Management and resolution of construction-related disputes in the UAE
According to UAE law, parties can choose to resolve disputes through arbitration, thereby “outsourcing” the courts. Arbitration in the United Arab Emirates is governed by the Civil Procedure Law, which stipulates, for example, the appointment of arbitral tribunals and the validity of arbitral awards. For a long time, people have been considering that the new federal arbitration law will update the UAE’s civil procedure law and provide a more detailed arbitration framework. However, so far, only drafts have been released. Arbitration is usually the preferred dispute resolution mechanism because the inherent risks of litigation in the UAE courts can be reduced by carefully selecting the members of the court, the applicable language and laws, and the institutional rules that the court and parties should follow.
Arbitration is widely recognized in the UAE and provides an efficient and confidential alternative to court proceedings. The parties to the dispute can determine the scope, language, location, rules, arbitrators, and timing. It also provides a binding resolution to disputes through its adjudication process. The arbitration award must be approved by the UAE courts. The court should not re-examine the merits of the case. However, there are many procedural reasons why an award may be revoked, for example, when the arbitration agreement does not extend to the subject of the award or contains a time limit that has been exceeded.
The list of procedural grounds for setting aside an award is quite extensive. However, it is worth noting that many jurisdictions, even the 1958 New York Convention on Enforcement of Foreign Arbitral Awards, contain similar provisions. Parties unfamiliar with UAE arbitration should be cautious, as UAE courts attach great importance to procedural requirements. The arbitration award was set aside due to seemingly trivial mistakes, such as failing to use the oath required by law to swear to witnesses, or the court did not fully and adequately enforce the award.
Therefore, when appointing arbitral tribunal members (and legal representatives), it is important to ensure that they are experienced, arbitration professionals.
It requires careful consideration of the wording and form of any dispute resolution clause included in the contract. Failure to properly resolve disputes during contract negotiations can frustrate the parties and go through a lengthy and costly process in a forum that is neither beneficial nor effective for the project and the specific requirements of the parties.
(This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, or Religion, Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being. Further, despite all efforts made to ensure the accuracy and correctness of the information published, White Code VIA Mediation and Arbitration Centre Foundation shall not be responsible for any errors caused due to human error or otherwise.)