Preliminary remarks

1. This report is the result of a study commissioned by the ICC Commission on International Arbitration. It was produced by the Construction Arbitration Section of the Commission's Forum on Arbitration and New Fields, under the joint leadership of Dr Nael G. Bunni and Judge Humphrey LLoyd QC, assisted by Mr Michael E Schneider,1 Mr William Laurence Craig, Dr Aktham El Kholy, Dr jur. Joachim E. Goedel, Mrs Vera van Houtte, Mr Sigvard Jarvin and Dr Igor Leto.

2. The Construction Arbitration Section was given the following remit:

Construction arbitrations need careful handling. Some arbitrators and others may not be fully aware of how best to use the powers conferred by the 1998 ICC Rules to secure cost-effective arbitrations. The Construction Arbitration Section will first find out what techniques have been used successfully to control construction arbitrations. It will then produce guidance for arbitrators, perhaps in the form of a handbook, which might contain sample procedures (under Article 15), directions and forms.

The Section will take account of the effect on arbitrations of the introduction into contracts of new and evolving forms of dispute resolution which are intended to reduce the disputes that require to be arbitrated, e.g. Dispute Review Experts or Boards or Adjudicators. It is hoped that in this way it will be possible to demonstrate that arbitration under the ICC Rules, if properly directed by the arbitral tribunal, is at least as good as arbitration under other rules or at other centres.

We understood the term 'construction arbitrations' to mean arbitrations that concern all kinds of disputes arising out of projects for construction work, but mainly those relating to the execution of the services (e.g. engineering services) and work necessary for the implementation of the project.

3. Views were sought throughout the world from nearly 40 arbitrators with proven experience of construction arbitrations, as well as from other practitioners.2 Although the legal and cultural backgrounds of the respondents varied widely there was a striking degree of unanimity on many points.

4. Drawing on the replies and our own experience we issued a first report in March 2000. It was intended as a document for discussion rather than one which contained settled views. The report was placed on the ICC International Court of Arbitration's web site. The comments that we received on that report gave us confidence that our original proposals were generally correct. Indeed we have been informed by a number of respondents that our suggestions have not only already been put to good use in construction cases but are relevant to other types of disputes, especially where there are complex issues. In November 2000 we presented a revised version of our first report. Further comments were received which led us to [Page9:] amplify and clarify certain parts. However our conclusions and recommendations remain essentially the same.

5. The responses showed that, whilst the ICC Rules of Arbitration provide a good framework for construction arbitrations, there is still a need to understand what is required for the efficient management of large and complex commercial arbitrations. There appears to be a remarkable lack of knowledge of current practice adopted by other arbitrators or by the legal representatives who appear before them. This could be due to the appointment by parties of arbitrators or legal representatives unfamiliar with international arbitrations, but it could also be that there is a lack of practical guidance about the management of arbitrations.

6. Thus a number of those who contributed believed (as we do) that this report should be the first stage of a continuing process by which the ICC Commission on International Arbitration, through its Forum on Arbitration and New Fields, would monitor and report on developments that could help all those concerned with construction arbitrations.3

7. A summary of our main recommendations and suggestions is to be found at the end of the report,4 together with cross-references to the main paragraphs of the report. Some of our suggestions necessarily go beyond management techniques. For example, we thought it desirable to outline the particular qualities now required of an arbitrator in an international construction arbitration and also to touch on some common points that are really about the admissibility of evidence but which arise in the context of the management of an arbitration.

8. In order to avoid misunderstanding it is also desirable at the outset to emphasize the following general points:

8.1 The report is intended primarily for arbitrators who do not have much experience of construction arbitrations conducted under the ICC Rules or who wish to be reminded of the options available or of the practice of others. Since some arbitrators are appointed who do not have much knowledge of construction arbitrations (indeed, regrettably, some nominated by parties have no previous knowledge whatsoever), it is important that this report should be seen by them to be reasonably authoritative. For that reason alone the guidance given in this report is not hedged with qualifications. Some of the proposals also concern the parties.

8.2 However, it should not be thought that we consider there is any single 'right' way in which a construction arbitration should be conducted. The report sets out certain commendable courses and the factors that arbitrators and parties may bear in mind when considering them. It is therefore unnecessary to repeat throughout the report that any recommendation is general or usual. Every case is different (although many construction arbitrations have familiar patterns) and anybody should pause and consider whether a standard or common technique is appropriate.

8.3 Our proposals are thus not intended to be used to override the wishes of the parties. Party autonomy is the kernel of international commercial [Page10:] arbitrations. Nothing in this report is intended to suggest that arbitrators should decline to follow the joint wishes or agreements of the parties (even if they could do so), especially perhaps if both are represented by lawyers familiar with ICC arbitrations. Nevertheless, from time to time parties may not have appreciated all the courses open to them or the position of the tribunal, so arbitrators are not only entitled but bound to inform the parties if they consider that a proposed course is not the best and to propose an alternative or alternatives. Depending on the nature of the case and bearing in mind the sensitivity of the subject, arbitrators should take account of the financial position of each party and the resources likely to be available to them.

8.4 In our recommendations we have tried to accommodate the approaches of various national jurisdictions. Although many of those who specialize in construction arbitrations come from common law backgrounds (as was reflected in those from whom we received comments), we have tried to adopt a balanced course. The report does not therefore attempt to provide fixed solutions of universal application. That so many of the responses we received had much in common suggests that harmonization is achievable provided that attention is directed to substance and not to the form of procedures and techniques. Most of our suggestions should therefore be capable of being understood and implemented either by direct action on the part of the tribunal or by the parties acting upon the tribunal's direction.

8.5 Above all we consider that the procedures in construction arbitrations must be cost-effective. For example, some (especially common lawyers) contend that traditional common law procedures, if correctly employed, usually result in a high degree of precision in fact finding and, arguably, may enable a tribunal to arrive at decisions in which it has greater confidence. However, such procedures are costly and time-consuming. Others argue, with justification, that other systems and the practice of civil law proceedings in litigation and arbitration can lead to comparable degrees of precision in fact finding and confidence in the result, and that they can do so at lower cost and in a shorter time. We firmly believe that arbitrators in ICC arbitrations should themselves decide on the procedures appropriate to the dispute in question which will enable them to discharge their duties without unnecessary delay or expense.

8.6 Although the report specifically covers construction arbitrations, we think that it may also help arbitrators in other complex commercial cases.

9. Rules already exist for construction arbitrations, such as the Construction Industry Model Arbitration Rules (CIMAR) which are used in the United Kingdom or those published by the American Arbitration Association. We have not drawn on them (nor did any of our respondents suggest that we should) as they are essentially for domestic use, although to the extent that they converge they evidence a degree of harmonization. Nor have we used the UNCITRAL Notes on Organizing Arbitral Proceedings or the International Bar Association's latest Rules of Evidence,5 although our conclusions are very comparable in many respects.[Page11:]

Background to current construction industry disputes

10. Construction disputes always arise in a variety of situations, but today a number of changes mean that they occur in contexts which differ from those customarily encountered. In some countries the customary methods of procurement of construction projects are being supplemented by more sophisticated ones. These place greater emphasis on the responsibility of the contractor, who in turn is now less and less an executant and more and more a manager and facilitator. At the same time contractors (and subcontractors) combine more in joint ventures to offer a range of skills and services and to share risk (and perhaps to make a profit). Nowadays disputes concerning large sums are no longer confined to those between client and contractor but increasingly occur between contractor and sub-contractors.6 With the advent of computerization many disputes can be highly technical. Traditional arrangements have not of course died out, nor have habitual disputes, bred of strained relationships and mutual suspicion, and familiar claims, such as those for changes and for the consequences of the unforeseen and perhaps also the unforeseeable. They continue throughout the world, still generating complicated and intriguing problems.

11. Additional layers of protection are being introduced. There may be a project manager, a construction manager, and a host of specialist advisers and consultants appointed to look after the interests of sponsors, nominal owners, operators, suppliers or consumers. The financier or funding institution is also becoming more influential, although it may not appreciate the extent of construction risks and what is really entailed in completion. Differences arising from ignorance of the risks undertaken can be very difficult to resolve, especially if there are budgetary constraints.

12. In addition there is a greater choice of standard forms of contract. Many of these contain developed mechanisms for dispute resolution aimed at preventing disputes and averting arbitration. The role of the engineer in the majority of contracts is no longer what it was, as reflected in the latest editions of the forms of contract published by the Fédération Internationale des Ingénieurs-Conseils (FIDIC). These now provide that, even where an engineer is appointed to oversee the implementation of the design, it will not always be appropriate for the engineer to decide disputes that may concern his or her own performance and judgment. The conditions provide instead for the appointment of a Dispute Adjudication Board (DAB) or a Dispute Review Board (DRB), and for amicable settlement before an arbitration can be started.

13. Three main observations may be made about the relationship between dispute resolution structures such as DABs, DRBs and mediation on the one hand and arbitration on the other.

13.1 Firstly, one of the reasons why parties turn to DABs or DRBs during the performance of a contract is expense.7 As a means of resolving a dispute or disputes through investigation and by recommendation or provisional decision, DABs and DRBs are cheaper than arbitration, the cost of which is, with reason, perceived to be high (although generally no higher than any other form of binding dispute resolution that results in a readily enforceable decision). However, the comparison should not be taken too far, as arbitration serves a different function from DABs and DRBs. [Page12:]

13.2 Secondly, disputes that withstand the filter of a DAB or DRB (and any unsuccessful attempt to achieve a settlement) are likely to be relatively intractable, e.g. those arising out of the termination of a contract. Not that intractability is the only reason for failing to achieve a settlement through a DAB or DRB: the Board may have been unable to deal with the dispute as it would have wished and to make a satisfactory recommendation or decision; the parties may have been unwilling or unable to face up to the problem that gave rise to the dispute and to accept the financial or human consequences of a decision or recommendation from the Board; or, as sometimes happens, a party may simply have been unable to meet its obligations or been unreasonable and resorted to dilatory tactics.

