A dispute board can lose its value faster through loss of legitimacy than through a technically imperfect recommendation.
The Robert Hunt paper does not present DRBs as infallible.
It discusses a Los Angeles project in which the status and authority of a board became part of prolonged litigation after termination of the underlying contract. The source then extracts several lessons from criticism of board-member behaviour: private communications, perceived bias, prejudgment and providing advice beyond the scope of a referred dispute.
That negative evidence is strategically important.
It shows that the same familiarity that gives a standing neutral its advantage can create risk if boundaries are weak.
The Strategic Context
A dispute board sits close to the project.
Members visit site.
They receive reports.
They meet the parties.
They observe progress.
They build views about the people, systems and recurring problems.
That context allows speed.
But it also creates a danger.
If the board starts informally advising one party, forming conclusions before a referral, or extending its role into project management, the parties may stop viewing it as neutral.
Once that happens, the board's recommendations become easier to challenge and harder to accept.
What Leaders Commonly Misread
The first mistake is assuming experienced professionals cannot become biased.
The issue is not only actual bias. Perception matters.
The second is encouraging the board to “help the project” without defining boundaries.
A useful informal conversation can drift into technical advice or prejudgment.
The third is ignoring the status of the board after major contractual events such as termination.
The supplied historical case illustrates that questions about whether a board continues to exist can themselves become disputed.
Current law and modern contract forms require verification. [FACT CHECK REQUIRED]
The fourth is allowing private communications because they seem efficient.
The source strongly cautions against this.
The fifth is assuming a board's historical success rate guarantees good performance on a specific project.
Governance quality still matters.
Reframing the Issue
DRB failure can be understood through four legitimacy risks.
Information asymmetry
One party communicates privately or receives unequal access.
Role overreach
The board becomes a consultant, peer reviewer or project manager.
Premature judgement
Members appear to decide before hearing the referred issue.
Authority ambiguity
The parties disagree about what the board can decide or whether its role survives a contractual event.
These are governance failures before they become legal failures.
Strategic Analysis: Familiarity Needs Boundaries
Consider a hypothetical infrastructure project.
A board member regularly discusses site difficulties with the contractor's project manager during informal visits. The intention is constructive.
Months later, a dispute arises about one of those difficulties.
The principal now believes the member has already heard one side repeatedly and formed a view.
Even if the member can remain objectively fair, the process has lost perceived neutrality.
The lesson is not to make the board distant.
It is to structure familiarity through transparent channels.
Joint site visits, shared reports and copied communications allow members to learn the project without creating asymmetrical access.
Overreach Can Weaken Accountability
A board that starts directing solutions can also blur project accountability.
The superintendent, project manager and contractor remain responsible for delivery under the contract.
A DRB should not casually become a shadow management team.
If it does, later disputes can become harder because responsibility for decisions is unclear.
The source explicitly warns that board members are not consultants, peer reviewers or construction managers.
That is a valuable boundary.
Strategic Analysis: Governance Failure Can Become Self-Reinforcing
Once one party loses trust in the board, behaviour can change quickly.
It may stop referring emerging differences, reserve issues for arbitration, challenge procedural decisions and scrutinise every communication for bias.
The board then receives less useful information, becomes less familiar with live issues and loses more value.
This creates a negative feedback loop.
Early legitimacy concerns should therefore be treated as project risks in their own right.
A transparent review, recusal where appropriate or replacement process may preserve the mechanism better than allowing mistrust to accumulate.
The objective is not to protect the board as an institution.
It is to preserve a credible dispute-avoidance pathway for the project.
Decision Framework
Apply the DRB Legitimacy Test periodically.
Equal access
Are all substantive communications visible to both parties?
Scope discipline
Is the board staying within its contractual role?
Open mind
Are members avoiding statements that suggest prejudgment?
Authority clarity
Do the parties agree on what the board can do?
Conflict management
Are actual and perceived conflicts being monitored?
Process integrity
Are hearings and recommendations following the agreed rules?
If legitimacy weakens, early corrective action is essential.
From Strategy to Execution
Immediate action: establish communication protocols and conflict rules at the first board meeting.
Medium-term capability building: conduct periodic governance reviews of the DRB process, not only of disputes.
Long-term strategic positioning: preserve lessons from both successful and failed boards to improve standard contract clauses and member-selection criteria.
Signals to Monitor
Watch for private calls, one-sided site conversations, members proposing project-management solutions outside referrals, parties complaining that views are predetermined, uncertainty after termination or suspension, repeated procedural objections, or a sharp decline in willingness to refer emerging issues.
Another warning sign is when lawyers begin arguing about the DRB itself rather than the underlying project issue.
Questions for the Leadership Team
- Are communications genuinely equal?
- Has any member crossed from neutral into adviser?
- Could either party reasonably perceive bias?
- Is the board's authority clear after major contractual events?
- Are members deciding only issues properly referred?
- Is the process still trusted by site teams?
- What corrective action is needed before legitimacy deteriorates further?
Closing Perspective
Dispute boards work because parties accept the credibility of the process.
That credibility depends on independence, procedural fairness and disciplined boundaries.
A standing neutral should know the project well.
It should never become part of one side's project team.
Related article: How to Design a Dispute Board That Parties Can Trust
Related article: A Standing Neutral Changes the Economics of Disputes
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