NASBP Participates in AAA National Construction Dispute Resolution Committee Annual Meeting

On behalf of NASBP, I attended the American Arbitration Association (AAA) National Construction Dispute Resolution Committee (NCDRC) Virtual Annual Meeting on November 4. The NCDRC is an advisory committee formed by AAA to discuss with a wide variety of construction and related industry, trade, and professional associations the AAA rules and dispute resolution processes generally. Some of the participating associations, in addition to NASBP, are AIA, ABA Forum on Construction Law, AGC, and American College of Construction Lawyers.

The overarching theme of the Virtual Annual Meeting was the successful and significantly increased use of virtual hearings, during the pandemic, with many AAA arbitrators and mediators using Zoom and other video-conferencing services for hearings. It was noted that video-conferencing hearings work well to allow more carriers to be directly involved in the hearings. It was repeatedly noted that a top-notch technical person must manage the exhibits and work closely with the attorneys and witnesses—or a big mess could ensue. Most of the participants believe that, even without a pandemic, video-conferencing hearings will become a new normal option.

What are some of the other takeaways from the Virtual Meeting?

• Arbitration is up 6% and mediation is down 4% this year compared to the prior three years.
• AAA construction claims are consistent with past years: $2.2 billion in claims, and $577 million in counterclaims.
• The states with the largest number of AAA filings are the following: California, Florida, New Jersey, New York, and Texas.
• Some construction cases, particularly energy and utility, are being filed under the AAA Commercial Arbitration Rules and Mediation Procedures rather than under the AAA Construction Industry Dispute Resolution Rules and Procedures. AAA noted that there needs to be more education about when the construction industry rules should be used.
• The AAA construction roster composition hasn’t changed in recent years: 80% are attorneys and 20% are industry professionals. AAA is trying to recruit more industry professionals to the construction panel.
• The NCDRC Rules Subcommittee, led by Adrian Bastianelli, of the law firm Peckar & Abramson and a former participant on NASBP’s Attorney Advisory Council, will release in early 2022 a review of the dispute resolution board (DRB) rules and procedures. A DRB is a structure of industry experts that supports real-time negotiation. The focus of DRBs is on dispute avoidance and mitigation.

NASBP will participate in the NCDRC Mid-Year Update on June 2, 2022, and in the next Annual Meeting on November 3, 2022 (which may be in person), and will provide updates about those meetings.

The author of this article is Martha Perkins, General Counsel at NASBP. She can be reached at mperkins@nasbp.org or 240.200.1270.

This article is provided to NASBP members, affiliates, and associates solely for educational and informational purposes. It is not to be considered the rendering of legal advice in specific cases or to create a lawyer-client relationship. Readers are responsible for obtaining legal advice from their own counsels, and should not act upon any information contained in this article without such advice.