13.2 Thirdly, by acting as a filter, DABs and DRBs help to refine disputes, leaving the points at issue clearer than they would otherwise be.

With the introduction of pre-arbitral methods of dispute resolution, such as DABs and DRBs, we believe that arbitrations will in future deal largely with disputes that cannot be resolved except by arbitral award, either because they raise issues that go to the heart of the parties' relationships or important questions of principle or, in the case of a main or principal contract, are too complex to be resolved satisfactorily by a DAB or DRB. Almost certainly the amounts at stake will be large. Today's arbitrators therefore need to know how these new mechanisms operate, to be alive to the expectations of the contracting parties, who now expect extremely efficient arbitrations, and to be equipped to see an arbitration through to an early award.

Selection of arbitrators

14. Careful consideration needs to be given to the selection of arbitrators, since it is vital that the tribunal should know what are the right tools and how and when to use them. It must be acknowledged that there is or should be no mystique about arbitrations concerning international construction disputes. They are in many respects no different from other international commercial arbitrations, except that they are frequently more complex (both factually and technically) and more stimulating; they can generate difficult points of law relating to specialized forms of contract unknown to those not involved in construction; and they still seem to require many more documents to be examined than in other types of disputes. Many of the disputes that cannot be resolved by pre-arbitral methods will encompass a multitude of issues of fact and opinion, not to mention questions of law, each of which merits consideration and a decision as if it were a separate arbitration. Moreover the disputes themselves can involve difficult technical questions and occasionally difficult and novel questions of law. The arbitral tribunal has therefore to decide how best such disputes are to be handled. The tribunal's judgment will be crucial to securing a cost-effective arbitration and to retaining the confidence and co-operation of the parties. Complex cases require sensitive handling so the tribunal must throughout maintain a dialogue with the parties.

15. Whilst there may be advantages in having as a member of the tribunal a person who has only general knowledge of international commercial arbitration, the responses we received suggest that it is now highly desirable that a tribunal comprises people who are familiar with construction contracts, with how construction disputes [Page13:] evolve and with how they are best resolved. In the construction sector, it is still possible to adhere to one of the features that originally distinguished arbitration from litigation - the referral of disputes to people from the relevant trade, industry or profession (which has of course been necessarily extended for the purposes of international arbitration to lawyers who have acquired equivalent knowledge). Technical issues need to be properly understood in order to be correctly decided. Not that this means that an arbitrator has to be a technical specialist. Indeed the wide range of technical issues arising in construction arbitrations would make it difficult, if not impossible, to find suitable polymaths. However, he or she must have the intellectual curiosity and ability to grasp technical issues (if a lawyer) and legal issues (if not). A party may wish to select an otherwise competent lawyer who does not satisfy this ideal, which is entirely possible under the ICC Rules of Arbitration. Similarly, a party wishing to nominate an engineer or architect should not feel at a disadvantage because that person is not as knowledgeable about the applicable law as a lawyer versed in the construction field. An arbitrator in a complex arbitration (as most construction arbitrations are or turn out to be) should also be proactive and must be able to manage an arbitration and devise an effective management framework. In a tribunal comprising more than one arbitrator, if the co-arbitrators between them do not have all the ideal attributes, then the chairman should certainly possess them. It goes without saying that in the case of a sole arbitrator, he or she should possess all the required attributes. The tribunal should not need to appoint an expert to make a decision it cannot reach itself, as opposed to one engaged to advise it on how best to assess conflicts between the technical opinions it may receive.

16. Whatever other qualities an arbitrator may or may not possess, some familiarity with computers will almost certainly be required. Basic word-processing skills are now probably indispensable since submissions, documents and other evidence in the form of witness statements and expert reports, plus transcripts, are regularly sent by email and stored on floppy disk or CD-ROM. Use of paper is thus reduced and the parties and the tribunal have immediate access to documents that might otherwise be too bulky to copy for a hearing. For specific technical issues, the use of computers will be essential. However, it must also be recognized that practice in the most developed countries cannot be emulated everywhere. The tribunal must adopt the means of communication that is the most effective for the case in question and must not impose requirements which a party is unable or unwilling to meet.

17. Finally, construction industry arbitrations have in the past been characterized by the frequency with which they are resolved by agreement before a final award. However, sole arbitrators and chairmen of tribunals should be capable of writing awards acceptable to the international construction industry. We are not suggesting that they must have done so already in an ICC case. After all, one of the safeguards of the ICC system is the need to obtain the approval of the ICC Court as to the form of the award. Also, assistance is available from the Secretariat to help a tribunal to draw up an award which, at least as regards form and style, should be enforceable internationally. Familiarity with national practice is not necessarily sufficient, nor is the fact of having been a member of a tribunal without actually having participated in the drafting of an award.

18. We recommend, therefore, that at least two of the members of the tribunal 8 have proven experience in seeing how an international arbitration about a [Page14:] construction dispute is carried through from start to finish. In addition, we also recommend that sole arbitrators or chairmen should know how to write awards. These recommendations may lead to the same arbitrators, particularly lawyers, being appointed again and again, as there is, or is thought to be, a shortage of suitable people. Steps may therefore need to be taken to make known the names of experienced arbitrators and to ensure that there are enough of them.

19. There was support for the view that costs are saved if there is only one arbitrator rather than three. For example, a visit to a site by one arbitrator is easier and cheaper than a visit by a tribunal of three (although, obviously, if the parties agree, a single member of the tribunal could carry out an inspection). We would endorse this practice especially where the amount in dispute is not large. Accordingly, we recommend that when projects not in excess of, say, 20 million US dollars 9 are put out to tender, the parties should consider whether their interests would be best served if a sole arbitrator were appointed. The value of the contract is of course not the only criterion since large claims may arise from contracts of low value. Equally, where the parties are from different cultural or legal backgrounds the opportunity for each to nominate an arbitrator gives parties confidence in the arbitral process. Nonetheless, the parties would be well advised to consider following the practice of the ICC court and not to appoint three arbitrators where the claim is not large. We believe that informed parties are now more ready to agree on a sole arbitrator, even where the dispute has already been through a contractual process of dispute resolution and is sizeable. Many contracts (such as those incorporating the various FIDIC conditions) require a 'cooling-off period' after attempts at amicable settlement before an arbitration can start, and even if not contractually required, it is frequently beneficial. This period could well be used at least to agree on the number of members in the tribunal and its make-up. Accordingly, we recommend that, even if the arbitration agreement permits three or more arbitrators, before submitting a request for arbitration parties should consider carefully whether a sole arbitrator should be appointed. It was suggested to us that, if the tribunal considered that a claim had been artificially inflated, and that, if its true value would have led to the appointment of a sole arbitrator, the claimant, even if otherwise successful, should be ordered to pay the additional costs of having three arbitrators. This seems a sensible suggestion, although we have reservations about whether the tribunal could validly reach such a decision under Article 31(3) of the ICC Rules. Since the matter concerns the selection of a tribunal it would be preferable if it were expressly mentioned in the arbitration agreement.

Initial stages

20. In this section we look at the steps that can and should be taken prior to and in preparation for the Terms of Reference, and the ensuing procedural directions which interact with them. We deal only with matters of practical relevance to construction arbitrations.10

21. Once the file has been transmitted, the tribunal must examine the statement of case and defence to see, first, whether they make sense, and secondly, whether they need to be clarified so that the Terms of Reference can be properly drawn up. If there are claims for delay or disruption, a chronology of events will be required from the parties. This should be ideally included with the claimant's request for arbitration and [Page15:] the respondent's 11 answer. Since most construction arbitrations are about the performance of a relatively long-term contract, it is in our view highly desirable that the tribunal should scrutinize any chronology with care. After each party has submitted a chronology, the tribunal itself should compile a composite chronology from the material provided and send it to the parties, asking them to clarify any discrepancies. The tribunal should thereafter maintain the chronology, amending it as the case develops, circulating any revisions, and asking the parties to complete any gaps in it. In this way a database will be built up which, for example, should readily identify the date when a decision or instruction was sought, the date by which it was required, the date when it was given, and, where appropriate, the date when the contractor received any drawings or further details referred to in it or necessary for its implementation.

22. Some submissions made by parties lack clarity even though it is the duty of parties to be clear. Many misunderstandings are due to the translation of concepts from one language into another language or arise from an imperfect knowledge of the contract. The tribunal should not hesitate to request information to enable it to create organizational charts, layouts and glossaries or to obtain other clarification, where needed, for defining a claim or an issue (as opposed to the amplification of a party's case, which should be left until the Terms of Reference have been signed). The tribunal should of course be careful not to make such a request if compliance with it would delay the production of the Terms of Reference. A request pointing out the tribunal's difficulties can sometimes lead a party or its authorized legal representative to turn to another, better qualified representative. This will frequently help the arbitration to run more smoothly, although the tribunal should be very careful not to do anything designed to influence a party's choice of representative. Amplification may be needed where, for example, a party has not anticipated a point raised by the other party or which the tribunal sees as likely to arise, concerning for example:

22.1 the jurisdiction of the tribunal, e.g. the identification of a contracting party;

22.2 whether or not notice of intention to claim has been given, if required by the contract;

22.3 whether or not a claim or defence is barred in law, e.g. by prescription or limitation;

22.4 whether or not a claim has been referred to, considered or decided by an engineer, DAB or DRB, or whether notice of dissatisfaction has been given (e.g. under the FIDIC conditions);

22.5 the amount of the claim, where unclear.

These are matters which, if not resolved satisfactorily, could cause the tribunal not to examine the whole of the claim but instead to concentrate on whether it has the necessary power or jurisdiction to deal with the claim. For instance, if a party accepts that the requisite notice was not given and there are no apparent grounds for excusing lack of notice, the tribunal might well have to make a partial award in respect of the affected claims, as it might not be right to investigate them on their merits. The tribunal should call for further written submissions before the Terms of Reference are drafted since the answers could materially affect the contents of the Terms of Reference.12[Page16:]

23. The tribunal is under no obligation, however, to seek clarification when drawing up the Terms of Reference. Points of the kind mentioned above could in some cases be left until later, especially if they relate to the legal basis of a claim or defence. A party may consider that it is for the tribunal to determine such a matter or for the other party to submit that no such basis exists.

