REALWorld Law

Construction

Dispute resolution in the courts

Which courts specialize or deal with construction disputes? Can decisions be appealed?

Angola

Angola

In Angola there are no specific construction courts. Civil courts have jurisdiction to determine disputes concerning construction works, but there are specialized sections to decide disputes involving public administration. As a rule, the parties have a right of appeal to a higher court in order to have the first decision overturned.

Australia

Australia

Courts operate at both federal and state government levels in Australia. The separation of powers means that courts are independent of and separate to parliament and the executive government.

In most cases the jurisdiction of a court is governed by the amount in dispute or, in the case of the federal Courts, the subject matter of the dispute. In Australia, the highest level Court in each state – usually called a Supreme Court – has inherent jurisdiction to resolve a dispute.

In some jurisdictions industry-specific tribunals have power to hear disputes (for example the Land and Environment Court in New South Wales and the Domestic Building List in the Victorian Civil and Administrative Tribunal).

Unless the parties specifically and expressly agree to refer a dispute to arbitration, a claim must be pursued in a court.

In many jurisdictions specific lists have been established to manage building disputes. These lists are managed by a judge with experience in hearing such disputes, and are intended to enable prompt hearing of interlocutory or preliminary arguments, assist with the quick identification of the issues and enable a hearing date to be obtained at the earliest possible time. These specialist lists may incorporate a number of special features to enable prompt and timely settlement of disputes, such as:

  • Referral to compulsory mediation
  • If appropriate, determination by the court of a preliminary point in order to dispose of the dispute or limit the issues in dispute
  • Referral to a special referee to consider key technical questions
  • Dividing the proceeding into an assessment of liability and then amount (if the claim is successful)

While some courts will grant a trial date at the first directions hearing, in other courts there may be a time delay of up to two years until the trial commences.

Decisions of the Supreme Court for each State and Territory can be appealed to the Court of Appeal Division of the Supreme Court. The ultimate court of appeal in Australia is the High Court of Australia.

Belgium

Belgium

Construction dispute resolution in the courts is governed by Belgian general procedural law. Where a dispute arises between companies (that is to say entities that, on a permanent basis, have an economic object or purpose), the Belgian commercial courts will have jurisdiction in such a dispute. The Belgian commercial courts are well positioned to deal with construction disputes between professional parties, partly due to the fact that each commercial court is headed by a president and two lay judges experienced in commercial affairs.

Decisions of the commercial courts can be appealed before the court of appeal of the district in which the commercial court is located and this should take place, if an appeal claim is lodged, in principle, within one month after notification of the judgement of the commercial court.

Bosnia-Herzegovina

Bosnia-Herzegovina

There is no a specific court that deals with construction disputes only. This depends on the nature of the construction in dispute. The courts of first instance are the municipal or basic courts. The court of first instance can reach a judgment which can be appealed in a higher court.

Once the higher court decides on an appeal, the judgment becomes final and legally binding and cannot be appealed further. However, these judgments can still be the subject of a special procedure in exceptional circumstances known as 'revision'. This application is filed with the supreme court and if successful, can reverse the decisions of the lower courts.

Canada

Canada

Generally, construction disputes are heard in the Supreme Court of the province or territory where the project is located. Canadian 'Supreme' or 'Superior' Courts (referred to as 'Queen’s Bench' in some provinces) are cloaked with both legal and equitable jurisdiction. So, unlike some jurisdictions in the United States, there is no separate equity or chancery court, for equitable relief such as an injunction or specific performance.

A relatively small number of construction disputes can also be heard in Canada’s federal court if the resulting claim arises from the provision of goods or services to the federal government.

Final decisions of these courts generally can be appealed to intermediary court of appeals. Any appeals thereafter to Canada’s highest court, the Supreme Court of Canada, are generally at the discretion of the Supreme Court of Canada, particularly for construction cases which may not be considered to be of sufficient national importance – the threshold test for the exercise of the Supreme Court of Canada’s discretion.

China

China

No specialist courts exist for construction disputes.

Croatia

Croatia

Commercial courts are competent for construction disputes between tradesmen (ie companies within their scope of business), whereas municipal courts are competent for other construction disputes. There are no further specific courts for construction disputes.

Czech Republic

Czech Republic

Disputes arising from the administrative procedures (relating to decisions of building authorities)

These are reviewed in the administrative courts. These disputes commence at regional level and an action appealing against a decision must be filed within two months of the original notification of the decision. An appeal against the decision of a regional court (cassation) must be filed within two weeks of delivery of decision. The admissibility of such a complaint is limited to certain grounds stipulated by law. It should also be noted that, in an appeal, the complainant must be represented by a lawyer. Complaints are subject to the jurisdiction of the Supreme Administrative Court.

