Arbitration as an alternative dispute resolution method in the construction industry of Sri Lanka

Abstract

The construction industry in Sri Lanka covers a complex and comprehensive field of activities. Disputes might arise at any point during the construction process. Dispute resolution systems are changed with the interaction of the parties. Arbitration is a voluntary procedure available as an alternative resolution to litigation, however not enforceable as the means of settling disputes except where the parties have entered into an arbitration agreement. Construction claims tend to be of the most technical nature - intensive and multifaceted than most other commercial disputes. The desirable features of arbitration are fast, inexpensive, fair, simple, flexibility, confidentiality, minimum delay. Sri Lanka Arbitration Act No. 11 of 1995 stated arbitration principles and UNCITRAL Model Law. However, there is a necessity to reviewing and improving of the arbitration practice periodically in order to minimise the cost and complexity of the procedure. This research is ultimately aims to assess significant attributes of arbitration in construction industry of Sri Lanka. This paper reports on findings gained from the literature review and preliminary survey conducted to explore the current status of arbitration as an alternative dispute resolution method in Sri Lankan construction industry. Current findings indicate that the construction professionals have minimum level of satisfaction on the current arbitration practice; however, they believe that arbitration is an effective mechanism for dispute resolution. The results of this study enabled to gain an understanding on the current arbitration practice and its significance and offer suggestions to improve current arbitration practices in the Sri Lankan construction industry.