Terms of Reference

24. The tribunal should produce the first draft of the Terms of Reference, mainly because this requires it to get to grips with the case. The more complex the case, the more important it is for the tribunal to have read and understood the material presented by the parties. However, the initial submissions in construction arbitrations are notorious for hiding the true issues. Since the cost-effectiveness of such arbitrations can be dependent on the procedures adopted, it is always prudent to invite the parties not only to list the issues which they consider arise but also to put forward any other matters that might usefully be included in the Terms of Reference, such as procedural rules and a suggested provisional timetable. The Terms of Reference must meet the requirements of Article 18(1) of the ICC Rules of Arbitration. Construction arbitrations call for particular attention to be given to the following items.

Summary of the claims

25. Paragraph (c) of Article 18(1) calls for a summary of the parties' claims and the relief sought. It may be tempting to describe a party's claims in broad terms, but this may place the other party at a disadvantage if a new claim is presented. Although Article 19 is an improvement on its predecessor (by giving the tribunal greater discretion), it nevertheless still uses the 'limits of the Terms of Reference' as the basic criterion. Thus a balance must be struck and a summary should be devised that sets out the claims accurately without being too precise. For example, it should not be possible for a party to shift from claiming that there had been changes in the work needing to be valued in accordance with the contract to claiming that the changes had been brought about by unforeseeable conditions or ought to be seen as consequences of default or breach of contract by the owner. A summary permitting this without authorization from the tribunal would be unfair to the respondent party, as such new claims would almost certainly require inquiries and evidence of a very different nature. On the other hand, a summary should not necessarily tie a party to a particular legal basis for a claim or defence, as the true basis may not be immediately apparent. One way of achieving a suitable summary would be to define an issue by reference to the amount claimed (although not so as to make an increase a 'new claim'). A party ought usually to know how much it has lost or what it expects by way of compensation, even if the proof is not readily forthcoming. Regrettably, however, it is not uncommon for a party either not to know (or to profess not to know) the amount of its claim except in unrealistically round numbers, or to decide not to reveal the true amount for tactical or commercial reasons. A tribunal will therefore need to be presented with good reasons why it is not possible to establish the value of a particular claim.[Page17:]

The issues

26. Paragraph (d) of Article 18(1) calls for a list of the issues, unless the tribunal considers it inappropriate. We consider that such a list should be required in all but the simplest cases, not least because without such a list it will not be possible to decide on the future course of the arbitration. It is of course easy to define the issues in broad terms. However, a more detailed definition enables the ICC Court to check whether an award has dealt with all the issues before approving it and the tribunal to make certain that all the issues have been decided in the award before submitting it to the Court for approval. Besides, in construction arbitrations it may well be of no help to the parties (or the tribunal) to define the issues in broad terms if clear guidance is needed as to the issues for which proof or argument is required. Identifying those issues at an early stage is the primary task of the tribunal. For these reasons it is sensible for the tribunal to invite each party to set out its own list of issues before drafting the Terms of Reference. The aim must be to establish a clear and detailed summary of the issues since this could well promote a settlement.

27. However the nature and complexity of construction arbitrations means that the list of issues could be very long, and would not (or may not) serve a useful purpose. Thus we suggest that the objectives set out above might best be achieved by avoiding a lengthy list and instead including a working summary in the Terms of Reference. This would then be refined at the procedural or organizational meeting, which should take place as soon as the Terms of Reference have been signed, and at any further meeting thereafter. We are not in favour of actually combining the procedural meeting with the meeting at which the Terms of Reference are drawn up and signed, since discussions about procedure (in particular the timetable) can impede the settlement of the Terms of Reference.

Procedural rules

28. Paragraph (g) of Article 18(1) provides for particulars of applicable procedural rules. Unless the parties have already agreed on specific rules 13 or on what they do not want the tribunal to do, we recommend that in order to avoid prolonged (and probably unhelpful) discussions no attempt should be made to do more than describe the rules in the usual general terms, and to leave them to be worked out at the procedural meeting that must follow.

Procedural meeting

29. The ICC Rules of Arbitration give valuable guidance - and authority - in Article 18(4). It is clear that the establishment of a 'provisional timetable' may be separate from the drawing-up of the Terms of Reference. As we have stated, unless there is or is really likely to be agreement between the parties and the tribunal on the procedure and the timetable to be followed, we recommend that in construction arbitrations the Terms of Reference should first be signed (or at least initialled) by the parties or by those with authority to sign on their behalf, before the procedural meeting begins. The importance of the initial procedural meeting cannot be over-emphasized. It is vital to the creation of a sound working relationship, which may be [Page18:] further helped by additional procedural meetings held subsequently to monitor progress, achieve greater precision about the issues to be decided, and deal with matters that cannot be resolved by correspondence.14 The time and cost spent on such subsequent meetings can be worthwhile, but naturally they should only be held if needed.

Hearing date

30. We strongly believe that, at the time when the draft Terms of Reference are circulated, the tribunal should inform the parties of the likely date of the hearing and its duration, or at least the period during which the hearing will probably be held. If feasible, this is psychologically satisfying for a party that wants to know when an award might be made, and it helps the parties and the tribunal to prepare the Terms of Reference and the subsequent provisional timetable and procedural meeting. For example, it may have a bearing upon such matters as the desirability of a partial award or whether there could or should be more than one hearing. The actual date will of course depend on the parties' reactions to the tribunal's proposal and on the framework of directions given at or following the procedural meeting, after consultation with the parties. If procedural directions are agreed (which should be the aim of the tribunal), then the hearing date that emerges will almost certainly be acceptable to the parties. If a date cannot be agreed and has to be decided by the tribunal, then it should be the earliest date practicable for the parties (including their agents such as legal representatives, witnesses or experts). The tribunal will have to abandon the date originally envisaged by it if it cannot be met by the parties. However, the tribunal is not obliged to accept a date claimed by one of the parties to be the earliest practicable if, for example, it is satisfied that, with the deployment of reasonable resources, an earlier date acceptable to the other party and itself is feasible. Likewise, a tribunal should check the validity of an assertion that a proposed date or period is unacceptable to a party. To give two common instances: (1) another expert can frequently be found to replace one who, although appointed, has yet to do any substantial work and whose diary is full at the relevant time; (2) legal advisers are rarely irreplaceable or not interchangeable and their other commitments should not hold up a case.

Timetable

31. Although in most typical construction arbitrations it may well be difficult or impossible to devise a timetable that complies with the six-month time limit set in Article 24(1) of the ICC Rules of Arbitration, this is nonetheless the period for which the parties have contracted and it should not be ignored, especially where the dispute has already been processed by contractual dispute resolution machinery and has been the subject of settlement discussions (e.g. as required by the FIDIC conditions). The points at issue may then have been refined and be confined to those to be resolved by an award. If the dispute is of above-average complexity or requires more than one award, then the six-month period will be insufficient. In practice, the tribunal's suggested date is rarely questioned and, provided it has been chosen sensibly, establishes a framework for discussing the procedure. As already mentioned, the tribunal must of course take into account the financial position of each party (or those [Page19:] financially supporting it), so far as this can be ascertained, and the resources likely to be available to it. Many construction arbitrations require considerable resources to be harnessed if certain dates are to be respected. The tribunal must be sure that they are not beyond a party's means. Conversely, the timetable cannot be dictated by an impoverished party, nor should the tribunal be dissuaded from a feasible timetable by a plea that a party is having to answer for another, e.g. an employer for a now estranged engineer or a contractor for a sub-contractor. When fixing dates or any part of the provisional timetable, the tribunal should ensure that the parties have an opportunity to take stock and to negotiate, and some latitude must be allowed for human frailty.

Procedures

32. We considered a number of suggestions regarding the procedures that should be adopted in construction arbitrations. There is still an appreciable divergence between those used to the common law or 'adversarial' approach and those used to other approaches. This is typically illustrated by differing views on the role of the tribunal, although changes in national practices may help to narrow the gap. We do not think it useful to attempt to produce a synthesis based on some highest common factor, but rather to present the types of solution that might be adopted in most circumstances. In international commercial arbitration people from differing business and legal backgrounds and cultures are brought together to deal with a series of events that will rarely be so similar to the experience of all that everybody can agree on a common formula. It is more likely that a compromise will be needed, so we think it more fruitful to offer guidance as to viable options. We have already made it clear that, whatever courses are adopted, they must be cost-effective and must be seen to be so. Furthermore, a procedure may well be efficient in one country but not so effective when handled by those unfamiliar with it. The tribunal has a duty to maintain a dialogue with the parties throughout, so as to agree, whenever possible, the steps to be taken by the parties or the tribunal.

Points at issue

33. As already noted, the first objective must be to establish the true issues if they have not been precisely determined. At the end of the first procedural meeting, the tribunal should list the points requiring decision. Thereafter, as the case proceeds, it should revise and reissue the list in consultation with the parties, so as to guide them as to the topics to be covered in their written submissions and at any hearing, and to ensure that the tribunal is clear in its own mind about the points that it will have to decide and why they need to be dealt with in the award.

34. Where there has been a previous contractual dispute resolution process, or where the parties are apparently represented by competent lawyers who are familiar with construction disputes, or where the amounts in dispute are not large, there is a strong case for proceeding directly to proof. This means the parties will be required to present submissions accompanied by the evidence each considers necessary to establish its case (in the light of what is then known about the opposing case), both documentary and in the form of attested statements from witnesses. Unless the [Page20:] arbitration is to be of the 'fast-track' type, these submissions should not be submitted simultaneously but consecutively, with the claimant presenting its case first so that the respondent can reply to it. The timetable will therefore have to be fixed by the tribunal. The tribunal may then permit the parties to submit further submissions or evidence either of their own volition or to meet requests or instructions from the tribunal. (All evidence must of course be furnished to the tribunal and to the other party at the same time.) As a general point, submissions should be numbered or arranged so as to match those of the other party.