Construction disputes relating to civil law (between parties whose relationship is governed by private law)

These are dealt with by the civil courts of justice. There are no specialized courts for construction disputes in the Czech Republic. The competent court of first instance is the district court. Any appeals against decisions of the district courts are dealt with by the regional courts. A review of a decision of the regional court is dealt with by the Supreme Court.

Appeal

Czech law also provides, in certain cases, the opportunity for extraordinary appeal, dealt with by the Supreme Court.

Denmark

Denmark

The Building and Construction Arbitration Court in Copenhagen decides disputes between the parties.

The Building and Construction Arbitration Courts decisions are final and conclusive.

Unless the parties have agreed to apply AB 18 or ABT 18 including the arbitration clause their dispute will be referred to the public courts.

France

France

There are no specific construction courts or tribunals operating in the private sector. Claims will start either before a Tribunal d'Instance or a Tribunal de Grande Instance. All decisions can be appealed to the Court of Appeal (Cour d'Appel). The ultimate court of appeal in France is the Cour de Cassation.

Germany

Germany

Due to the amounts involved in such cases (usually above €5,000) the Regional Courts (Landgerichte) deal with legal disputes relating to construction projects. The Local Courts (Amtsgerichte) deal with cases involving smaller amounts. Some Regional Courts have special chambers for construction matters. In accordance with the new construction contract law, the Regional Courts and the Higher Regional Courts (Oberlandesgerichte) now have to set up civil chambers and senates which are specialized in disputes arising out of construction contracts.

The local jurisdiction of the civil courts depends on the location of the registered office of the debtor. The location of a branch office of the contracting party may also be chosen as the venue for any disputes. In addition, the location where the construction work is performed may determine the venue for legal proceedings. Because of these various possibilities, the parties usually agree on a specific venue.

Judgements or decisions of the Local Courts can be appealed in the Regional Court or the Higher Regional Court (Oberlandesgericht) and judgments or decisions of the Regional Courts can be appealed in the Higher Regional Court or the Federal Court of Justice (Bundesgerichtshof), depending on the specific matter in question. The ultimate court of appeal in Germany is the Federal Court of Justice.

Hong Kong

Hong Kong

The Hong Kong courts of civil jurisdiction have inherited an adversarial system where the parties themselves initiate the proceedings and decide what issues of fact and law are put forward for the decision of the court.

Most construction litigation over a project of normal size comes under the jurisdiction of the Court of First Instance of the High Court of Hong Kong (CFI) which has jurisdiction of unlimited financial value.

A Construction and Arbitration List exists within the CFI to facilitate the disposal, by the designated judge in charge of the list, of the specialized classes of litigation concerning matters of civil or mechanical engineering, building or other construction work, claims regarding professionals or besides specializing in practice related to the construction industry and arbitration.

On appeal, the disputes will be dealt with by the Court of Appeal and, if necessary and allowed, by the Court of Final Appeal which is the highest court in Hong Kong. Appeals conducted by the Court of Appeal are at present by way of rehearing. It is open to the Court of Appeal to re-assess the facts, albeit generally only on the basis of documentary record rather than by rehearing oral evidence afresh.

In construction litigation, the prospective appellant faces added dimensions of difficulty. The appellant court may be reluctant to intervene or change the findings of fact of the trial judge, particularly if the trial judge had the benefit of inspecting the site of the subject matter in dispute.

Hungary

Hungary

The general ordinary courts deal with construction disputes as no specialized courts exist. However, technical experts/consultants are often involved, including the Performance Certification Expert Board, which at the request of the parties (eg the contractor or designer) will deliver an expert opinion as to whether the contractor’s performance complied with statutory requirements and the conditions of the construction contract.

Claims of lesser value will start in a district court, whilst more substantial claims will be heard in a regional court (in Budapest, this is the Metropolitan Court). First instance decisions of the ordinary courts can be appealed either to the regional court (Metropolitan Court) or the Regional Court of Appeal depending on which court acted as the court of first instance. The ultimate court of appeal through the supervisory proceedings is the Curia (Supreme Court of Hungary).

Ireland

Ireland

No court in Ireland is charged exclusively to hear construction disputes.

Construction disputes in Ireland are dealt with in particular courts, depending on the amount in dispute, which are as follows:

  • District Court: disputes up to €15,000
  • Circuit Court: disputes up to €75,000
  • High Court: unlimited jurisdiction
  • Commercial Court (which is a branch of the High Court): disputes in excess of €1 million

Decisions of all courts can be appealed. Prior to July 2014 decisions of the High Court/Commercial Court could only be appealed to the Supreme Court on a point of law (except where arbitral awards are appealed to the High Court, where the right of appeal to the Supreme Court is limited by Section 11 of the Arbitration Act 2010).

