How to Ensure a DAB is Formed Correctly

A blog subscriber recently asked for some advice on the setting up and organisation of a Dispute Adjudication Board (DAB). They specifically wanted to know what to do if one of the parties is trying to frustrate the procedure by refusing to agree to the appointment of the DAB. The following advice is relates to the FIDIC contracts. However, it may be equally applied to other forms of contract that have dispute board provisions.

Contractual Provisions for DABs

A proactive action would be to include a list of several potential DAB members in the Contract. A prequalified list specific to the type of project, should make the agreement straightforward. It should include preferred qualifications and experience of the board members.

The Contract should state the time frame for the appointment of the DAB. FIDIC provides that the date should be stated in the Appendix to Tender. Contractors would be well advised to check that the date is reasonable.

If no list of potential DAB members exists in the Contract, FIDIC offers the following directions:

each Party shall nominate one member for the approval of the other Party. The Parties shall consult both these members and shall agree upon the third member, who shall be appointed to act as chairman.

I would suggest that the parties each nominate more than one member. This would avoid issues in cases where the other party has an objection, or the nominated member has a conflict of interest or is unavailable. When selecting potential members, it is very important to ensure that the person is properly experienced and qualified. This matters both in terms of discipline, type of project and in adjudication. Also, think about the type of expertise required from the DAB as a whole. A good mix is to have three members from engineering, quantum, contractual and legal backgrounds. In this way, they can all add value. Otherwise, there might be a gap in knowledge if the board consists of three people of the same discipline. When reviewing nominated members, selection should be undertaken in a spirit of agreement and cooperation between the parties. The intention should be to appoint the best board possible.


Impartiality is vital. FIDIC’s General Conditions of Dispute Adjudication Agreement contains the following obligation:

‘The Member warrants and agrees that he/she is and shall be impartial and independent … The Member shall promptly disclose … any fact or circumstance which may appear inconsistent with his/her warranty and agreement of impartiality and independence.’

The Parties would be well advised to ask the question when making an initial approach. This way, you can identify any protentional conflicts of interest in the early stages of the process.

What happens when the process is frustrated?

To return to the question posed by the blog reader: What happens when one of the parties is trying to wriggle out of the formation of the DAB?

FIDIC deals with this under Sub-Clause 20.3 (Failure to Agree Dispute Adjudication Board). This allows either party to request the ‘appointing entity or official named in the Appendix to Tender’ to make the appointment. It also states that ‘This appointment shall be final and conclusive’. For this to work however, there must actually be an appointing entity or official named in the Appendix to Tender. If not, it is going to be a challenge to reach resolution.

It seems from the questions asked, that our reader is a contractor with a dispute and is facing an employer who is reluctant to appoint the DAB. This may be because the Employer realises that a decision given by the DAB will go against him. The reader also advised that there was no list of DAB members, or an appointing entity included in the Contract.

What can be done?

This type of thing is not untypical. My advice to contractors is this: Before signing, always carefully check the whole contract for errors, omissions and conflicts. If any exist, approach the Employer and request that they be corrected. Once the contract is signed, you will be stuck with it for better or worse, and it’s usually worse.

Understanding your contract key. Our Practical Use of FIDIC E-Course takes you from choosing the correct form, to contract administration through to dealing with disputes.