaw.co.za
It is that time of year when you will soon receive your annual membership invoice. The annual fee is R 900.00. Considering what similar organisations charge compared to the services offered CAASA membership is real value for money. Please pay promptly.
