No.

Subject

Traditional contract

Alliance contract

Material difference and trade-off between traditional contract and alliance contract

16

Dispute resolution

If a dispute or difference arises under the contract, either party may deliver a notice of dispute in writing to the other party and the parties will:

attempt to resolve the dispute by conferral and, failing resolution by conferral, submit the dispute to arbitration (Alternative 1); or

submit the dispute to the Superintendent for a decision and, if either party is dissatisfied with the decision, submit the dispute to arbitration (Alternative 2).

Either party may institute proceedings to seek injunctive or urgent declaratory relief for any dispute arising under the contract.

The Participants are jointly responsible for performing the Works. In performing the Works, the Participants must act in good faith* and in accordance with the Alliance Charter. The Alliance Charter sets up a model of agreed decision-making processes and incentives which seek to align the Participants' objectives in relation to the Project and, in that way, reduces the risk of disputes and, it is hoped, removes the possibility of litigation between the Participants. Further to this, the Participants agree that there will be no litigation or arbitration between them under the alliance contract, except in limited circumstances (i.e. Wilful Default by a Participant).

Each Participant must immediately notify the others of any issue which may amount to a dispute under the alliance contract. The ALT must deal effectively with any differences of opinion and conflicts of interest which may arise and will agree on a dispute resolution procedure, consistent with the no litigation principle, for the alliance.

Under a traditional contract, there is a formal dispute resolution procedure which will apply to resolving disputes arising under that contract.

Unlike under a traditional contract, the alliance contract does not contain a formal dispute resolution procedure. This is because the Participants must act in good faith* and in accordance with the Alliance Charter under the alliance contract which sets up a model of agreed decision-making processes and incentives which seek to align the Participants' objectives in relation to the Project and, in that way, reduce the risk of disputes and remove the possibility of litigation between the Participants. The ALT must deal effectively with differences of opinion and conflicts of interest which may arise under the alliance contract. In addition, the Participants agree to the no litigation principle under the Agreement (with limited exceptions). This has the effect that the adversarial or 'claims-based' culture of the traditional contract does not pervade the alliance contract. However, some alliance contracts also include a dispute resolution procedure that will apply if the ALT is unable to resolve the dispute.

The ALT must resolve all issues which arise under the alliance contract in a unanimous manner and in accordance with the procedure developed for that purpose. The Participants may not resort to litigation to resolve issues under the alliance contract.