DBIA Dispute Resolution and Claims Management 1 — Questions and Answers
Question 1: What is the preferred first step in the DBIA dispute escalation process when a disagreement arises on a design-build project?
- Direct negotiation between the parties' senior representatives (Correct answer)
- Filing for arbitration
- Submitting to litigation in a court of law
- Requesting a Dispute Review Board hearing
Correct answer: Direct negotiation between the parties' senior representatives
DBIA standard documents require parties to first attempt direct negotiation between senior representatives before escalating to formal dispute resolution mechanisms.
Question 2: Which alternative dispute resolution (ADR) method results in a binding decision made by a neutral third party without court involvement?
- Mediation
- Partnering
- Arbitration (Correct answer)
- Conciliation
Correct answer: Arbitration
Arbitration produces a binding decision from a neutral arbitrator or panel, making it enforceable without going through the court system.
Question 3: What is a Dispute Review Board (DRB) in the context of design-build projects?
- A government agency that oversees construction disputes
- A panel of neutrals that reviews disputes and issues recommendations or decisions during project execution (Correct answer)
- An internal team within the design-build entity that handles claims
- A court-appointed mediator for construction projects
Correct answer: A panel of neutrals that reviews disputes and issues recommendations or decisions during project execution
A DRB is a standing panel of neutral experts established at project start that reviews disputes as they arise during execution, helping prevent escalation to litigation.
Question 4: In a design-build project, who typically bears the risk of design deficiencies that result in construction cost overruns?
- The owner
- The design-build entity (Correct answer)
- The subcontractors
- The project lender
Correct answer: The design-build entity
In design-build, the D-B entity assumes single-point responsibility for both design and construction, meaning design deficiencies and resulting cost overruns are the D-B entity's risk.
Question 5: What does 'partnering' refer to in the context of dispute prevention on design-build projects?
- A legal agreement requiring joint venture formation
- A structured process to build collaborative relationships and shared goals among project stakeholders (Correct answer)
- A financial arrangement where profits are shared equally
- A procurement method for selecting subcontractors
Correct answer: A structured process to build collaborative relationships and shared goals among project stakeholders
Partnering is a structured process involving workshops and agreements to foster collaboration, shared goals, and open communication, which helps prevent disputes from arising.
Question 6: Under DBIA standard contract documents, what is the typical timeframe within which a design-build entity must provide written notice of a claim for additional compensation or time?
- Immediately upon discovery
- Within 21 days of the event giving rise to the claim (Correct answer)
- Within 90 days of project completion
- Within 7 days of the event giving rise to the claim
Correct answer: Within 21 days of the event giving rise to the claim
DBIA standard documents typically require written notice of a claim within 21 days of the occurrence or discovery of the event giving rise to the claim.
Question 7: What is mediation in the context of construction dispute resolution?
- A binding process where an arbitrator issues a final decision
- A non-binding process where a neutral facilitator helps parties reach a voluntary settlement (Correct answer)
- A government-mandated review of construction disputes
- A contractual provision that waives the right to litigation
Correct answer: A non-binding process where a neutral facilitator helps parties reach a voluntary settlement
Mediation is a non-binding ADR process where a neutral mediator facilitates negotiation between parties, helping them reach a voluntary settlement without issuing a binding decision.
DBIA Dispute Resolution and Claims Management 1
What is the preferred first step in the DBIA dispute escalation process when a disagreement arises on a design-build project?