American Arbitration Association Revises Construction Industry Rules and Mediation Procedures

Any project is bound to encounter some kinks that need to be ironed out. This may come in many forms for the construction industry, such as malfunctioning equipment or errors in cost estimates. Sometimes, though, the issue arises from disputes between people involved in construction projects, and the problem may escalate to a point where cases are about to be filed. In this scenario, a proper arbitration procedure must take place.
In the U.S., the American Arbitration Association (AAA) provides services for persons or companies in need of dispute resolution. This non-profit organization conducts administrative proceedings such as assigning arbitrators and arranging for a hearing. The group caters to just about any kind of industry, as long as there’s a need for arbitration or mediation.

The AAA follows a set of rules and procedures for arbitration and mediation in the construction industry, and its continual update of its own rules have led to the recent release of a revised set of regulations. According to its official statement, the revision aims to provide a “more streamlined, cost-effective and tightly managed process” of arbitration. The revised set of rules – which now includes a wider scope of authority for arbitrators through Rule R-25 and Rule R-60 – is aligned with the current practices in the construction field.

Here is a shortlist of the major revisions in the American Arbitration rules of procedures, some of which are described in this news article:

  • The arbitrator can issue an order to proceed with any arbitration case and a proper exchange of information between the parties involved.
  • The scope of authority of an arbitrator now includes “issuing confidentiality orders for the production of documents, imposing search parameters for electronic discovery, allocating costs for the production of documents,” among other roles.
  • Deadlines are now set for consolidation of related arbitrations or joinder of parties involved in a particular arbitration.
  • Claims of at least $100,000 are required to undergo mediation, with some exceptions.
  • Arbitrators for the construction industry may now consider “motions that dispose of all or part of a claim, or narrow the issues in a case.”

For more information about the revised arbitration and mediation rules for the construction industry, visit the AAA Construction Rules Information Page.