Dispute Review Boards: Overview

Problems, disagreements and claims arise in most large and complex construction projects regardless of the project delivery method — design-build, design-bid-build, construction manager at risk, construction manager not at risk and integrated project delivery system. These disputes can and do delay and significantly increase the cost of the project. Dispute Review Boards, also known as Dispute Resolution Board, Dispute Board, Dispute Avoidance Board or DRB are often found in large construction projects to assist the parties to minimize, resolve or avoid disputes and mitigate adverse impacts to projects. To date, over $270 billion worth of construction projects have used the dispute review board process to avoid numerous disputes and achieve significant savings.[1]

The DRB process is different than mediation and arbitration because the DRB is convened at the very beginning of the project and conducts regular meetings and visits at the project site throughout the performance of the project — allowing the DRB to discuss, observe and monitor construction, progress, and potential disputes. At these meetings, the DRB members become familiar with many of the facts and acquaint themselves with the jobsite personnel. If a dispute is submitted to them subsequently, the panelists have a great deal of knowledge about the circumstances of the problem to aid them in reaching their recommendations or conclusions. DRBs also have the effect of encouraging open and honest communications among or between the parties during the project, which in turn, encourages avoidance or resolution of disputes before the disputes become formal claims. In short, the DRP process involves real-time discussion of the dispute with highly qualified people who know the particular project from day one and can provide recommendations on how to resolve disputes.

When a dispute cannot be resolved by the parties through negotiation, either party may submit the dispute to the DRB for a formal nonbinding recommendation.[2] Project personnel for each party present their side of the dispute to the DRB – in an informal setting usually without lawyers. If the DRB’s decision is not accepted by the parties, the matter can be referred to arbitration for a binding and conclusive resolution.


Reasons to Implement a DRB:[3]

Owners implement DRBs: (i) to avoid claims, particularly massive claims at the end of jobs asserting difficulties from the early project stages, (ii) to minimize impacts on the project schedule due to unforeseen conditions or unanticipated late changes in the scope of the work, and (iii) to maintain predictability over the use of available funds.

The use of a DRB also helps to attract and increase competition because some international infrastructure contractors are hesitant to bid on a project that does not have a DRB. Public owners must ensure that the DRB is within the boundaries of best construction practices and that it would be a prudent expenditure of public dollars. The following are some DRB attributes that are attractive to owners:

  • Effect Future Behavior: Unlike mediation, arbitration, conciliation, litigation, standing neutral and early case evaluation services, DRBs offer the opportunity to impact future behavior on a project. Neither mediation nor arbitration offers the parties this benefit because these processes evaluate past behavior.
  • Elicit Cooperation: DRBs can convert into arbitration panels, either binding or nonbinding, and so, are more effective than traditional partnering programs in eliciting cooperation among the parties and resolving the disputes.
  • All Stakeholders Can Participate: Stakeholders who are not direct parties to the construction contract (i.e., subcontractors, tenants and lenders) can participate in DRB meetings, which enables consensus to be reached with all interested parties in a single forum to benefit the project.
  • Validation of Owners’ Decision: In the context of a hierarchical bureaucracy (which can impose oversight by elected officials, administrative supervisors, auditors, outside funding agencies and Boards) a DRB offers independent, neutral and competent validation of decisions by the owner’s staff to pay for extra work during the progress of the project. An owner’s representative that has considered the input of a DRB is less likely to be accused of unnecessarily folding to a contractor’s demands.
  • Projects are More Collegial: Projects with DRBs have a jobsite ambiance that is more collegial and less adversarial than traditional projects. No owner wants to have a job that the contractor hates to work on.
  • No Surprise Claims: Surprise claims are almost eliminated. Job conditions are discussed regularly, and a Contractor’s failure to raise a significant job condition at DRB meetings can lead to a waiver or abandonment of claims arising from prior impacts it failed to disclose to the owner.

How to Form a DRB

A DRB is formed by contract between the owner and the contractor. This means that there is no statute governing the formation or dispute board proceedings. The dispute board agreement should include provisions that discuss the following:

  • qualifications of DRB members;
  • ethics requirements (neutrality);
  • selection process for DRB members;
  • timing of selection of DRB members;
  • payment of DRB members;
  • timing of site visits;
  • method of referral of disputes to the DRB;
  • prehearing submissions;
  • hearing procedures;
  • DRB recommendations;
  • admissibility of DRB recommendations in future proceedings;
  • informal or advisory opinions; and
  • clarification and reconsideration.

