SOLUTIONS LOOKING FORWORD

Looking ahead, our findings are similar to last year. On one hand, owners and contractors should continue to focus on spending additional efforts at early stages. Indeed, respondents overwhelmingly (63.6%) chose risk management as the most effective claims avoidance technique. Moreover, the importance of contract mandated early resolution forums such as mediation, disputes review boards, etc. ranked in third position of factors influencing an early resolution of disputes.

On the other hand, and even if contract administration seems to have already improved as detailed above, owners and contractors should keep continuous efforts in contract management during the project, as proper contract administration has been proven to have the single largest impact in avoiding disputes.

Moreover, accurate and timely schedules and reviews by project staff or third parties are listed as the second most important factors in the early resolution of disputes. As delay analysis becomes more well-known and used, it indicates an increasing awareness of the importance of managing schedules and of assessing delays and responsibilities in all dispute resolution methods.

To conclude, there is no doubt there is increasing investment in dispute avoidance and resolution techniques, with an increased use of digital tools in this discipline. However, there is, while remaining stead, no sign of a decrease in the volume of disputes.

Moreover, no one should forget about the critical importance of human factors, especially given Continental Europe's cultural approach. Indeed, party-to-party negotiation has again been listed as the first dispute resolution method, and the most important factor in the mitigation/early resolution of disputes encountered in 2018 was the owner/ contractor's willingness to compromise.

In Continental Europe's specific market, the upcoming years will be critical in assessing the impact increasing professionalization of dispute avoidance and resolution techniques have on disputes.

GUEST COMMENTARY

"Is it such a surprise to see differing site conditions topping this year's List of the most common causes of disputes in Continental Europe?

We have certainly seen, for quite some time, an increase in the number of disputes relating to site and geotechnical conditions particularly in those Central and Eastern European countries that joined the EU in 2004 and 2007. A number of those countries have indeed rushed to launch new tenders due to a significant risk of losing EU funds available to them for specific eligibility periods and this was done without the necessary level of project preparation including adequate feasibility studies highlighting potential geotechnical risks.

This has in turn led to disputes relating to the risk of site and geotechnical conditions which some employers have recently sought to address by transferring so far as they could that risk to contractors resulting in EPC-style contracts even in respect of underground works. Has this transfer of risk reduced the number of disputes? Not really, and one can hope that employers will now consider new models of risk allocation for works which contain a significant geotechnical uncertainty. The FIDIC Emerald Book - First Edition of the "Conditions of Contract for Underground Works" - which was launched in May 2019, is in this regard an interesting development.

Another interesting development is the increasing use of dispute avoidance mechanisms, such as dispute boards, on Large infrastructure projects. One good example is the Grand Paris Project which is mentioned in the Arcadis report and which is currently the Largest infrastructure project in Europe (with 200 km of new metro Lines and 68 stations, for a cost in excess of €32.5 billion). Some of the contracts recently awarded on that project include provisions for standing dispute review boards, a new feature in public works projects in France. Let's watch this space and see whether dispute boards will feature in next year's issue of the Arcadis Report."

FRÉDÉRIC GILLION RE
Partner - Pinsent Masons (France)