Arbitration of Disputes in the Construction Industry
Publication: Journal of Legal Affairs and Dispute Resolution in Engineering and Construction
Volume 16, Issue 4
Abstract
The construction industry is one of the main economic sectors in Iran, significantly impacting the country’s growth and prosperity. The dynamism, complexity, and conflict of interest in the construction industry lead to increasing conflicts and disputes in construction projects. Disputes usually arise due to ambiguity in contract documents, changes in quantities and specifications, contradictions in contract documents, and delays in fulfilling financial and contractual obligations. These disputes must be resolved promptly to avoid any negative impact on the project’s time and cost and the viability of its economic relationships in the future. Arbitration has been used as a dispute resolution method as it is a faster and more cost-effective method of dispute resolution than litigation. Furthermore, contractors prefer arbitration for dispute resolution in international construction contracts because it saves time and money and avoids litigation in local courts. The article examines the concept of arbitration as an alternative dispute resolution method and its application in the construction industry of Iran, with a specific focus on the country’s arbitration law. In this research, in addition to examining the structure, rules, and regulations governing dispute arbitration in Iran, 12 semistructured interviews were used to review and criticize dispute resolution by arbitration method in Iran’s construction industry. Surveys indicate that Iran’s domestic and international arbitration laws are harmonized with international laws partly. The legislator in Iran has considered appropriate powers for the arbitrator, and according to the existing laws, arbitration awards are recognized and implemented in domestic courts. The current procedures under the arbitration law and the reasons for the minimal use of arbitration compared to the number of lawsuits filed in Iran’s judicial courts have been examined, and the effective factors in this matter have been identified. Finally, some recommendations have been provided for the development and progress of arbitration in Iran.
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Data Availability Statement
All data, models, and code generated or used during the study appear in the published article.
References
List of Statutes
Civil Procedure Law Act of 2000 (in Persian),
General Condition of Contract, Code 4311, 1999 (in Persian), Plan and Budget Organization.
International Commercial Arbitration Law Act of 1997 (in Persian).
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Information
Published In
Journal of Legal Affairs and Dispute Resolution in Engineering and Construction
Volume 16 • Issue 4 • November 2024
Copyright
© 2024 American Society of Civil Engineers.
History
Received: Aug 16, 2023
Accepted: Feb 13, 2024
Published online: Jul 26, 2024
Published in print: Nov 1, 2024
Discussion open until: Dec 26, 2024
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