Both the Dispute Resolution Board Foundation (www.drb.org), and ConsensusDocs (https://www.consensusdocs.org/) have sample provisions.[4] The Project Finance and Development Committee of the ABA, Business Law Section will be publishing its own sample provisions in the near future. A discussion of appropriate provisions to be agreed upon by the parties and the agreement to be executed among the DRB members and the parties is beyond the scope of this article.

Types of Dispute Boards:

Generally, there are three types of dispute boards:

  • Dispute Adjudication Boards: which issue binding decisions that must be complied within a certain time frame.
  • Dispute Review Boards: which issue recommendations that are not binding on the parties.
  • Combined/hybrid Dispute Boards: which may issue recommendations or binding decisions.

Composition of the DRB Panel

Usually, a DRB panel consists of three members, although smaller projects (costing less than $10 million) may have a single panelist. There are different ways to select a panel:

(1)       the parties meet and jointly agree on all three members of the DRB;

(2)       each party nominates a board member and the two board members then nominate a third member. All three panel members should be approved by both parties. Typically, the third member serves as chair and all three members of the DRB become neutral upon appointment; and/or

(3)       each party proposes a list of three to five members. Each party selects from the other party’s list, and the two DRB members then select the chair subject to approval by both parties.

Panelists are selected for their personal and professional qualities. They must be sufficiently experienced in the type of work required by the contract so that they bring value to the table as trusted mentors and technical resources for the project team (usually engineers, and sometimes construction lawyers). They should also possess the interest, training and temperament to facilitate a project with humor and calm professionalism. Prospective panelists should commit to be available to convene on the schedule that the project demands and should not be so busy that meetings are delayed or postponed to accommodate panelists’ schedules. Facilitative skills are valuable for the regular meetings, and in the event a formal hearing is needed, administrative management skills will be crucial for DRB members.

The DRB works well only when the parties trust the panel. It is critical that panelists maintain not only impartiality and neutrality, but the appearance of impartiality and neutrality. Ex parte communications are strictly prohibited, including written, electronic and verbal communications. Similarly, and as distinguished from a mediation process, private caucuses with a single party are prohibited.

The DRB members must be objective, impartial, neutral and without conflicts of interest. Prior to selection, prospective panelists disclose past and current relationships that could give rise to perceived conflicts of interest, or indicate a lack of neutrality with regards to members of the project team. These disclosures are similar to those made by prospective mediators or arbitrators. The disclosure must be updated on a regular basis if there is any change.


DRB Meetings

The characteristic that distinguishes DRBs from almost every other form of ADR is regular meetings and site visits that take place during the performance of the work. Depending upon what the parties decide, DRBs visit the project monthly, four times a year, or at some other agreed-upon interval.

During the meetings, the DRB and parties discuss the progress of the work since the last meeting, difficulties encountered, schedule status, and potential claims and disputes. The DRB members visit the site to observe the construction, with emphasis on the areas of potential disputes. Conversations that take place during these monthly meetings are often deemed confidential settlement negotiations to encourage an open exchange of information and ideas from all participants, so an optimal plan forward can be agreed upon. At its regular periodic meetings, a DRB may be requested to offer informal oral “advisory” opinions. All affected stakeholders should be invited to attend these monthly meetings, including major subcontractors and tenants.

The regular meetings and site visits serve several important purposes. The DRB can observe the construction issues giving rise to the dispute. As a result of obtaining information in real time, DRB can facilitate or determine the resolution of a potential dispute.

The DRB has the opportunity to meet the jobsite personnel in an informal, non-adversarial setting when there are no disputes. This knowledge of the individuals, gained during the site visits, assists the DRB in evaluating the subsequent presentations to the DRB by the parties. And with all due respect to our readers, the DRB often hears about the disputes before the attorneys have the chance to frame the claims and coach the witnesses.

The presence of the DRB often encourages settlement and resolution of disputes even before formal presentation to the DRB. The parties openly discuss potential claims with each other at each DRB meeting. The DRB facilitates non-adversarial discussions – which facilities negotiation and resolution of the issues. In addition, a knowledgeable and well-regarded DRB usually develops the respect of the parties during the site visits. If so, the parties may be reluctant to present frivolous claims and are more likely to value and adopt the recommendations of the DRB.

It is not advisable to eliminate the DRB’s regular meetings and site visits[5] because otherwise, the DRB will simply become a nonbinding arbitration panel. If the DRB operates as designed, disputes may never need a formal DRB hearing. The written recommendation of the DRB may be binding or nonbinding. The trend in the USA is for written recommendations of the DRB to be nonbinding. The contract may provide that written DRB recommendations are admissible as reports of jointly selected experts, or that the recommendations are inadmissible in subsequent arbitration or litigation proceedings. There is a preference for nonbinding, admissible recommendations.

