Suitability of alternative dispute resolution methods based on risk factors to the Sri Lankan construction industry

Abstract

Disputes in construction projects always used to resolve in litigation, where nowadays parties use new innovative dispute resolution methods known as Alternative Dispute Resolution(ADR)s. Many ADR-related studies in the local context are relevant to its applicability, enforceability, and effectiveness, whereas less studies exist on the choice of ADR method(s). Further, the literature proves risk in construction projects can be used as a criterion to select ADR methods, where studies are very less. Followingly, this study focused on developing a matrix based on risk factors in the construction industry for the choice of ADR method(s) under mixed research approach. The literature survey explored ADR method(s) and risk factors. Expert interviews were executed with five experts to filter the risk factors under the choice of ADR method(s) where 10 out of 15 risk factors were chosen as applicable for the study. Then, a structured questionnaire was designed with expert interview findings and distributed among 40 experts, where 34 responses were received. The responses were analyzed through Relative Importance Index technique. Thus, ADR methods were ranked against risk factors based on RII values and developed the matrix. The result proves negotiation is the best ADR method where conciliation, mediation, dispute adjudication and arbitration are suitable respectively.