Opportunities and challenges in construction arbitration

Opportunities and challenges in construction arbitration
On 11 December 2014, the School of International Arbitration at Queen Mary University of London will host a conference on construction arbitration with a keynote speech delivered by Sir Vivian Ramsey. In this article, we discuss what to expect from the conference with QMUL’s Professor Stavros Brekoulakis, Professor Doug Jones of Clayton Utz and Mick Smith of litigation funder Calunius Capital LLP.

For more information on the conference and to reserve your place, click here.

What can attendees expect from the conference? How does it tie up with QMUL's postgraduate programmes?

Professor Brekoulakis: for many years now the School of International Arbitration at Queen Mary University of London has conducted a LLM and Diploma course on International Construction Contracts and Arbitration. The course was originally founded and until recently taught by HH Humphrey Lloyd QC, Honorary Professor at Queen Mary, and now it is taught by Professor Stavros Brekoulakis and Mr David Brynmor Thomas (Visiting Professor at QMUL) with Professor Doug Jones (Visiting Professor at QMUL) also taking some classes.

Although the course is mainly a dispute resolution course, it also devotes a number of seminars on substantive provisions of standard forms of construction contracts (mainly the FIDIC Suite). For students to be able to understand how construction disputes can be resolved, they first need to have a good understanding of what a typical construction contract provides.

Thus, the aim of the conference is two-fold:

  • first, to celebrate the long tradition of the school in the teaching of international construction contracts and arbitration
  • secondly, to look into a number of complex issues that arise in the practice of construction arbitration, including issues of experts in construction arbitration disputes, production of documents, third-party funding in construction disputes as well as what is the economic impact of dispute resolution arrangements in construction projects

The line-up of the conference is impressive and includes a mixture of extremely experienced construction arbitration lawyers who will give the perspective of the counsel (Phillip Capper, Peter Rees, Wendy Miles, David Brynmor Thomas, Elliott Geisinger, Melanie Willems, Marie Berard), the tribunal (John Marrin QC, Dr Michael Schneider, Adrian Hughes, Doug Jones, Stavros Brekoulakis), the prospective funder (Susan Dunn, Mick Smith) and more importantly the client (Franco Mastrandrea from Hill International, Howard Shipley who was the Construction Director for the London Olympics and Ian Radford from International Bechter).

We are also honoured that Hon Mr Justice Ramsey will give the keynote speech and provide unique insight from his experience as a judge in the Technology and Construction Court.

What’s the most important lesson you’ve learned when dealing with experts in the construction sector?

Professor Doug Jones: experts fall into two categories.

The first (category 1) are those who have a technical expertise such as chemistry or metallurgy. These are 'real' experts many of whom are giving evidence for the first time.

The second (category 2) are those who deal with delay, disruption and quantum. In this second area they are expressing opinions, but on the basis of their analysis of masses of facts and documents. Usually they are professional expert witnesses.

The challenges are different between the categories. For category 1, it is important to have the experts understand their role. Category 2 experts understand their role but are often engaged to present a particular party line. Thus, their independence and duty to the tribunal needs to be emphasised.

For both categories, the party appointed experts should be encouraged to answer the same questions, work from the same data bases of documents, and in the first instance to report on what they agree upon. Individual reports should then focus on the differences of opinion only.

What distinguishes the disclosure exercise in construction arbitration? What are your top practical tips?

Professor Doug Jones: the volume of the documents and thus the huge cost.

It is important to have a heightened sense of relevance in those relied upon by parties, and in dealing with document production requests in international arbitration careful regard should be had to the relevance and potential probative value of documents sought to be disclosed.

For some lawyers, third party funding (TPF) has a largely controversial reputation: how has it been embraced within the world of construction arbitration?

Mick Smith: I would strongly dispute the suggestion that TPF is 'largely controversial'.  Far from it. It has been widely accepted and often endorsed, by lawyers, arbitrators and judges alike. There are occasional obiter remarks from outliers which attract undue press coverage.

The most prevalent view among legal community is that TPF works for a certain set of cases, though not all, and the main challenge is to ensure that it does not disrupt the application of due process when it is used.

It is for this reason that working groups now exist, such as the English Association of Litigation Funders that works with the Civil Justice Council, and the ICCA-Queen Mary International Arbitration TPF Task Force. These groups, and others, are working to ensure consistent principles of good practice are applied to TPF cases by funders, lawyers and litigants.

The usage of TPF in Construction Arbitration is a function of the number and quality of such cases that are presented by lawyers to funders. To date, at least in my experience, that supply of construction cases has been limited but we would expect it to increase as understanding of TPF continues to develop.

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About the author:

Barry specialises in international arbitration and commercial litigation. He trained and practised at Jones Day before joining Pinsent Masons. At LexisNexis, Barry is Head of Arbitration and Head of the Lexis®PSL Dispute Resolution Group.

In practice, Barry’s work included commercial, aviation and technology arbitrations pursuant to international arbitral rules, involving UK and international clients. He also has a background in general commercial, civil fraud and IT litigation, including experience before the High Court. While in private practice, Barry worked with a broad range of clients from the private and public sectors.

At LexisNexis, when not focused on the strategic development and operational requirements of the Dispute Resolution Group, Barry’s content work focuses on the law and practice of international commercial arbitration and investment treaty arbitration. In addition to his work for Lexis®PSL, Barry contributes to the LexisNexis Dispute Resolution Blog and New Law Journal on litigation and arbitration matters