One of the more interesting roles Jeremy Glover has been involved in over the past few months was to help organise the first Conflict Avoidance Coalition Conference which took place on Wednesday, 2 October 2024 at Portcullis House, at the Houses of Parliament. Around 150 professionals from across the construction industry, contractors, subcontractors, suppliers, representatives from the Cabinet Office, Environment Agency, TfL, and the Houses of Parliament Restoration & Renewal, gathered together with consultants and representatives from a number of professional organisations, including the RICS, CIArb, ICE and DRBF. Jeremy explains more.
I was at the first Conflict Avoidance Coalition Conference (the “Conference”) as a result of my role with the Dispute Resolution Board Foundation (“DRBF”).[1] The DRBF was one of the founding members of the Conflict Avoidance Coalition Steering Group (“CACSG”) back in January 2018. This is, perhaps, unsurprising given the important role Dispute Boards can play in dispute avoidance. Indeed, the UK Construction Playbook states that:
“dispute avoidance boards are a potential way to avoid and manage disputes more effectively and, where appropriate, should be engaged with projects from inception to completion.”
Dispute Boards can promote dispute avoidance on projects in a number of ways. Clause 21.3 of the 2017 Second Edition of the FIDIC Rainbow Suite empowers the parties to make a joint request to the re-named Dispute Avoidance & Adjudication Board (“DAAB”): “to provide assistance and/or informally discuss and attempt to resolve any issue or disagreement that may have arisen between them during the performance of the Contract”.
This informal assistance can take place during any meeting, site visit or otherwise. But the role of the Dispute Board should never simply be confined to this, valuable though it is. Dispute Boards can collaborate with the parties and assist in the early identification, control and management of potential disagreements before they develop into a formal dispute.
And it is this role which is closer to conflict avoidance, which, of course, is why the DRBF were one of the original CACSG members. But the idea of conflict avoidance goes further still. The Conflict Avoidance Toolkit[2] very helpfully outlines the differences between dispute avoidance and early intervention:
- “ Dispute Avoidance is about stopping the smoking embers of a dispute by bringing them to the attention of people who can do something about them.
- Early Intervention is about snuffing out the smoking embers before they ignite into a fire.”
It is interesting that, increasingly, the standard forms are providing some assistance to encourage Parties to do this. Pro-active risk management is encouraged by NEC4 15.1 which provides that:
“The Contractor and the Project Manager give an early warning by notifying the other as soon as either becomes aware of any matter which could: Increase the Price, delay Completion, delay meeting a Key Date, impair the performance of the works in use.”
The NEC4 form also has an optional clause highlighting climate change, X29.3 which states that:
“The Contractor and the Project Manager give an early warning by notifying the other as soon as either becomes aware of any matter which could adversely affect the achievement of the Climate Change Requirements.”
Arguably, this is covered by the original early warning provisions, but the importance of sustainable issues rightly merits a separate distinct clause.
FIDIC has adopted a similar provision, and sub-clause 9.1 of the new JCT Design and Build Contract, 2024 edition (“JCT DB 2024”), whilst not going so far as NEC and FIDIC, now states that its aim is the: “avoidance or early resolution of disputes”. It requires the prompt notification of any matter: “that appears likely to give rise to a dispute or difference” and provides for a tiered form of dispute resolution; for example, the use of Senior Executives who are required to hold meetings “as soon as practicable for direct, good faith negotiations to resolve the matter”.
Tiered resolution can be very effective, but it can only come into play once a dispute has arisen. That is only the final part of the conflict avoidance process. Conflict avoidance is all about putting mechanisms into place to avoid the conflict in the first place.
This is why the Conflict Avoidance Toolkit sets out the five stages of the conflict avoidance process. Adopting conflict avoidance requires a commitment to:
- work proactively to avoid conflict and to facilitate early resolution of potential disputes;
- work collaboratively and use early intervention techniques to resolve differences of opinion before they escalate;
- embed conflict avoidance mechanisms into contracts;
- develop capability in the early identification of potential disputes and in the use of conflict avoidance measures; and
- promote the value of collaborative working with partners to identify, promote and apply conflict avoidance mechanisms.