35. Once this stage is complete the tribunal may be better able to draw up a list of the issues as they appear to it and to guide the parties as to what is then required.

Further working documents and schedules

36. Some specialists favour the creation of a working document briefly recording the essential elements of each party's case, established from exchanges between them. This is best exemplified by the schedule used in English practice for typical claims for changes, disputes about the value of work and claims for work done improperly or not at all. Such a schedule can now be created electronically and conveyed by disk or by e-mail, so it need not be cumbersome to handle. In the right hands it is a useful tool. It defines the positions of the parties and ultimately it will or can be used by the tribunal to record its views and decisions. At the pre-hearing stage its main value is that, if properly compiled, it establishes the position of each party where the existing submissions or pleadings do not already do so adequately. Parties do not always present their cases in perfect form and the tribunal must expect to have to analyse the material presented to it. Moreover, the success of such a document depends in part on each party grappling and dealing positively with the principal allegations of the other party. For example, a respondent would be required to state specifically:

(a) which of the claimant's allegations are admitted;

(b) which of the claimant's allegations are denied (and why);

(c) which allegations cannot be admitted or denied (together with a brief explanation of the reasons) and which the claimant is required to prove.

In addition, a constructive approach must be adopted. If a respondent denies an allegation, the reasons for doing so must be given, and if it asserts a different version of events from that given by the claimant, then its alternative must be stated. Otherwise the claimant and the tribunal will not know the real nature of the respondent's case. The essential elements of this approach may be seen from a sample extract of a schedule annexed to this report.15

37. Where the claim is for numerous changes or variations and the statement of case and defence do not indicate where all the differences lie, the tribunal should order the claimant to state how each change came about, the extent of the work involved and any delay or disruption caused, why the respondent is liable, and how the amount claimed for each item (and for the consequent delay etc.) is arrived at. The respondent will need to reply to each head in its answer, stating whether it is admitted or not and, if not, why, including any different version of events it may have. Such a schedule is of particular value where a 'global' claim is involved, i.e. one [Page21:] where the claimant claims a period of time of delay or disruption and a sum said to be attributable to the overall effect of a series of events but maintains that a breakdown is impracticable. It is, ultimately, a question of substantive law whether and in what circumstances such a global claim is tenable. Even if the principle of such a claim can be upheld, a schedule may be of some help in determining whether, in the circumstances of the case, global delay or disruption did indeed occur and whether the causes for it can clearly be regarded as the contractual or legal responsibility of one of the parties to the dispute. A claimant should not be permitted to evade its responsibility to identify the causes of the delay or disruption and any likely identifiable effect. Global claims are easy to assert but difficult to examine, test and counter. Moreover, where a breakdown is provided, there will be less reason for a respondent to say that it does not understand the basis of the claim. Respondents sometimes profess ignorance despite knowing as much as claimants.

38. Complaints about faulty work are commonly presented using a similar schedule listing each item complained of and the precise legal basis for the complaint, e.g. non-compliance with a specified provision of the contract, or of the relevant governing law, the work required to put right the fault (and whether it has or has not been done), and the cost (or estimated cost). The respondent has then to state its case in answer to every point. Part of a sample schedule of this kind is annexed to this report.16 If fully and properly completed, these schedules show which points are not in dispute and thus irrelevant and which have to be decided. Schedules may also be used to extract the parties' cases on claims for delay (prolongation) and disruption, but they require special care to be effective. If the tribunal requires or sanctions the preparation of any such schedule, it must always define its status: e.g. is it just an aide-memoire, or does it replace or supplement any existing pleading or submission and, if so, what effect does it have on the issues to be determined and the amount of any claim (for example, for the purposes of calculating an advance on costs)?

39. Even if such a schedule is not used at this stage, it may be useful for one to be prepared (by the parties or the tribunal, or both) after the first exchange of evidence or before the hearing takes place, so as to find out what then needs investigating and deciding. It is particularly helpful on matters of valuation and quantification. Much time can be saved if the true gap between the parties can be revealed, without prejudice to the parties' other contentions, e.g. that a respondent is not liable.

Tests

40. If a complaint concerns the unsuitability or malfunction of a plant, equipment or work, the tribunal will need to ascertain what tests have already been carried out and whether the results have been agreed or are sufficient for the purposes of the arbitration. It may be necessary to order new tests under conditions that are either agreed to be or are likely to be representative of the conditions of use.17 Sometimes the parties will have recognized the need for such tests and already have made arrangements. In other cases the parties will look to the tribunal to sanction such tests (so that, for example, a party's wishes can be endorsed by the tribunal or the basis for apportioning costs be fixed pending some further or final determination of liability for them).18 Although in the majority of cases a tribunal will seek to persuade a party of the value of a test, any such test must be non-destructive, if made without the consent of the party whose property is affected. The tribunal cannot and should [Page22:] not order any other tests of its own volition. Tests which the tribunal considers necessary and which are not permitted by the party that owns the property will have to be conducted by or for the tribunal elsewhere (assuming they will still be practicable and of value if carried out off-site), either as part of the tribunal's obligation to ascertain the facts (Article 20(1), ICC Rules of Arbitration) or by an expert appointed by it pursuant to Article 20(4). These recommendations apply whether the tests are carried out by an expert appointed by the tribunal or by a party. It should be noted that once an arbitration has started any test carried out by an independent expert appointed by a party should be carried out jointly with any other expert and under the direction of the tribunal. Similar constraints apply to site inspections.

41. In some instances it can be very helpful to combine joint tests at a plant with a visit by the tribunal, provided that there have been no material alterations since completion and that the operating conditions are representative of those contemplated when the contract was made. Visits can be expensive and difficult to arrange at a time convenient to the parties and their advisers, especially if the tribunal comprises three people. They are nonetheless valuable, as they enable the tribunal to be better informed and to gather evidence, particularly if it observes the tests or receives other evidence, e.g. from experts. A tribunal is often helped by being given in advance a non-contentious description of the site, working methods, and any processes involved, which the parties will have agreed as a neutral document. Videos or photographs - even if created for promotional or other historic or extraneous purposes - can also be useful, particularly where they show what can or can no longer be seen. The parties may agree that only one member of the tribunal might visit to obtain evidence but suitable arrangements will need to be made so that the parties are aware of what is reported to the other members. As a general rule, all visits must be justifiable in terms of both their utility and savings in arbitrators' fees and parties' costs.

Programmes and Critical Path Networks

42. Construction disputes often involve claims for delay and disruption that involve large sums of money and require careful handling. It is important that the events which caused such delay and disruption be clearly identified and that those that did not be isolated. Of the methods which can be used to identify such events and their effects, the most important and well known is the Critical Path Network (CPN) technique. CPN is a graphic presentation of the planned sequence of activities in the construction of a project showing their interrelationship and interdependency. It is a computerized project-management tool that enables a decision-maker to modify the sequence of work for the purpose of effective and efficient completion of the project. CPN can incorporate all the resources required - both human and material - to carry out the works as planned. It can also identify the effects of events that occur during construction on the progress of the work and show where any delay or disruption may have occurred and where it could not have occurred.

43. Therefore, in projects where CPN techniques have already been used to manage the construction process and monitor its progress, CPN provides an excellent tool for establishing the causes and effects of delay. This is generally done by comparing the programme as contractually planned with the programme as constructed.19 Thus a claimant who claims an extension of time beyond the actual date of completion [Page23:] should be asked at an early stage of the proceedings to specify the method to be adopted to determine the causes of the delay or disruption.

44. Whilst it is for the parties to determine the method that they will use to present their cases, a tribunal would now expect them to use CPN techniques for this purpose if such techniques had been used during the construction. Indeed, there would have to be a good reason not to use them. However, CPN analyses can be very expensive, so their use must be confined to situations where the results would be useful and of value. Computer operating software is required and data needs to be entered. Various software packages exist, each with its own characteristics and peculiarities. Use of a CPN method retrospectively in projects where the techniques have not actually been used during the construction process can lead to difficulties. Since the creation of such a CPN has to be based on certain assumptions, relating in particular to the logic of the network, it is particularly difficult and risky to construct a CPN retrospectively. The logic and all other data entered into the CPN software must, of course, be fully disclosed and be open to argument and possible challenge. It quite frequently happens that many of the numerous assumptions that have been made in the construction of such a retrospective network are in the end so controversial that the network cannot be accepted by the tribunal for the purposes for which it was created. Similarly, unless accepted by a respondent, a claimant who based its case on its own programme should be required to justify that its programme would have been achieved, but for the events complained of. The respondent should then be required to explain why the claimant's analysis is incorrect. In this way the points that truly require investigation will emerge. These are not matters to be left to experts, since they define the agenda and create the terms of reference for experts and for evidence. It is important to exclude irrelevancies as early as possible, in order to avoid spending time, money and energy on matters that are of no consequence and sometimes misleading.

Computation of claims

45. It is also important to discover what needs to be investigated in the computation of a claim. In many cases reasonable pressure on both parties will elicit where there is real disagreement and, more importantly, why it exists. If evidence justifying the amount of a claim has not already been provided in the statement of case (or prior to the proceedings), a claimant ought to be required to produce the primary documents that confirm the amounts claimed, cross-referenced to the statement of case and in a form that will readily enable the respondent to know where the amounts come from and why they were incurred. The respondent will then have no excuse for not stating the reasons why liability does not exist or, if it does, why the amounts claimed are nevertheless not due, e.g. because they were not caused by the events, were not incurred, were not reasonably incurred or because the terms of the contract or the provisions of the applicable law preclude their recovery. In each case the reasons should be given.

46. If steps such as these are followed, it ought to be possible to provide the framework for the directions that the tribunal will give and to confine the areas of inquiry to what really matters. It may be added at this point that, whenever appropriate, all applications about procedural matters not involving questions of substance should be made and decided by correspondence or telephone without a hearing. [Page24:]

Practicability of steps

47. In practice it is not always possible (or desirable) to discuss procedure without knowing how much time will be allowed for each step. Thus it may not be possible to draw up the provisional timetable 20 until the steps required have been settled. Many respondents emphasized the need to establish and maintain a strict timetable. Hence, the tribunal should not give directions unless satisfied that they are practicable in terms of time. In complex cases it would be sensible to hold at least one further procedural meeting at which the timetable would be reviewed and difficulties discussed. Sometimes it may be desirable merely to outline a timetable, leaving future steps to be dependent on progress, e.g. the report of a tribunal-appointed expert, obtaining documents from a third party, or the result of an award.

