Dispute Avoidance Boards could change the way Australian projects handle conflict before it even starts.
Australia’s construction industry has entered a quiet but potentially transformative shift.
In June 2025, Standards Australia released AS 4000:2025, the long-awaited update to one of the most widely used contracts in the industry and for the first time, it formally introduces Dispute Avoidance Boards (DABs).
This move could mark the beginning of a new era in how disputes are managed and more importantly, how they’re prevented.
From Dispute Resolution to Dispute Prevention
For decades, Australian construction contracts have treated disputes as something to be resolved usually through arbitration or litigation, often long after trust between parties has eroded.
The revised AS 4000:2025 takes a different approach. Clause 42 now allows parties to “choose their own path,” with options like mediation, expert determination, or arbitration. But the standout inclusion is the Dispute Avoidance Board, a proactive system that focuses on keeping issues from escalating in the first place.
A DAB is typically made up of three independent experts, often engineers, project managers, and legal professionals appointed at the project’s outset. They meet regularly, attend site visits, and stay across the project as it unfolds. Their role is part referee, part facilitator, ensuring communication remains open and issues are dealt with before they snowball.
“The idea is to fix problems before they turn into disputes,” says Professor Doug Jones AO, a leading construction arbitrator and founding member of the Dispute Resolution Board Foundation (Region 3). “DABs are about prevention, not cure.”
Lessons from Abroad
The model isn’t new. Dispute Resolution Boards (DRBs) , the international equivalent, have been standard practice on major infrastructure projects in the US and Europe for decades.
According to the Dispute Resolution Board Foundation, more than 98% of disputes referred to DRBs are resolved without litigation, and 60% of projects using DRBs report no formal disputes at all.
Some of Australia’s biggest projects have seen the benefits firsthand.
The Sydney Desalination Plant and Adelaide Desalination Plant both adopted DRBs and both finished on time, under budget, and without major disputes. “The results speak for themselves,” says Jones. “DRBs build trust, discipline, and collaboration, three things our industry desperately needs more of.”
Why the Shift Matters
For builders, this isn’t just a legal update, it’s a cultural one.
The construction industry has long been marred by disputes that cost time, money, and relationships. The Australian Constructors Association estimates that disputes cost the sector over $560 million per year in direct costs alone.
Under AS 4000:2025, project teams can now select a dispute resolution structure that suits the project’s value, risk, and complexity and for larger or higher-risk projects, DABs may soon become the default.
It’s also a clear signal that Standards Australia wants to align with international best practice, similar to FIDIC’s (International Federation of Consulting Engineers) inclusion of DABs as standard in its 2017 contracts.
“Construction needs to move away from adversarial contracting,” says Jon Davies, CEO of the Australian Constructors Association. “Boards like this support collaboration and early intervention, which is key to lifting productivity across the sector.”
What Builders Need to Know
So, what does this mean for builders and contractors using AS 4000?
- You can now opt in to a DAB at the start of the contract.
- Decisions can be “interim binding” or “final and binding”, depending on the parties’ choice.
- Costs are typically shared, and while they can add up, DABs are reported to cost less than 0.3% of total project value, often cheaper than one formal dispute.
- They encourage ongoing collaboration, not one-off conflict resolution.
For most residential or mid-tier builders, DABs won’t be practical on every job. But for major commercial or infrastructure projects, they’re likely to become a go-to option for risk management.
“Even in smaller projects, the mindset shift is the real value,” says construction lawyer Toby Shnookal KC, author of Construction Disputes Down Under. “If parties think about dispute avoidance from the outset, they’ll manage risk better across the board.”
Limitations and Industry Scepticism
Not everyone is convinced.
Critics argue DABs add cost and complexity, and their value can be hard to justify on projects under $30 million. Others point out that alliance-style contracts, which promote collaboration without third-party oversight, already serve a similar purpose.
But there’s a growing consensus that the old ways aren’t working.
With construction margins tightening and workforce pressure rising, industry leaders are looking for systems that protect relationships and reduce downtime.
The Good Builder Take
For builders, this update isn’t just legal housekeeping, it’s an opportunity to work smarter.
Disputes destroy trust, and trust is the foundation of every successful project. DABs won’t replace good communication or leadership, but they do create a framework that supports both.
At a time when confidence in the construction sector is still being rebuilt, this shift shows Australia taking a step toward a more collaborative, mature contracting culture, one where prevention, not reaction, defines success.
Or as Doug Jones puts it:
“Good contracts don’t just manage risk, they build relationships.”
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