So, what does working collaboratively actually mean? The JCT DB 2024 embraces ideas about collaborative working. Article 3 states:
“The Parties shall work with each other and with the other project team members in a co-operative and collaborative manner, in good faith and in a spirit of trust and respect. To that end, each shall support collaborative behaviour and address behaviour which is not collaborative.”
So, this is helpful but, again, no definition is given. A good example can be found in the work of the UK BIM Alliance, who talk about Information Management in light of International Standard, BS EN ISO 19650:
“The success of construction projects boils down to the parties involved and how well they work together to meet both their own objectives and those of the project. Working together not only involves the regular exchange of information but also understanding what happens to the information once it is passed on; this is fundamental in ensuring it is created to meet a purpose … Collaborative working requires us to communicate and be transparent with each other, to plan what we are doing as a team. Effective planning also allows information to be re-used for multiple purposes resulting information cascaded up, down and across project teams.”
When parties are collaborating, exchanging information and communicating, they are more likely to be working together and will be better placed to work to identify potential issues before they become disputes. Again, this is a key part of what conflict avoidance is all about.
Our distinguished keynote speaker at the Conference, Sir John Armitt, like many of the other speakers, stressed that collaboration is all about communication, people and relationships. Sir John also reminded us all that it is the early stage of any project which sets the tone and is determinative of how that project proceeds.
Some have questioned the involvement of lawyers in CACSG. I am not so sure why. At Fenwick Elliott (and this is true of many other construction lawyers), I think it is fair to say that we would always try to look for the best way to avoid and resolve disputes satisfactorily without the need to begin formal proceedings. That is our client’s aim, and should always be ours. Of course, if a dispute does arise, we will aim to run it efficiently and decisively while still looking, if possible, to avoid full formal proceedings.
This is all in line with the Conflict Avoidance Toolkit. When advising on the initial phases of projects, if you look to include conflict avoidance mechanisms into contracts, then you can help facilitate the early resolution of potential disputes and also collaborative working. Remember, it is the early stage of the project which can set the tone.
Spreading the word about the work of the CACSG and encouraging the implementation of the Conflict Avoidance Pledge is, I think, a part of the process of advising a client about the best ways to try and avoid disputes. Good project management is, of course, one of the best of those tools, but that needs to be supported by the provisions of your contract.
Finally, there is the Conflict Avoidance Pledge (“CAP”)[3] which now has serious momentum. Think about the wide range of attendees at the Conference – people from every part of the construction industry. This year, some 400 organisations have signed the pledge. Part of the pledge reads:
- “We believe in collaborative working and the use of early intervention techniques throughout the supply chain, to try to resolve differences of opinion before they escalate into disputes.
- We recognise the importance of embedding conflict avoidance mechanisms into projects with the aim of identifying, controlling, and managing potential conflict, whilst preventing the need for formal, adversarial dispute resolution procedures. We commit our resources to embedding these into our projects.”
I suspect most people would agree with these sentiments. And, of course, what matters is not signing the pledge but actually working to implement it. That means not just expressing support for collaborative working and the use of early intervention techniques to resolve differences, but embracing that commitment to identify, control and manage potential problems. The advantage being that, by doing so, you increase your chances of avoiding disputes in the first place.
So, what might be done to encourage the use of CAP? Well, going back to the Construction Playbook. It states that:
“The conflict avoidance pledge (CAP) … demonstrates commitment to conflict avoidance and the use of amicable resolution procedures to deal with emerging disputes at an early stage. Contracting authorities should adopt the appropriate provisions as a standard clause in all public works contracts, and use this mechanism to resolve problems before these escalate into disputes.”
Note the mandatory use of “should”. We should, therefore, start seeing government-backed parties looking to adopt CAP in their contracts. That is a good step, but what is equally important is that this approach feeds down to all (sub) contracts. Sir John Armitt’s final message was an important one for anyone He encouraged us: “to move forward not with hope but real ambition.”
It will be interesting to see what happens in 2025.
[1] Jeremy currently serves as President of the DRBF Executive Board of Directors, a position he will hold through May 2025.
[2] https://www.rics.org/content/dam/ricsglobal/documents/dispute-resolution-service/conflict_avoidance_toolkit.pdf
[3] www.rics.org/dispute-resolution-service/conflict-avoidance/conflict-avoidance-pledge
