Conclusion

The construction sector has a reputation for being tense and fractious, given the tight financial margins that many parties operate under, coupled with the many events that cannot be anticipated. The COVID-19 crisis is one such example, and it has further highlighted the need to prepare for and constantly address risk, to deal with tensions and disputes promptly, and to select the most appropriate processes for this to happen.

The pandemic, though, has also shown the industry’s willingness to be pragmatic and considerate to the exceptional pressures that project counterparties and other stakeholders have faced. 

With society in general developing a greater alertness and compassion towards those especially affected by the COVID-19 outbreak, these sentiments are also evident in the construction industry. A spirit of commercialism and pragmatism has filtered into the sector, although this does not mean that construction players are simply willing to stand back and not assert their rights under existing contractual arrangements. Time will also tell whether this pragmatism is here to last or whether the issues that the parties are dealing with commercially now will be the arbitrations of the future. 

Nearly all those surveyed and interviewed said the industry could still do more to manage risks, notably by keeping better records, by managing change more effectively and by submitting notices within prescribed time limits, among other factors. 

At the same time, the mechanisms for resolving disputes are constantly evolving. Our report shows that mediation and other forms of ADR have a real place in the market, and that arbitration is still gaining popularity thanks to efforts to expedite arbitral proceedings and make them less expensive. Like the rest of the economy where COVID-19 has supercharged certain industries and transformed working practices, it has accelerated change within the construction industry. The sector is certainly suffering from the pandemic, but it is responding positively.