Civil Engineering July 2021 | Vol 29 No 6

Civil Engineering July 2021 13 Q Q Either determinative or negotiated in nature; and Q Q Either preliminary or final in nature. A procedure may also be part of the interest-based or rights-based approach to resolving a dispute, depending on when and how the procedure is used. Litigation, arbitration, expert determination, and adjudication are procedures that are determinative in nature, while an amicable settlement technique (such as providing an opinion or stating the principles in support of a proposed agreement), a dispute review board and an early neutral evaluation are procedures that are negotiated in nature. Determinative outcomes are enforceable while negotiated outcomes (before they are embodied in an agreement) are not enforceable. Yet the latter constitute a concrete and useful alternative. Adjudication is a procedure that is preliminary in nature. A determination is usually reached within a short period of time and effect should be given to such a decision until it is set aside, substituted or altered by a higher authority. Court litigation, arbitration, expert determina- tion and agreement are procedures that are final in nature. Once the procedure has run its course, there is a final, binding determination. The procedures associated with the interest-based approach to dispute resolution are usually negotiated and pre- liminary determinative procedures. Here the concerns of the parties are addressed in such a manner that they acquire a better understanding of their (and their counterpart’s) rights and obligations in terms of the dispute and can explore a range of potentially win-win solutions. The parties are then able to act and take the necessary decisions in their (and the project’s) best interests, allowing the construction work to proceed without unnecessary extra costs or delays, and without the risk of suspension or cancel- lation of the work. These procedures could also act as a filter to prevent a dispute from escalating further. The out- come is usually achieved in a relatively quick, robust and inexpensive manner and addresses two critical issues: Q Q Whether monetary relief is due to the contractor (as a positive cashflow is the lifeblood of the construction industry) Q Q It allows the parties to take mitigating measures if circumstances are not favourable to them or the project. The procedures associated with the rights-based approach to dispute resolu- tion are usually final determinative procedures. Here the legal rights and obligations of each party to the dispute are finally determined and put into effect without the risk or fear of such rights and obligations being set aside, substituted or altered – although this may not necessarily be in the best interests of the parties or the project. Unlike the interest-based approach, the rights-based approach does not allow the interests of the parties to be explored and the outcome is usually determined over a lengthy period at great cost. Although there are similarities between the processes prescribed by the various standard construction contracts commonly used in South Africa, they do differ in terms of subject matter, content and application. The different processes are as follows: Q Q Under the Joint Building Contracts Committee – Principal Building Agreement (JBCC) the dispute may be referred to arbitration without being referred to adjudication at all. However, if the dispute is first referred to adjudication and one of the parties is not satisfied with the outcome, the dispute should then be referred to arbitration. The parties may agree to refer the dispute to mediation before adjudication (if adjudication is pursued) and/or before arbitration (whether adjudication is pursued or not). Q Q Under the Engineering and Construction Contract (ECC), the dispute should first be referred to senior representatives, and, if no set- tlement can be reached, it should then be referred to adjudication. If one of the parties is not satisfied with the outcome, the dispute should then be referred to the tribunal, which could be arbitration, court litigation, expert determination, or a dispute resolution panel, depending on what is stated in the contract data. Q Q Under the General Conditions of Contract for Construction Works (GCC) the dispute should be referred to adjudication, but the parties may agree to first use one of the amicable settlement techniques. If no settle- ment can be reached by invoking the latter, the dispute should then be referred to adjudication. Similarly, if one of the parties is not satisfied with the outcome, the dispute should then be referred to arbitration or court litigation, depending on what is stated in the contract. In such a case, the parties may (again) agree that an amicable settlement technique should precede arbitration or court litigation, Table 1 Overview of the processes prescribed by commonly used standard construction contracts Approach Nature JBCC NEC GCC FIDIC Part of the rights- based approach to the process Final determinative Arbitration Tribunal (court litigation, arbitration, expert determination, dispute resolution panel) Arbitration or court litigation Arbitration Part of the interest-based approach to the process Negotiated Mediation, if parties so agree Any amicable settlement technique, if parties so agree Amicable settlement Preliminary determinative Adjudication Adjudication Adjudication Adjudication Negotiated Mediation, if parties so agree Senior representatives Any amicable settlement technique, if parties so agree