The Need for a New Procedural Design to Handle Construction Disputes in Ethiopia

Many construction contracts mention adjudication as a one option for resolving construction disputes in Ethiopia. In the context of construction contracts, adjudication refers to the process of resolving disputes or disagreements that may arise between the parties involved in the contract. It is a form of alternative dispute resolution (ADR) specifically designed for the construction industry. Adjudication typically involves appointing an impartial third party, known as an adjudicator who reviews the dispute and makes a binding decision on issues such as payment, variations, delays, defects, or other contractual matters. The adjudicator’s decision is enforceable and temporary, meaning it provides a quick resolution to the dispute that allows the construction project to progress while the parties work towards a final resolution, such as arbitration or litigation.

This method of dispute resolution offers many advantages for the construction sector. Among other things, it ensures a speedy and efficient decision as it is designed to provide a swift decision allowing the parties to move forward with the project and avoid delays. It is also cost effective as the design makes it less formal resulting in lower legal and administrative costs for the parties involved. It also gives room for expertise and specialist adjudicators who can make informed and knowledgeable decisions. Although adjudication decisions are typically interim, meaning they provide temporary solutions to the disputed issues pending the final determination through other means, such as negotiation or arbitration, they are legally binding and enforceable.

Adjudication is a valuable system for resolving construction disputes. However it needs an effective domestic legal framework that establishes the legal basis and procedures for adjudication in construction disputes. This legal framework should outline the scope of disputes that can be adjudicated, the appointment process for adjudicators, timelines for resolution, and the enforceability of adjudication decisions. Without such framework, adjudication would only remain a paper tiger.

Adjudication is often mentioned in many construction contracts as one method for resolving disputes in Ethiopia. The legal framework In Ethiopia, however, does not provide the necessary legal support for adjudication. There are no legal rules that ensure the enforceability of decisions rendered by an adjudicator. Thus, unlike arbitral awards, decisions by an adjudicator cannot be directly enforced by the ordinary courts. The full range of the advantages of adjudication cannot thus be enjoyed in Ethiopia until such legal loopholes are properly addressed.

We need to explore ways to strengthen the foundation of adjudication in Ethiopia by advocating for a new procedural design suitable for construction contracts.