Dispute Resolution Provisions As discussed above, alliancing contracts do sometimes restrict the extent to which parties can engage the classic dispute resolution processes should problems arise. Unlike the FAC-1, which contains relatively standard dispute escalation provisions,25 the NEC4 Alliancing Contract limits both what can constitute a “dispute” and also what methods of dispute resolution can be used to resolve them. Clause 94 provides as follows: “The members of the Alliance Agree that any failure by a member of the Alliance to comply with their obligations stated in these conditions of contract does not give rise to any enforceable right of obligation at law except for an event which is a Client’s or Partners’ liability. Any disputes between the members of the Alliance arising out of or in connection with the contract are only resolved in accordance with these conditions of contract.” [Emphasis added] There are broadly speaking four categories of Client Liabilities. These are: 1. An intention act or omission to not comply with an obligation (e.g. wilful default); 2. A liability which the Client takes on from takeover (and the guidance notes make a point of emphasising that any liabilities for the Alliance are likely to be very small post-takeover and almost disappear after the Defects Certificate is issued);26 3. Loss or damage to property owned and occupied by the Client; 4. Any other categories listed in the Contract Data. The Partners’ liabilities are similarly limited and include (broadly speaking) wilful default, a breach of intellectual rights, death or bodily injury caused to an employee and any other liabilities stated in the Contract Data.27 As such, very real limitations are placed on what Alliance members can raise claims for. In terms of Dispute Resolution options provided for, the main options are referring a dispute to an independent expert for “an opinion” (not a decision) and referring the dispute to Senior Representatives of each member of the Alliance. They in turn can decide to mediate. Adjudication is an additional option although there is a query as to how useful this would be to run given the limitations on what is a “dispute” in the first place. There is no provision for the resolution of disputes by court or arbitration. It goes without saying that parties entering into the NEC4 Alliancing Contract need to be aware that their rights to seek redress if disputes arise are severely curtailed. They either need to take this on board or amend the dispute resolution provisions accordingly to amend the risk profile being taken on. Their insurance position also needs to be carefully considered. Additional Options As well as these core provisions, the Contract also gives options for early alliance involvement (a two- stage process) and Project Bank Accounts amongst others. Conclusion The NEC4 Alliance Contract is a useful addition to standard form alliance contracts and benefits from the fact that NEC users will be familiar with its terminology. It also provides for a range of tools to ensure that collaboration can be integrated into the team from the offset. That said, as is ever the case with contracts aimed at integrating teams and fostering collaboration, it is essential that entrenched attitudes of “them and us” are tackled early on and the integrated team is educated as to how to use these tools effectively. This may take time and will undoubtedly require additional costs and investment to set up these processes at the beginning of the contract, which is why its use is likely to be confined to higher value and longer-term contracts. Further, parties do need to take note of the dispute resolution provisions and the limitations placed on the ability to dispute certain types of claims. Whilst the reasoning behind these limitations is clear there is always a risk that these provisions are overlooked until such claims arise.