48. The tribunal should not be deceived into thinking that a step can be carried out within a certain time provided sufficient resources are found. Throwing people at a task is rarely efficient and is usually unnecessarily costly. In drawing up the timetable the tribunal should always bear in mind that there must be latitude or 'float' in case there is slippage. A step which has to be completed before a holiday period should be timed to be done well in advance. The timetable must permit the parties to consider the possibility of settlement. The arbitration should not be driven at such a pace that there is no breathing space. A tribunal should therefore always ask the parties if, for example, the timetable should allow for discussions, e.g. after the exchange of evidence. Time must also be set aside for the tribunal to be able to read all the material before any hearing. If the material is voluminous, the tribunal should ask the parties (1) which parts it is absolutely necessary to read before the hearing, (2) which should preferably be read and (3) which need not be read beforehand. In construction arbitrations, time spent by the tribunal in pre-hearing internal discussions is usually time well spent so the timetable must allow for this, as it must also allow for post-hearing discussions. An arbitrator who allows other engagements to shorten or interrupt pre- or post-hearing discussions does not provide a proper service to the parties or to the other members of the tribunal. Finally, a timetable agreed by the parties and the tribunal is always to be preferred to one imposed on the parties, not least because a party that has agreed a timetable will get scant sympathy from the tribunal if it fails to comply with it for a reason which was or ought to have been known to it.

Splitting a case

49. Unless the parties agree or there are obvious legal reasons for doing so, decisions about splitting a case into parts should be left until it is clear that it will be sensible and cost-effective to do so. Proper management of many construction disputes requires them to be taken in stages, e.g. jurisdictional or quasi-jurisdictional issues, such as the admissibility of claims; pivotal issues of liability; and quantum to the extent that its investigation proves to be needed. However, such management decisions must be intelligent, based on a sound appreciation of the case and be taken at the right time. It might seem attractive to decide whether certain claims are admissible under the contract through alleged want of notice but that course is only worthwhile if a decision unfavourable to the claimant will inevitably dispose of a substantial part of the case. It is not so attractive if the claim resurfaces under an [Page25:] alternative head and the claimant's losses prove, on analysis, not to be attributable to the claims that have been barred. Similarly, dividing a case into issues of liability followed by issues relating to quantum needs to be carefully considered and defined since in many instances causation could fall into either part. Before a decision is made about splitting a case, the claimant's case on both causation and quantification should be known, so that it is clear how the costs and losses are purported to have arisen. The tribunal should be sure that a decision favourable to the claimant on liability and causation will have significant financial consequences. If it is not sure of this, then it should not split a case, as one of the key reasons for a split is that a partial award is likely to lead to agreement on the remaining issues. Equally, a tribunal must be satisfied that, if a decision were taken to examine the apparent basis in fact or law of a claim and if that basis were rejected, the claimant would not be able to present an alternative fallback case.

50. These factors do not of course apply with the same force to the handling of purely legal issues, where they present no particular problems. Also, it may be desirable for the tribunal to discuss with the parties from a very early stage the possibility of resolving non-essential issues in a relatively informal manner. Indeed, provided that the parties agree,21 the tribunal should seize every opportunity to give an indication of its views on minor (and not so minor) matters, for such provisional indications can help the parties to resolve them. This should certainly be done prior to and at the hearing.

Documents

51. In this report documents include information stored electronically. The tribunal will need to ascertain at the outset whether it is practicable to work from printouts or whether it would be better if the material were accessed directly by the tribunal, in which case it will be necessary for the tribunal and every other party to be provided with the necessary software. The tribunal may also have to establish confidentiality protocols limiting access to the parties' legal advisers or experts, especially if the contract works cover operating systems that are patented or otherwise commercially sensitive.22

52. A striking number of respondents considered that construction arbitrations continue to be blighted by excessive documentation. We would have thought that experienced arbitrators and practitioners now knew how to prevent arbitration proceedings from being swamped by the mass of documents that are inevitably generated by a construction project. Few are still in favour of the wholesale and indiscriminate production of documents by means of the common law process of discovery (whether the English version or the United States version). In any event, such a process as practised in domestic fora must be justified if applied to an international arbitration. Otherwise, it has no place in ICC arbitrations. The tribunal should make it clear at the outset that the documents should be directly relevant to the issues as defined by the tribunal and should be confined to those which a party considers necessary to prove its case (or to dispose of the case of the other party) or which help to make the principal documents comprehensible. To this end we consider that the tribunal should consider directing the parties to state, when producing principal documents (or at least in any pre-hearing submissions), what each is intended to prove, as there was general agreement that the parties should first be [Page26:] required to ensure that they have produced all the documents which are needed for proving the points at issue. Another helpful method is to create separate files (hard or electronic) or bundles of documents for each main issue. These can be added to as the case proceeds. If the document is long or may be used for more than one purpose, then the relevant part(s) should be highlighted. If they have been identified in the ways suggested above they should be relatively limited in extent. The tribunal may also consider requiring each party to notify the other if it does not agree that a document provides the necessary proof, so that alternative means of proof can be found, if necessary. The procedure described above precludes a party from relying on other documents, e.g. for the purposes of confronting or challenging a witness or other evidence.

53. Some of the suggestions for keeping documents under control could be tantamount to an admission of defeat, e.g. computerized document management allowing direct access to quantities of documents that would ordinarily be too voluminous to handle. We doubt if such arrangements would avoid the vice of many construction arbitrations, namely that of not deciding which documents are really relevant and necessary (as opposed to those which might possibly be needed). On the other hand, scanning selected documents so that they can be viewed in their original form can be justified in some instances. It is now possible to load on a CD-ROM material such as pleadings, submissions, witness statements and reports from experts, plus extracts from some of the primary documentation. The tribunal should inquire whether, for example, the contract documents and correspondence are still in files or documents which can be transferred or copied (albeit with some loss of data) to the CD-ROM. Where such measures are not implemented and photocopies are used, we consider that, consistent with an expectation that documents will be kept under control, the tribunal should in any event direct the parties from the very outset to organize the documents so as to avoid duplication and to allow them to be accessed easily, e.g. through the compilation of working files with a common numbering system. Such a procedural direction will need to be clear and precise since this useful practice is not yet widely recognized. For example, whether photocopied or on disk, inter-party correspondence (including instructions, requests for instructions and the like), the agreed records of meetings, programmes, agreed summaries of measurements, agreed summaries of valuations, drawings, details and other technical documents ought to be contained in separate indexed files with the pages individually numbered so that additions can be made simply.23

54. The tribunal is entitled to call for further documents at any time, in order to fulfil its duty to ascertain the facts. The parties will obviously be given copies and the opportunity to respond. The procedural rules ought also to allow a party to request additional documents from another party and, if not provided, to seek an order from the tribunal, at which stage the legitimacy or reasonableness of the request and the refusal will be decided. Most parties comply with an order if it is made clear that the sanction for failing to do so is the risk of an adverse inference being drawn.24 The tribunal should be aware, however, that its requests for documents may sometimes convey the impression that it is inclined towards the party that may benefit from its seeing the documents, especially if its order directly or indirectly supports a prior request by that party.25 The tribunal may need to make it clear that it remains completely impartial and that it is simply discharging its duty under Article 20(1) of the ICC Rules of Arbitration.[Page27:]

55. The tribunal must also provide guidelines for the hearing. If a CD-ROM is used or common working files have been created, as described above, there should be no need to isolate 'core' documents. The primary letters and instructions central to the issues of liability and causation as well as other key documents, such as programmes, will already be accessible to all. The tribunal should fix a cut-off date by which no further documents may be produced by any party, unless required by the tribunal, or permitted by it in exceptional circumstances following a reasoned justification for late submission, as when a party discovers a material document which the other party has been withholding.

Witnesses

56. The law governing the proceedings or the wishes of the parties may have an impact on the taking of oral evidence. For example, the laws of many Arab countries forbid recourse to documents in support of oral testimony. Subject to these important factors, evidence which is not contained in a document but which is necessary to prove or disprove a point at issue must normally be presented through a written statement from the witness, in that witness's own words (unless the witness is incapable of this), verified and signed by that witness. If the evidence is not in the language of the arbitration, an accredited translation must be provided. If the statement deals with technical or legal matters, the tribunal should ensure that the translator is both qualified and familiar with the subject matter; otherwise the translation may be not only useless but, even worse, misleading. If it is not possible to tender a written statement, then the permission of the tribunal will be needed before evidence is heard from that person. Since it is desirable that the whole of a witness's evidence should be in writing and since evidence tendered by one party may cause another party to reconsider its proposed evidence and to submit additional evidence, perhaps from a person who has not already provided a statement, it is usually sensible to allow for supplementary or additional statements of evidence of fact 26 to be submitted within a brief period following the principal statements, so that all the evidence is in writing. All witness statements should be provided in good time before the preparation of any pre-hearing submissions.

57. A witness will be heard only if required by a party or by the tribunal to attend for questioning. The tribunal may however ask a party to state why a witness is required and to specify the areas in which questioning is to be conducted so as to ensure its relevance and necessity. The tribunal may impose reasonable limits on the time available to a party for the questioning of witnesses.