On 20 July 2014, following a referendum in Ireland, the Court of Appeal Act 2014 was signed into law and established a general Court of Appeal which sits between the jurisdiction of the High and Supreme Courts. The Court of Appeal is the default court for appeals from the High Court/Commerical Court. In exceptional circumstances the Court of Appeal can be 'leapfrogged' and a ruling can be appealed directly to the Supreme Court. Appeals to the Supreme Court will generally only be permitted where:

  • The decision involves a matter of public importance, and/or
  • The interests of justice require that the appeal be heard by the Supreme Court
Italy

Italy

There are no specific construction courts or tribunals operating in the private sector. Construction disputes are dealt with by territorial courts (Tribunali). Therefore, decisions of the courts can be appealed.

Japan

Japan

There are no specific courts dealing with construction disputes. Construction disputes are dealt with by normal civil courts, therefore, decisions of the courts can be appealed.

Netherlands

Netherlands

In the Netherlands, disputes arising from a construction contract can be brought before either a civil-law court or an arbitration board. All Dutch courts (in all districts) are competent to take on construction disputes. There are no specific ‘construction courts’. In practice, parties often agree to settle any disputes by means of arbitration. Arbitration is usually preferred over proceedings before a civil-law court, because of the expertise that arbitrators have and the speed of the proceedings. Conversely, arbitration is usually more expensive than civil-law court proceedings.

Nigeria

Nigeria

There is no court established by law in Nigeria specifically for the purpose of adjudication on construction disputes. Construction disputes being civil matters arising from contract fall within the jurisdiction of the High Court of the state where the property or project is located. The decision of the High Court can be appealed to the Court of Appeal and the decision of the Court of Appeal can also be appealed to the Supreme Court being the apex Court in Nigeria.

Norway

Norway

In Norway, construction disputes are heard by the ordinary courts. There are no specific courts which specialize in construction disputes. Disputes are heard before the District Court. As the District Court does not specialize in construction disputes, both parties may require that the court has two expert lay judges. The expert lay judges will not be lawyers, but will have expertise in relation to the relevant matter in dispute.

The District Court’s decision can be appealed to the Court of Appeal. The parties can also require that two expert lay judges sit on the Court of Appeal, together with the three ordinary judges.

A decision of the Court of Appeal can be appealed to the Supreme Court. It is only possible to bring an appeal to the Supreme Court in certain limited situations. The Supreme Court only deals with appeals which involve questions that are of significance beyond the particular case, or if it is particularly important that the Supreme Court deals with the appealed case.

Poland

Poland

Civil law disputes are between contracting parties and fall within the competence of a common court. Claims of lesser value start in a district court while more substantial civil claims are heard in the regional court.

Portugal

Portugal

In Portugal, public and private works are subject to the jurisdiction of different courts. Civil courts have jurisdiction to determine disputes concerning private works; administrative courts determine disputes concerning public works. As a rule, in both cases, parties have a right of appeal to have the first decision overturned.

Romania

Romania

Depending on the amount at stake, the competent courts to deal with construction disputes are either the Courts of First Instance or the Tribunals.

Administrative disputes are resolved by the special sections of the contentious administrative courts, while commercial cases fall under the commercial sections of the Romanian Courts. Under Romanian Legislation the court's decision can be appealed at a higher level subject to the limitation period established by law.

Russia

Russia

Under Russian law, disputes arising as a result of the breach of construction contracts are generally addressed to the state arbitrazh (commercial) courts (arbitrazhny sud). Decisions of the arbitrazh courts can be appealed to the Russian court of appeal and the 'cassation' court. Generally, a party can lodge two cassation appeals:

  • To the arbitrazh court of the relevant region (first cassation appeal), and subsequently
  • To the Economic Collegium of the Supreme Court of the Russian Federation (second cassation appeal)

The Presidium of the Supreme Court of the Russian Federation can reconsider a case if the decisions of the lower courts violate existing judicial practice or citizens' principal rights and liberties.

Slovak Republic

Slovak Republic

In Slovakia there are no specialized courts which are concerned exclusively with construction disputes. Thus, any construction disputes are tried by 'general' district courts. The administration of justice is governed by a two-tier system which means that any disputes relating to the contract for construction works arising between a contractor and a client fall within the jurisdiction of district courts being first-instance courts.

In general, a party may appeal against the decision rendered by a district court. The second instance is then exercised by regional courts being appellate courts. An appeal against a decision rendered by a district court is the only ordinary legal remedy available. Although, the Civil Procedure Act provides for extraordinary legal remedies such as the reopening of a case and appellate review however, these can be filed only if specific statutory conditions are met.

