Industry Priorities

Dispute Resolution and Mitigation

Construction disputes are costly and disruptive, but many can be avoided or resolved early. This page collects AGC resources on mitigating and resolving disputes, along with an overview of how ConsensusDocs contracts address alternative dispute resolution (ADR).

Alternative Dispute Resolution and Mitigation in ConsensusDocs

ConsensusDocs contracts use a stepped approach to disputes, escalating to more formal procedures only when earlier steps fail.

Dispute Mitigation. ConsensusDocs uses an innovative tiered approach that requires the parties to meet at the project level within five days of a dispute arising and, if the dispute is not resolved, at the senior executive level. This approach has been effective at eliminating or mitigating disputes before they escalate into formal claims.

Mediation. ConsensusDocs requires mediation before a claim can be elevated. Parties may choose AAA, JAMS, or another set of rules and service provider of their choice.

Project Neutral. ConsensusDocs offers the option of an objective project neutral who is kept generally informed of project facts. Importantly, this role does not default to the project’s architect or engineer, who is paid by the owner, as with the American Institute of Architects’ (AIA) Initial Decision Maker (IDM).

Dispute Review Boards (DRBs). ConsensusDocs is [the only] publisher of standard construction contracts to offer standard DRB documents. The ConsensusDocs 200.4 establishes that a DRB will be used on the project, and the ConsensusDocs 200.5 governs how the DRB operates with the parties.

Arbitration. Parties may choose AAA, JAMS, or another set of rules and service provider of their choice. If AAA is selected, its Fast Track procedures are favored. The substantially prevailing party recovers attorneys’ fees and court costs.

Litigation. If arbitration is not selected as the binding dispute resolution method, litigation is the default. The substantially prevailing party recovers attorneys’ fees and court costs.

Papers from AGC’s Risk Management Conference

AGC’s annual Surety Bonding and Construction Risk Management Conference regularly features presentations and papers on best practices for mitigating and resolving construction disputes, including tiered negotiations, mediation, arbitration, DRBs, other ADR procedures, and litigation.