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RICS Conflict Avoidance Pledge

12 February 2018. Published by Rebecca May, Associate

It is well-known that the costs of resolving disputes can quickly escalate, and that it is often not cost and/or time effective to pursue even mid-sized claims through arbitration or litigation. In an attempt to circumvent the need for this sort of dispute resolution, by avoiding disagreements escalating into disputes, the Conflict Avoidance Coalition (CAC) has formed and introduced a "Conflict Avoidance Pledge".

The CAC is made up of a number of leading construction and engineering bodies including:

  • Royal Institution of Chartered Surveyors

  • Institution of Civil Engineers

  • International Chamber of Commerce

  • Royal Institute of British Architects

  • Chartered Institute of Arbitrators

  • Dispute Resolution Board Foundation

  • Chartered Institution of Civil Engineering Surveyors

  • Transport for London and Network Rail

RICS is encouraging parties involved in the land, property and construction industries to sign up to the "Conflict Avoidance Pledge". This pledge is wholly voluntary but signifies a party's willingness to pro-actively seek to avoid conflict by identifying potential disputes early, promoting collaborative working and utilising conflict avoidance mechanisms. The CAC hopes to promote a greater understanding and use of conflict avoidance to resolve disagreements early and avoid damaging business relationships or entering into expensive and time consuming formal dispute resolution.

As at 5 February 2018, 68 companies had signed up to the Conflict Avoidance Pledge including some of the industry's biggest names such as Amey, Balfour Beatty Rail, Morgan Sindall, Mott MacDonald, Skanska, VolkerFitzpatrick and Volker Rail. It is clear that this Pledge will only work in practice if the majority of clients and their supply chains sign up to it.  Nonetheless it is promising that these leading companies have already shown their support.

Methods which can assist with early identification of issues include "RADAR", a horizon scanning service which bridges the gap between forensic data and stakeholder perceptions. Parties to a contract are able to input anonymised responses to questionnaires and air grievances. As the data is anonymised it is likely that issues that wouldn't be brought up in an open meeting would be raised and concerns that the parties have addressed early on.

Secondly RICS endorses the DRS Conflict Avoidance Panel which encourages communication and cooperation to avoid escalation. The process provides fully reasoned, independent recommendations for settlement, which whilst not binding, a party must provide a written explanation if they do not wish to follow it.

Will the Conflict Avoidance Pledge make a difference? The cynic would argue that many have tried similar approaches in the past so will this be different?  For the Pledge to be effective all parties need to be cooperative but it is likely to be in any party's best interests to resolve a disagreement amicably and without recourse to the courts. Whilst it is unlikely that the Pledge can prevent all disagreements from escalating to formal resolution, it should help to provide a framework for additional cooperation to resolve comparatively small disputes which could not effectively be resolved through arbitration or litigation.  The impact of the Pledge waits to be seen.