Removal or Termination of a DRB Member

The effectiveness of a DRB depends upon its ability to persuade the parties to accept its recommendations. If a party does not trust a DRB member, that party is unlikely to be persuaded by the DRB or that member. However, one party’s dissatisfaction with a DRB would allow that party to change the composition of the DRB just because that party was unhappy with the findings and recommendations of a DRB member or any other reason – leading to abuse of the process.

In addition, the new DRB member would not have the benefit of prior site visits, thereby defeating one of the main advantages of the DRB. The dismissal of a member without a substituted appointment, however, could cause serious prejudice.

The DRB Foundation recommends that a party may not terminate a panel member without the consent of the other party or parties. If one party objects to a member and the DRB concludes that the member is a detriment to the DRB process, that member should resign. If the DRB, however, determines that the DRB member is impartial and one party still objects to the member, then the DRB has lost much of its effectiveness and, the entire DRB should offer its resignation — even though this solution is less than adequate.

DRB Hearings

Either party may refer a dispute to the DRB at any time. The parties then submit short, concise position papers and relevant documents. No discovery is permitted, although the DRB members have the right to request information they believe is necessary for resolution of the dispute.

The hearings are dramatically different than hearings in arbitration and litigation. They are informal and nonadversarial — much more like a mediation presentation than an arbitration hearing. The presentations are made by the persons involved in the actual construction. The witnesses are not sworn. Openness, candor and full disclosure are encouraged. Typically, lawyers are not allowed to make presentations, except to address legal issues. While cross-examination is not permitted, the parties may suggest questions to be asked, and the DRB members are allowed to ask questions. Even without cross-examination, the DRB can evaluate credibility because they know the witnesses and the facts from the meetings and site visits.

Findings and Recommendations

            Written Findings / Recommendations

Unlike an arbitration panel or court, the DRB does not issue a decision, verdict or award. Instead, it provides written findings and recommendations that include an analysis to support its conclusions. The findings and recommendations are not binding.

The DRB must persuade the parties that its conclusions should be accepted. The parties typically use the findings and recommendations as a basis to negotiate a final resolution of the dispute. However, some contracts provide that the findings and recommendations become final if not rejected in a timely manner.

DRB findings and recommendations are generally admissible in a subsequent court or arbitration proceeding. The admissibility of DRB’s findings and recommendations in a later proceeding provides a major impetus for the parties to accept them, despite being nonbinding. However, admissible findings and recommendations may cause the parties to treat the DRB hearing more like an arbitration or litigation and seek discovery and other legal protections.

In addition, the admission of the DRB findings and recommendations may have an undue influence on a court or jury, who are likely to accept the DRB’s findings and recommendations because they come from experts in the industry selected by the parties before the dispute, even though the findings and recommendations are based on unsworn testimony and hearsay that is not subject to cross-examination or other procedural safeguards. Keep in mind that DRB findings and recommendations should be based on law and should enforce the contract provisions.

Oral Recommendations

We recommend including an informal or advisory DRB process in the DRB specifications. In this process, the parties typically provide the DRB with concise position papers and documents shortly before a regularly scheduled DRB meeting. Abbreviated oral presentations are made at the meeting. Quantum is usually not addressed unless that is a sticking point.

The DRB deliberates after the presentations and provides an immediate verbal advisory recommendation. The advisory recommendation does not preclude the parties from subsequently pursuing the dispute through the formal DRB process. This informal advisory process provides the parties with a far faster and less expensive method to resolve their disputes, particularly small disputes, and have it occur in real time.

Cost of the Dispute Review Board

The cost of the DRB depends on the frequency of the meetings and the length of the project. While the compensation of a DRB varies from project to project, fees in the neighborhood of $2,000 – $4,000 per day, per member are not uncommon. A DRB holding no formal hearings may cost approximately $40,000 to $75,000 per year. On smaller projects, half-day meetings may be sufficient, at a lower cost.

Each panelist is individually engaged by contract at an hourly or daily rate. Sometimes the cost of regular meetings is shared between the owner and contractor, but often the owner pays all costs of regular meetings, and splits only the costs of dispute hearings, should any be needed. Another option is to include an allowance in the contract for the DRB costs. The engagement should provide that panelists may not be called to testify in any subsequent arbitration or litigation proceeding.

Virtual Meetings

Prior to 2020 and the advent of COVID, it was rare for Dispute Review Boards to meet remotely. Now, the players in a construction project are more willing to accept virtual meetings in order to resolve issues and keep the work moving along on schedule. The basic principles for effective DB proceedings remain in place, despite the logistics. Please refer to the DRBF’s Dispute Board Manual: A Guide to Best Practices and Procedures, for guidance.