Experts

58. First, the tribunal may decide to appoint its own expert to assess technical points and to guide it in its own investigations. Article 20(4) of the ICC Rules of Arbitration deals with the appointment of such experts. Where one or more members of the tribunal have been nominated or appointed for their expertise, there should normally be no need for the tribunal to duplicate that expertise by appointing its own expert in the same field. However, construction disputes often raise a wide variety of technical issues, some of which may be highly specialized and lie beyond the competence of an ordinary expert and others may necessitate a decision between [Page28:] two different schools of thought, towards one of which a tribunal member may have a leaning, as a result of training or experience. It is therefore important that, before the tribunal uses the expertise of one of its members, the other members are satisfied not only that any expert member is truly independent and free from any apparent or unconscious bias, but also that the issues are likely to be within his or her competence.27 A tribunal should guard against giving an arbitrator with special qualifications undue influence in any discussions between its members. However, such an arbitrator is likely to be of considerable value in helping the tribunal to understand the points at issue and to communicate with the parties and experts. The parties may expect that in such situations the tribunal will appoint an expert to advise it, especially if the parties (in their written submissions or through reports from their own experts) have not provided adequate technical information. The appointment of its own expert by the tribunal may also be expected and justified where the assessment of part of the case might take a considerable time, e.g. the examination of a complex network analysis. Where therefore the appropriate expertise is available within the tribunal, a decision not to appoint its own expert should normally be discussed with the parties since, for example, it might be thought that a member of the arbitral tribunal nominated by one of the parties ought not to supplant a tribunal-appointed expert, although in principle no difficulties should arise if that member were truly independent.28 He or she would then be able to assist the other members of the tribunal in understanding the technical aspects of the case and in drafting the relevant parts of the award. However, as we have pointed out, precautions must be taken to see that the technical knowledge and views of one of the arbitrators that may influence the tribunal have been communicated to the parties so that they have a proper opportunity of dealing with them by submissions or evidence.

59. Secondly, in construction arbitrations there can be confusion about whether or not expertise is required so it is always prudent to clarify the position. One party might assume that expert evidence will be required to deal with a matter which another would regard as requiring proof from documents or a witness. It is also sometimes assumed that the tribunal will appoint an expert and that a party will be called upon to produce an expert only if dissatisfied with the tribunal's report or if further proof is required. The tribunal should therefore always consult the parties at the first procedural meeting to find out whether they are both intent on tendering evidence from experts and why such expertise is required. For instance, it may be that the experts are being used as advocates and that proof should be provided in another way. In a case where the opinions of experts are important and any differences are not attributable to different perceptions of the facts, the tribunal's own expert may only be needed once the points of disagreement between the parties or their experts have been clearly identified. In such circumstances the tribunal should appoint its own expert only if necessary since the costs of this expert have to be borne by the parties. There may however be cases where the parties will be saved considerable time and expense if the tribunal appoints its own expert, as the expert's opinion might render unnecessary any further expertise or identify points upon which evidence or reports from witnesses or experts may be required.29 Any report or other communication with such an expert must of course also be transmitted to the parties at the same time as it is sent to the tribunal. As to timing, the tribunal ought normally to decide whether it will appoint its own expert before it issues the provisional timetable under Article 18(4), since the timetable will be affected by the work of the expert. If the tribunal is unable to decide at that stage, it will no doubt [Page29:] inform the parties at the procedural meeting, before establishing the provisional timetable, so that they can take account of the possibility that an expert may yet be appointed by the tribunal.

60. Thirdly, it is now common in international construction arbitrations for parties to use consultants 30 from a very early stage in the preparation of claims. Such consultants often provide expert knowledge in certain aspects of the dispute, such as programming, quantification or special areas of engineering. Sometimes they also appear as the parties' experts, providing reports and giving evidence at the hearing. They should be distinguished from experts unconnected with the parties, such as specialists renowned for their expertise in a specific area, although the dividing line is not always clear. The tribunal will need to bear this distinction in mind when assessing the weight of the opinions presented to it. For example, it will wish to be sure that all information which a consultant expert of the former kind obtains from a party and which is at all relevant to the evidence or any opinion has been fully communicated to and is known to the other party or parties and to the tribunal. The proximity of such an expert to a party may be significant.

61. Fourthly, if the parties wish to present evidence from experts, then the matter must be discussed with the tribunal, which must check the scope of the evidence so as to ensure that it is confined to the issues and does not deal with matters capable of being proved in other ways. A solution would be for the tribunal to draw up the terms of reference of the experts (on the basis of the issues known to it) or to request the parties to agree a statement of the issues and facts (both agreed and assumed, e.g. as set out in the witness statements) upon which expert evidence is required. Failing this, the experts should provide the tribunal with the terms of reference or instructions they have received from their clients (subject to privilege), so as to enable it to check that clear directions and explanations have been given, in order to obtain a reliable opinion. It is desirable that independent experts - whether acting as expert witnesses or as technical consultants - should discuss their views with each other before preparing their reports, as they should eventually agree about most things if truly independent. This they could do at a meeting possibly chaired by the tribunal or, if the parties agree, a designated member of the tribunal. If no discussions are held before the reports are presented, they should certainly be held afterwards. Again, the tribunal may perform a valuable role in determining to what extent the reports converge. It may not always be necessary for the parties to be represented at such a meeting,31 and there is normally no reason why any discussion between the experts themselves need be attended by anyone else. The tribunal must ensure that it is clear whether or not agreements between the experts bind the parties. If the tribunal were to chair discussions between the experts, it could be difficult for a party to question such an agreement. In any event, the reports must be confined to what is not agreed. Too many reports are burdened with what is already known and accepted and do not concentrate on the reasons for differing opinions. Reports should be exchanged and, if necessary, supplementary reports drafted.

Hearing

62. Here, the responses we received showed interesting differences. There was general agreement that the tribunal should decide as early as possible in which order the main issues should be heard and whether certain issues should be decided in a [Page30:] partial award before other issues are heard. It was suggested that the tribunal should persuade the parties to agree that some issues be decided on the basis of written submissions and evidence only. Whilst the tribunal may suggest such a course, we believe however that the parties should be free to decline. The tribunal is not always best placed to see that some issues have to be the subject of a hearing. In all events, the tribunal should inform the parties if it thinks that a witness or an expert need not attend the hearing to be questioned. It should also require the parties to state whether any witness or expert put forward by the other party is not required (in which case the evidence will be accepted subject to a decision as to its value) and to inform the tribunal why a person is required for questioning and the topics to be covered by such questioning.32

63. We have already covered many steps that will be taken before the hearing. There is general agreement, first, that all submissions prior to the commencement of a hearing should be in writing and, second, that either minimal time should be allowed at the hearing for opening statements or that there should be no opening statements at all. The latter course should however be taken only if the parties agree, as many clients wish to hear their case presented. If little or no time is given to opening statements at the outset then, unless the parties agree, sufficient time must be found for statements before the hearing closes, otherwise the parties might be deprived of the hearing to which they are entitled under Article 20(2) of the Rules of Arbitration. In common with general practice in international arbitration, written submissions should be full but concise, and they should be delivered at the earliest possible occasion. They should be numbered or arranged to match the submissions of the other party. Much antipathy was shown to the common law practice of not presenting the best case in the best possible way and relying on oral submissions, accompanied by supporting notes. This practice is particularly to be avoided where members of the tribunal or the legal or other key representatives of the parties require time to adapt to the language of the arbitration. They need to have written submissions in advance in order to read them carefully at their own pace. In addition, using written material wherever practicable reduces the time required at a hearing or meeting.

64. There was also general agreement that either the tribunal should require the parties to decide how the time available within the period of the hearing should be allocated (in which case the parties will then be held to their decision), or the tribunal should itself decide and adhere to a strict timetable (although not of course if to do so would be unjust - the tribunal must always be ready to be flexible). The tribunal must treat each party fairly, but that does not mean equality in terms of witness time, as opposed to the time for statements or submissions. Although it is commonly suggested that the hearing time should be divided equally between the parties, we do not consider this to be necessarily appropriate in construction disputes. For example, if a claim is solely about whether a contractor was delayed, then the evidence in support of that claim is likely to require more investigation than the employer's evidence which may well be quite limited.

65. Prior to the hearing the parties should be required to agree which documents will be needed at the hearing. If not already conveniently available, they should be put on CD-ROM or assembled in the form of files.33 Pre-hearing submissions, witness statements and any reports from experts should be cross-referenced to the documents.[Page31:]

66. There was much support for the view that factual witnesses should be heard before the experts formally present their reports and are questioned on them, since the questioning of a factual witness may lead an expert to a better understanding and to the modification or withdrawal of an opinion or provisional conclusion. It was also thought that, where the parties are to tender experts or witnesses on the same topic, they should be questioned together so as to clear up misunderstandings that may have arisen between them. As we have already observed, such time can be minimized if the experts contact each other well before the hearing to resolve discrepancies. As regards witnesses of fact, it may be expected that, as part of the continuing dialogue with the parties, the tribunal will study the statements as they are filed and raise discrepancies with the parties so as to clear them up before the final experts' reports and written submissions are presented prior to the hearing. On the other hand, it may sometimes be desirable for the tribunal-appointed expert to present his or her report and to be questioned on it before any other evidence is heard, even though this may give the impression that the conclusions of that expert will be accepted by the tribunal unless discounted. The tribunal must obviously ensure that the decisions that it takes are its own and not those of any expert appointed by it.