Spain

Spain

In Spain proceedings are commenced by issuing a claim form accompanied by all the original documentation on which the plaintiff bases its claim. Civil claims in Spain are brought in the Court of First Instance and commercial claims (related to bankruptcy proceedings, unfair competition, industrial properties, and corporate matters such as challenging the decisions of a shareholders' meeting) are brought in the Commercial Court.

Rulings issued by the Court of First Instance and Commercial Court may be appealed in the Provincial Court (Recurso de Apelación). In Spain the parties have a 20-day period for the appeal to be filed. In the event that the losing party does not file the appeal within the time allowed, the court will treat the appeal as abandoned or waived, and the judgement becomes final. In an appeal the parties cannot bring forward, or file, new evidence other than documents dating from after the trial or which could not be obtained previously for reasons beyond the control of the party bringing the evidence.

Sweden

Sweden

There are no courts which specialise in construction disputes.

Disputes settled by a public court can be appealed. 

Thailand

Thailand

A specialist court for construction disputes does not exist in Thailand. Claims relating to construction disputes are submitted to the court with territorial jurisdiction covering the defendant, or to the court within territorial jurisdiction over the place in which the cause of action arose, in which case it is unnecessary for the defendant to have a domicile in Thailand.

Court decisions may be appealed. Thailand's court system has three levels: the Court of First Instance, the Court of Appeal and the Supreme Court. If the parties disagree on the judgment rendered by the Court of First Instance, either party may appeal the decision to the Court of Appeal. Similarly, either party may appeal the judgment of the Court of Appeal to the Supreme Court.

United Arab Emirates - Abu Dhabi

United Arab Emirates - Abu Dhabi

There are no courts that specialise in construction disputes, however there are plans to create specialist construction courts in Abu Dhabi in due course. Until that time, construction cases are dealt with by the Courts like any other commercial case.

United Arab Emirates - Dubai

United Arab Emirates - Dubai

There are no courts that specialize in or deal with construction disputes. Construction disputes (if litigated) are likely to be resolved by the civil courts.

The parties may agree to submit to the jurisdiction of the courts in the Dubai International Financial Centre (DIFC) however as these courts are primarily commercial courts it is unclear how they would address complex construction issues.

UK - England and Wales UK - England and Wales

UK - England and Wales

In civil cases, litigation is commenced by a ‘claimant’ against a ‘defendant’. Claims of lesser value will start in a local or regional court known as the ‘County Court’. More substantial civil claims are heard in the ‘High Court’ which is based in London but has 10 other regional centres across England and Wales. The High Court consists of a number of divisions; one of them, the ‘Queen’s Bench Division’, is home to the specialized ‘Technology and Construction Court’ (TCC) which deals principally with technology and construction disputes. Decisions of the TCC can be appealed to the Court of Appeal (Civil Division). The ultimate court of appeal in the UK is the Supreme Court.

UK - Scotland

UK - Scotland

In civil cases, litigation is commenced by a 'pursuer' against a 'defender'. Claims of lesser value will start in a local court, the Sheriff Court. More substantial civil claims are heard in the Court of Session, often using the more streamlined commercial action procedure. The Court of Session consists of an 'Outer House' and an 'Inner House'. Decisions of the Outer House can be appealed to the Inner House. The ultimate civil court of appeal in Scotland is the Supreme Court of the United Kingdom. For small claims that are worth less than £5,000, the Simple Procedure can be used (which does not require the involvement of a solicitor).

Ukraine

Ukraine

Construction disputes between companies are settled in commercial courts. Disputes with the participation of individuals are settled in courts of general jurisdiction. Disputes involving state/municipal authorities and disputes relating to challenging the acts/powers of such bodies are settled by the administrative courts. Decisions of courts of first instance can be appealed to the courts of appeal and ultimately to the Supreme Court of Ukraine.

United States

United States

Generally, construction disputes are heard in the civil court of the state where the project is located. If the claimant asks for something other than damages, for example, a party requests an injunction or specific performance, then the case will be heard in the state’s equity court, often called chancery court. Otherwise, the case will be heard in a court of law.

However, construction disputes can be heard in federal court, if the resulting claim arises from a federal construction project, involves a federal question of law, or meets certain other criteria that allows the claim to be heard in federal court, such as diversity jurisdiction.

Final decisions of these courts generally can be appealed to an intermediary court of appeals. Any appeals thereafter to a higher court are at the discretion of the higher court.

Zimbabwe

Zimbabwe

Complaints relating to engineers may first be submitted to the Engineering Council of Zimbabwe. As there is no specialist court dealing with construction issues, claims for smaller amounts of money may be dealt with at the Magistrates’ Court whilst the High Court deals with claims for larger amounts. Appeals are to the Supreme Court are possible. The establishment of a commercial court, which will be a specialist division of the High Court is currently under way. Further, rather than approaching the courts, parties may also nominate to use arbitration procedures.