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HOW A DRB WORKS
A DRB is usually composed of a panel of three respected and impartial professionals who are experienced in the specific type of construction proposed. (Small, less-complex projects sometimes use a one-member DRB). The DRB only assists the project in avoiding and resolving disputes.
A DRB is created by first including the DRB specification section in the contract documents (see Guideline Specifications recommended by DRB Foundation). Ideally, the DRB specification is included in the bid documents. The DRB requirement can be added by change order after contract award; however, this approach eliminates the positive effect the DRB can have on bids and runs the risk that work will be underway before the DRB is organized. The DRB hearing process should be inserted in the dispute resolution ladder between the contractor’s request for an equitable adjustment and the engineer’s or owner’s final decision; see DRB Flow Chart.
The Board members should be selected and approved by both the owner and contractor soon after award of the contract. One of the members is selected to chair the Board. The DRB is officially established when the parties and Board members execute a Three-Party Agreement. The DRB should have its first meeting immediately after the contract is executed and before construction begins.
The DRB members are provided with all contract documents; copies of construction progress reports; and minutes of weekly project meetings. This allows the DRB to keep current with the project’s progress and to be ready to address disputes as they arise. Periodic status meetings and site tours are held at the job site; the frequency usually varies from monthly to quarterly depending on the nature of the work. At these meetings, owner and contractor representatives brief the DRB about job progress and potential disputes.
The DRB focuses on resolving disputes at the job level. If asked by both parties, the DRB may provide informal recommendations on resolving potential disputes to promote harmony and encourage prompt solutions. If the parties cannot resolve a dispute promptly by themselves, either party may refer the dispute to the DRB for a formal hearing and written recommendation.
At the hearing each party explains their position and is allowed to challenge the other party’s premises and arguments in a courteous and professional manner. Board members may ask questions about the testimony and evidence presented. The objective is to fully air the dispute and determine the facts.
After the hearing, the DRB deliberates privately to consider the parties’ claims and defenses in light of relevant contract documents and facts of the dispute. The DRB’s written recommendation may address quantum and/or merit, as stipulated by the parties, and includes the reasoning behind each recommendation. DRB recommendations are not binding on the parties.
The parties then negotiate a final resolution in light of the DRB’s recommendation. The recommendation is admissible in subsequent adjudication (i.e. administrative hearing, arbitration, or litigation) if negotiations are unsuccessful.
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The Dispute Resolution Board Foundation Texas Chapter |
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Fostering Common Sense Dispute Resolution in Texas |