67. The time available at a hearing need not be used for closing submissions as they are frequently best presented in writing within a short period after the conclusion of the hearing. However the tribunal should always allow itself time to raise questions and, unless otherwise agreed by the parties, give the parties an opportunity to address it on points which need then to be emphasized. As an alternative, it may occasionally be helpful to the tribunal for a short hearing to be held after the closing submissions, for the purpose of obtaining clarifications. The deadline for the delivery of closing written submissions should preferably be set by the tribunal well before the hearing (e.g. in the provisional timetable) and certainly in good time prior to its conclusion, so that the hearing is conducted on that basis and the parties can make the necessary arrangements. No further submissions will be considered once the deadline has passed. When declaring the proceedings closed, pursuant to Article 22 of the Rules of Arbitration, the tribunal should make it quite clear that no new facts or opinions will be admitted thereafter, unless specifically requested by it. There is a tendency for parties to try to repair gaps in their cases by submitting new documents, statements and reports, on the pretext that their action was 'authorized' by the tribunal (as provided by Article 22). If this occurs, the tribunal should immediately send such submissions back to the parties.[Page32:]

Summary of Main Recommendations and Suggestions 34

Composition of tribunal

1. The tribunal should comprise people with proven experience in seeing how an international arbitration about a construction dispute is carried through from start to finish. [18]

2. Sole arbitrators or chairmen should know how to write awards and should be able to construct an effective management framework for the arbitration. [17-18]

3. Some familiarity with computers is a distinct advantage, if not a necessity, and basic word-processing skills are now virtually indispensable. [15-16]

4. At the tender stage of projects whose value is not more than, say, 20 million US dollars,35 the parties should consider whether their interests would be best served by the appointment of a sole arbitrator. They should also consider appointing a sole arbitrator if the value of the claim is not large. [19]

Steps available prior to Terms of Reference

5. The tribunal should obtain a chronology of events from each party, especially if there are claims for delay or disruption. On the basis of the material provided by the parties, it should itself prepare a composite chronology which it should send to the parties. Any discrepancies should be taken up with them. The tribunal should thereafter maintain the chronology, amending it as the case develops, circulating revisions, and asking the parties to resolve any gaps in it. [21]

6. The tribunal should not hesitate to seek information to enable it to create organizational charts, layouts and glossaries, or to obtain other clarification for the purpose of defining a claim or an issue. [22]

7. Amplification of submissions may be needed where, for example, a party has not anticipated a point raised by the other party or which the tribunal sees as likely to arise, concerning for example:

7.1 the jurisdiction of the tribunal, e.g. the identification of a contracting party;

7.2 whether or not notice of intention to claim has been given, if required by the contract;

7.3 whether or not a claim or defence is barred in law, e.g. by prescription or limitation;

7.4 whether or not a claim has been referred to, considered or decided by an engineer, DAB or DRB, or whether notice of dissatisfaction has been given (e.g. under the FIDIC conditions);

7.5 the amount of the claim, where unclear.[Page33:]

However, a tribunal is under no obligation to seek clarification for the purpose of drawing up the Terms of Reference. There may in some cases be points which should be left until later. In particular, a tribunal should be wary of asking a party to clarify the legal basis of a claim or defence, as this may be a matter for the tribunal to determine or for the other party to refute. [22-23]

Terms of Reference

8. A list of issues will be needed in all but the simplest cases, not least because without such a list it will be impossible to decide on the future course of the arbitration. [26]

9. To define issues in broad terms may help neither the parties nor the tribunal in construction arbitrations, where clear guidance is needed on the issues for which proof or argument is required. Extracting those issues at an early stage is the primary task of the tribunal. For these reasons it is sensible for the tribunal to invite each party to set out its own list of issues before drafting the Terms of Reference. A very lengthy list would be counterproductive however, so a working summary should be set out in the Terms of Reference and refined at the subsequent procedural or organizational meeting. That list should be revised and reissued by the tribunal in consultation with the parties as the case proceeds, e.g. at any further procedural meeting. [26-27, 33]

10. Unless the parties have already agreed on specific procedural rules, no attempt should be made to do more than describe the rules in the usual general terms. They should be left to be worked out at the procedural meeting. [28, 32]

Hearing date and timetable

11. The tribunal should inform the parties of the likely hearing date when the draft Terms of Reference are circulated, so as to facilitate agreement on the date proposed. If a series of hearings are planned, the likely date of the opening hearing should be proposed. [30]

12. If a date cannot be agreed and has to be decided by the tribunal, then it should be the earliest date practicable for the parties. Although in most typical construction arbitrations it may well be difficult or impossible to devise a timetable that meets the six-month time limit set in Article 24(1) of the ICC Rules of Arbitration, that period should not be ignored. Where contractual dispute resolution mechanisms have already come into play and settlement discussions taken place, the points at issue may have been refined, leaving the award as the sole remaining matter. In such instances, unless the dispute is of above-average complexity or requires more than one award, the likelihood of abiding by the six-month time limit will be greater. In settling a date (and also the procedure), the tribunal should take into account the financial position of each party (or those financially supporting it), insofar as this is known or can be inferred, and the resources likely to be available to it. [30-31]

13. When scheduling dates, whether for the hearing or any other part of the provisional timetable, the tribunal should ensure that the parties have opportunities [Page34:] to take stock and negotiate and that there is leeway in case of slippage. [31, 47, 48]

14. Time must also be set aside for the tribunal to be able to read all relevant material before the hearing (or any subsequent procedural meeting). [48]

Splitting the case

15. Decisions about splitting a case into parts should be left until it is clear that it will be sensible and cost-effective to do so. [49]

16. Before a decision is made about splitting a case, the claimant's case on both causation and quantification should be known, so that it is clear how the costs and losses are said to have arisen. The tribunal should be sure that a decision favourable to the claimant on liability and causation will have significant financial consequences. If it is not, then it should not split a case, as one of the key reasons for a split is that a partial award is likely to lead to agreement on the remaining issues. Equally, a tribunal must be satisfied that, if a decision were taken to examine the apparent basis of a claim in fact or law and if that basis were rejected, the claimant would not be able to present an alternative fallback case. [49, 50]

Procedure after the Terms of Reference

17. The meeting at which the Terms of Reference are drawn up and signed should not be combined with the first procedural meeting, since discussions about procedure and in particular the timetable can impede the establishment of the Terms of Reference. It is recommended however that the first procedural meeting take place on the same occasion and follow immediately afterwards. [28-29]

18. In complex cases it will be sensible to hold at least one further procedural meeting at which the timetable will be reviewed and difficulties discussed and the list of issues reconsidered. [33, 47]

19. In cases where there have already been prior discussions, serious consideration should be given to proceeding directly to proof by requiring the parties to present submissions accompanied by the evidence that each considers necessary to establish its case in the light of what is then known about the opposing case. Evidence may be both documentary and in the form of attested statements from witnesses. Unless the arbitration is 'fast-track', these submissions should not be submitted simultaneously but consecutively, with the claimant presenting its case first so that the respondent can reply to it. The tribunal will therefore need to fix a timetable, and possibly allow the parties to submit further submissions or evidence either of their own volition or in response to the tribunal's requests or directions. Once this stage is complete the tribunal will be better able to draw up a list of the issues as they appear to it and to guide the parties as to what is then required. [34, 35]

Further working documents and schedules

20. Some specialists favour the creation of a working document briefly recording the essential elements of each party's case, established from exchanges between [Page35:] them. These 'schedules' are best used for typical claims for changes, for disputes about the value of work and for claims for work done improperly or not at all. They have the advantage of being able to be created by computer and conveyed on disk or by e-mail, which makes for ease of handling. If fully and properly completed, schedules identify points that are not in dispute or irrelevant and thus expose those that have to be decided. Schedules may also be used to extract the parties' cases on claims for delay (prolongation) and disruption, but they require special care to be effective. Schedules are of particular value where claims are of a 'global' nature. [36-38]

21. Even if not immediately used, it may be helpful for a schedule to be prepared (by the parties or the tribunal, or both) after the first submission of evidence or before the hearing takes place, so as to identify what then needs investigation and decision. [39]

Tests

22. Where a complaint is about the unsuitability or malfunction of a plant, equipment or work, the tribunal will need to ascertain what tests have already been carried out and whether the results are agreed or sufficient for the purposes of the arbitration. [40]

23. The tribunal should sanction tests that have not already been carried out, but must be sure of the time needed for them. Although in most cases a tribunal will seek to persuade a party of the value of a test, any test required by it must be non-destructive if made without the consent of the party whose property is affected. The tribunal cannot and should not order any other tests of its own volition. Tests which the tribunal considers necessary and which are not permitted by the party that owns the property will have to be conducted by or for the tribunal elsewhere (assuming they will still be practicable and of value if carried out off-site), either as part of the tribunal's obligation to ascertain the facts (Article 20(1), ICC Rules of Arbitration) or by an expert appointed by it pursuant to Article 20(4). These recommendations apply whether the tests are carried out by an expert appointed by the tribunal or by a party. Once an arbitration has started, tests performed by an independent expert appointed by a party should be carried out jointly with any other expert and under the tribunal's direction. Similar constraints apply to site inspections. [40]

Visits

24. It can be very helpful to combine joint tests with a visit to the plant by the tribunal, provided there have been no material alterations since completion and that the operating conditions are representative of those contemplated when the contract was made. [41]

25. Visits can be expensive and difficult to arrange at a time convenient to the parties or their representatives, especially if the tribunal comprises three people. All visits, like tests, must be able to be justified by their benefits and cost-savings. [41] [Page36:]

Programmes and Critical Path Networks

26. Claims for delay and disruption require careful handling. It is important that the causative events are clearly identified and that any events which did not delay progress are isolated. The use of Critical Path Network (CPN) techniques generally facilitates this process and should be required by the tribunal provided they have already been used in the management of the project. To construct a CPN retrospectively, if it has not been used previously in the project, is an expensive exercise and can produce unhelpful or misleading results. Care must therefore be taken and the processes must be fully transparent. The parties and the tribunal must be informed of the logic at the basis of the CPN, the assumptions made and the data entered. A further requirement is that they all have access to the software used for the preparation of the CPN and its application. [42-44]

Computation and quantification of claims

27. If no evidence has already been provided in the statement of case (or prior to the proceedings) to justify the amount of a claim, a claimant ought to be required to produce the primary documents in support of the amounts claimed, cross-referenced to the statement of case, and in a form that will readily enable the respondent to know where the amounts come from and why they were incurred. The respondent will then have no excuse for not stating the reasons why liability does not exist or, if it does, why the amounts claimed are nevertheless not due, e.g. because they were not caused by the events, were not incurred or not reasonably incurred. In each case reasons should be given. [45]

Documents and document control

28. The common law process of discovery as practised in domestic fora has to be justified if it is to apply to an international arbitration. Otherwise it has no place in ICC arbitrations. [52]

29. Documents produced by a party should be directly relevant to the issues as defined by the tribunal and should be confined to those which a party considers necessary to prove its case or dispose of that of the other party, or which help to make the principal documents comprehensible. [52]

