change orders, contractors either gave less competitive bids or did not bid at all. The disputes began accumulating and draining a significant amount of resources. Payment processing often required a great deal of administrative support—lawyers, auditors, procurement people, and other support departments. Costs escalated, and sometimes it took years to resolve the more complex disputes.

WMATA’s initial efforts to research alternative methods for resolving claims began in 1985 with draft contract provisions for a mini-trial. The effort was inspired in part by the success of the Army Corp of Engineers’ mini-trial procedures and WMATA’s desire to find an alternative to the ENG BCA process. WMATA’s real success with dispute resolution came in 1992, after the federal government enacted the alternate dispute resolution (ADR) law (Public Laws 101-552; 102-354). The agency had several champions at different levels to further advance the use of ADR and convince the WMATA Board of Directors to give the new process a chance to reduce the backlog of cases. The following anticipated benefits were a motivating factor:

  • Early resolution of disputes,

  • A climate of understanding and environment of cooperation between the parties,

  • A reduced backlog of issues and claims,

  • Limited posturing by the parties,

  • Simple, transparent, consensual procedures, and

  • Cost effectiveness.

Former and current directors of WMATA’s Office of Construction led the effort to establish DRB and partnering provisions that have been part of all major construction contracts since 1993. Most recently, management has encouraged the expansion of dispute resolution to include mediation, in addition to the current DRB process. Project managers are asked to recommend the dispute method that is most advantageous to their contracting process and specific project.

Acceptance of the use of ADR techniques did not come easily. Initially the general counsel’s office did not support the process because of concerns that DRBs would favor contractors or “split the difference” in resolving claims, and that WMATA would be required to pay uncalled-for sums of money for resolution. However, WMATA’s top management pushed for and supported ADR, which made change ultimately possible.


The addition of a DRB and partnering in contracts affords the parties an opportunity to solve issues during contract performance rather than after completion. Depending on the complexity of the contract, contractors and project teams receive a briefing to better understand the situation. If an issue emerges, project participants are all aware of what is happening and are in a position to help resolve the issue quickly and effectively. A DRB is especially effective in disputes over the merits of a claim because a neutral party can influence and guide both sides toward a mutually acceptable resolution. In a high-profile situation where public money is involved, it is important to resolve not only the issue, but also the appearance of conflict to avoid negative publicity.

A recent major tunneling project illustrates the effectiveness of using a DRB. In this case, a contractor claimed a differing site condition. The issue was brought immediately before the DRB, which concurred that there was a differing site condition. Based on this decision, WMATA and the contractor negotiated a modification for extra work, and the contractor finished the work without a claim. By resolving this issue early, the parties removed the uncertainty regarding responsibility, and the work progressed with a clear understanding of which party was responsible for the additional costs. WMATA has used these techniques on all major projects (more than $20 million) and all at-risk projects.

In a similar case, a contractor bypassed the DRB hoping to get full relief through the courts. He lost in front of a jury, appealed, lost the appeal, and petitioned the Supreme Court only to have his appeal

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