The following issues should be considered for virtual DB meetings:[6]


  • Who will participate? Seek to ensure the continued engagement of senior executives as well as project personnel.
  • Does the system have capacity limits which require restricting the number of people?
  • Who will host? The DB Chair may do so to ensure maximum control of the meeting, but if a party hosts then the Chair should set some ground rules in order to retain control of the meeting.
  • Prepare a very detailed agenda, including anticipated time allocations. Plan to have breaks at regular intervals, although this may not be set at a particular time in order to preserve the flow of discussions.
  • What reports and documents will be provided in advance and by whom?
  • Ask the parties to provide a brief joint summary in advance.
  • What reports, presentations and/or documents will be provided during the meeting and by whom?
  • DB members should consider having two or more screens, one to see the parties and one or more to view documents.
  • Depending on the platform, consider selecting “Gallery View,” where all participants can all be seen, rather than “Speaker View,” where the person speaking is shown in a larger screen.
  • Some platforms have a capacity for participants to dial in (and not be seen by video and not be identified by name). It is important that the identity of all participants, including those phoning in, be established at the outset of the proceedings.
  • The Chair should identify the participants at the beginning and at the end of each session.
  • Participants should update all software to the latest version.
  • Make sure the best possible internet connection is being used; this may include turning off other devices on the same system to maximize bandwidth. If connection weakens during the meeting, try turning off video to preserve best possible audio.
  • Devices should be fully charged and connected to power.
  • Turn off all notifications on primary and secondary devices to avoid distractions.
  • Shut doors and windows to avoid background sounds and/or visual distractions.
  • Notify others of meeting status to minimize interruptions.
  • Test camera angles, background and lighting. Each attendee’s face should fill 50% of the screen. Some systems allow a virtual background to neutralize the location, or participants may want to adjust location to have a simple plain wall behind them. Lighting should be from the front and not from behind.
  • Test sound (perhaps with others beforehand). Do you need to wear headphones and use a microphone?
  • Position your notes so they cannot be seen by the camera.
  • Wear what you would normally wear to a meeting.
  • Make eye contact with the camera when speaking.
  • Be mindful of the mute button. Use it when you are not speaking and when you are on any scheduled breaks. Remember to “unmute” when it is your time to talk. The DB should remind the participants of this at the outset of any meeting or hearing.
  • Remember each participant is “on show” throughout the proceedings, so it will be obvious if they are distracted by something else.
  • If using screen share or other functions of the online platform, make sure users are properly trained on the technique; view how-to videos online and have a practice session with the administrator.
  • Allow for sufficient pauses when addressing remarks and asking questions. There can be short delays in the technical system, or a pause as someone considers their response.
  • If you will be sharing your screen, be careful to close all other documents or programs so as to not accidentally share confidential or personal information with others.


Enforceability of Dispute Board Decision

As discussed above, a Dispute Board may issue either recommendations or binding decisions, which may be revised in arbitration or litigation. In either case, depending upon the rule that the parties have adopted, arbitration is normally pursued if the matter is international. When the losing party fails to comply with an international arbitral award, the prevailing party may need to seek enforcement under the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards – more commonly known as the New York Convention – which has been adopted (currently) by 165 of the 193 United Nations member states. The lack of enforceability is a weak link in the Dispute Review Board process, which makes the recommendation or decision of a review board less valuable for the prevailing party than an arbitration award or court decision. Nevertheless, the benefits and the likelihood of success of Dispute Review Boards domestically and internationally weigh strongly in favor of using them as an initial form of dispute avoidance and resolution.

[1]          See the Dispute Review Board Foundation at DRB.


[2]          The parties can decide in advance to make the DRB’s recommendation binding under certain circumstances.


[3]          The Dispute Resolution Board Foundation (www.drb.org) publishes a Dispute Board Manual and a DRBF Document and Learning Library on-line.  The World Bank, which introduced the requirement for DRBs in 1995, continues to endorse the use of DRBs in the execution of the projects it finances.  The American Arbitration Association published its Dispute Resolution Board Guide Specifications on 1 December 2000, which can be incorporated into any contract.

[4]           The DRBF Practices and Procedures contains a set of guide specifications for use in contracts.  The ICC, FIDIC, the World Bank, AAA, and CIArb have also developed their own set of standard dispute board rules.


[5]           In the COVID and post-COVID world, parties may consider virtual site visits – depending upon the issue, the nature of the Project, the size of the dispute, and the cost of convening all parties for a site visit.

[6]          “Best Practice Guidelines for Virtual Dispute Board Proceedings,” 5 August 2020, Dispute Review Board Foundation,