30. When producing a document (and if not then, certainly in any pre-hearing submissions), the parties should be instructed to state what it is intended to prove, given the general agreement that the parties are first required to produce all the documents needed to prove the points at issue. [52]

31. The tribunal may obviously call for further documents at any time in order to fulfil its duty to ascertain the facts. The procedural rules ought also to allow a party to request additional documents from another party and, if these are not provided, to seek an order from the tribunal, which will consider the legitimacy or reasonableness of the request and the refusal. [54] [Page37:]

32. The tribunal should set a deadline after which no further documents may be produced by any party, unless required by the tribunal, or permitted by it in exceptional circumstances following a reasoned justification for late submission. [55]

Document management

33. Material such as pleadings, submissions, extracts from the key primary documentation, witness statements and reports from experts should be loaded on a CD-ROM. [16, 53-55, 65]

34. The tribunal should in any event require the parties to organize documents so as to avoid duplication and to facilitate access to them. Such a procedural direction will need to be clear and precise as this useful practice is not yet widely recognized. For example, whether photocopied or on disk, inter-party correspondence (including instructions, requests for instructions and the like), the agreed records of meetings, programmes, agreed summaries of measurements, agreed summaries of valuations, drawings and other technical documents ought to be contained in separate indexed files with the pages individually numbered so that additions can be made simply. [53-55]

Witnesses

35. Subject to legal requirements and the wishes of the parties, evidence that is not contained in a document and which is necessary in order to prove or disprove a point at issue must be presented by means of a written statement from the witness, in that witness's own words (unless the witness is incapable of this), verified and signed by that witness. An accredited translation must be provided if the evidence is not in the language of the arbitration. [56]

36. It is usually sensible to allow for supplementary or additional statements of evidence to be exchanged shortly after the principal statements, in light of evidence intended to be given, so that all the evidence is in writing. [56]

37. All witness statements should be exchanged in good time before the preparation of any pre-hearing submissions. [56]

Experts

38. Where one or more members of the tribunal have been nominated or appointed for their expertise, there should normally be no need for the tribunal to duplicate that expertise by appointing its own expert, unless the assessment of part of the case might take a considerable time. Given the important implications such a decision is likely to have, it should normally be discussed with the parties. [15, 58]

39. It is always prudent to clarify whether or not expertise is required, why it is required, by whom it will provided and when. [59]

40. The tribunal should appoint its own expert only if there is a real need for one, as the costs of such an expert are borne by the parties. In many cases, however, it will be cost-effective to do so, for the opinion of that expert might render unnecessary any [Page38:] further expertise or may identify the points upon which evidence or reports from witnesses or other experts may be required. [59]

41. The tribunal ought to decide whether it will appoint its own expert before it issues the provisional timetable under Article 18(4) of the ICC Rules of Arbitration, since the timetable will be affected by the work of the expert. [59]

42. The tribunal may need to differentiate between truly independent experts and consultants retained by the parties to assist in the preparation of their claims. Such consultants may produce reports and give evidence in the arbitration, so the tribunal will need to make sure that any information they obtain from a party and use in their evidence and opinions has been communicated to the other party and to the tribunal. [60]

43. The tribunal ought either to draw up the terms of reference of the parties' experts (on the basis of the issues known to it) or require the parties to agree a statement of the issues and facts (both agreed and assumed, e.g. as set out in the witness statements) upon which expert evidence is required. If the tribunal does not take this course, it should be provided with the terms of reference or instructions the experts have received from their clients (subject to privilege), so as to check they have been given proper directions and explanations and that their opinions will be reliable. [61]

44. If the experts are independent of the parties, they should ideally discuss their views with each other before preparing their reports, as most independent experts eventually see eye to eye. This could be done at a meeting possibly chaired by the tribunal or, if the parties agree, a designated member. [61]

45. It must be made clear whether or not agreements between experts bind the parties. If the tribunal were to chair discussions between experts, it might be difficult for a party to question any such agreements. Reports must be confined to questions or issues on which there is a lack of agreement. [61]

General

46. Whenever appropriate, all applications about procedural matters which do not raise questions of substance should be made and decided by correspondence or telephone without a hearing. [46]

47. A party's submissions should be numbered or arranged so as to match those of the other party. [34, 63]

48. All submissions prior to a hearing should be in writing. [62-63]

49. All submissions should be full but concise, and should be delivered at the earliest possible opportunity. [63]

Hearing

50. The tribunal should either require the parties to decide how the time available during the hearing should be allocated (in which case the parties will be held to their [Page39:] decision), or the tribunal should itself draw up and abide by a strict timetable, unless to do so would be unjust. Each party must be treated fairly, but this does not mean that the tribunal necessarily has to accord them equal witness time, as it is required to do for statements or submissions. [64]

51. Prior to the hearing the parties should be required to agree which documents will be needed at the hearing and which (if not already conveniently available) should be put on CD-ROM or assembled in the form of files. Pre-hearing submissions, witness statements and any reports from experts should be cross-referenced to the documents. [65]

52. Either minimal time should be allowed at the hearing for oral opening statements, or no opening statements should be made at all. [63]

53. Factual witnesses should be heard before the experts' reports are considered, since the questioning of a factual witness may require an expert to modify or withdraw an opinion or provisional conclusion. [66]

54. Time available at a hearing need not be used for closing submissions, which are often best presented in writing shortly after the conclusion of the hearing. The time within which written closing submissions are to be delivered should be set by the tribunal well before the hearing (e.g. in the provisional timetable) and certainly in good time prior to its conclusion. No further submissions will be considered once the time limit has expired. [67]

55. The tribunal should make it clear that no new facts or opinions will be admitted after the hearing has taken place, unless specifically requested by it. [67] [Page40:]

Click here to view table

1
Leader of the Forum on Arbitration and New Fields.

2
The Section gratefully acknowledges all the contributions received, especially from those listed hereafter (it apologizes if by inadvertence anybody has been omitted): Max Abrahamson, James M. Arnott, the Hon. Sir Ian Barker QC (for the New Zealand National Committee), John Beechey, Albert Jan van den Berg, John Blackburn, David Brown, Peter Caldwell, Yves Derains, Derek S. Firth, Pierre M. Genton, J.-C. Goldsmith, J. J. Goudsmit, Martin Harman and a team comprising Tanya Melnyk, Julian Cohen, Steven Carey, Gordon Bell and Mark Roe, G. Beresford Hartwell, Martin Hunter, William Huyse, Gordon Jaynes, Neil Kaplan, Pierre Karrer, Helen Kenyon and her team, Tómas Kennedy Grant, Helge Jakob Kolrud, Donald L. Marston, James J. Myers, Fritz Nicklisch, Alan Redfern, Colin Reese, J. Rozemond, Samir A. Saleh, Pieter Sanders, Christopher R. Seppala, Audley Sheppard, the Swiss National Committee, Esam Al Tamimi, John B. Tieder, John Uff, Christian Wiegand.

3
It would assist participants in this process if the ICC International Court of Arbitration were able to designate a member of the Secretariat to provide information about construction arbitrations and to act as a link.

4
See page 32 below.

5
See for example the excellent commentary published in [2000] Business Law International 14.

6
These include for example engineers and other professionals where the contractor is responsible for design.

7
It is appropriate, however, to mention that, rightly or wrongly, some perceive the introduction of DABs and DRBs as a cause for an additional expense which adds to the cost of the project. See C. Seppala, 'FIDIC's New Standard Form of Contract - Force Majeure, Claims, Dispute and Other Clauses' (2000) 17 ICLR 235 at 249.

8
This would allow the third member of the tribunal to be a person less experienced in international construction arbitration, which in time would help to increase the numbers of suitably qualified arbitrators.

9
Approximately 23 million euros.

10
For excellent general guidance, see 'Terms of Reference under the 1988 ICC Arbitration Rules - A Practical Guide' (1992) 3:1 ICC ICArb. Bull. 24, and S. Lazareff & E. Schäfer, 'The 1992 Practical Guide on Terms of Reference Revisited' (1999) 10:2 ICC ICArb. Bull. 14.

11
In keeping with the terminology of the ICC Rules of Arbitration of 1998, 'respondent' is used throughout this report in preference to 'defendant'.

12
Article 18(1) of the ICC Rules of Arbitration requires the arbitral to take account of the parties' 'most recent submissions'.

13
Such as the Rules of Evidence of the International Bar Association.

14
See paragraph 46 below.

15
See page 40 below.

16
See page 41 below. Such schedules are of course of use in non-construction disputes, too, such as those about computer hardware or software where logs have been kept of faults or crashes.

17
Cf. Article 23(1), ICC Rules of Arbitration.

18
The tribunal should be aware of the time required for such tests before requiring or authorizing them.

19
An as-planned CPN is of very limited value, or no value at all, unless it is compared with an as-constructed CPN.

20
See Article 18(4), ICC Rules of Arbitration.

21
When in this report we refer to the agreement of the parties, it is of course essential that such agreement should be in writing and signed by the parties or their duly authorized representatives.

22
This problem is of course not confined to construction arbitrations.

23
A full set of contractual documents should have been produced before the Terms of Reference were signed.

24
The tribunal is not bound to draw adverse conclusions, however.

25
The same sensitivity can also arise in relation to tests, inspections, visits and other procedures for gathering evidence.

26
Including expert evidence.

27
A similar requirement would be made of a member of an arbitral tribunal to be relied upon as a lawyer. Such person would need to be competent in the legal field in question.

28
As required by the declaration which all nominated arbitrators have to file, in accordance with Article 7(2), ICC Rules of Arbitration.

29
There can be no guarantee of cost savings, however. A party may call for an expert to assess the opinion of the tribunal's expert or be simply determined to exercise its right to present its own expert evidence.

30
E.g. quantity surveyors, claims consultants, etc.

31
The parties are of course however entitled to be represented at any meeting with the tribunal if they so wish.

32
Such questioning may be conducted by a party directly or through the tribunal.

33
See paragraph 53 above.

34
Cross-references are given to the principal paragraphs of the report.

35
Approximately 23 million euros.