WHAT IS EXPERT DETERMINATION?

Expert determination is a contractual process by which parties agree to refer a dispute for determination by an independent expert. Unlike litigation and arbitration, expert determination is not governed by legislation or procedural rules (other than those agreed between the parties). This means that the parties may vary the rules and guidelines to suit the circumstances concerned and to choose the type of disputes to be referred to the expert. More importantly, the parties should agree whether the expert's determination is intended to be binding on the parties. Expert determination can be effective where parties disagree over specific technical or engineering issues or specialized issues, or have different views on what the contract requires, particularly in a long-term contract where there is considerable benefit to the parties to have a determination part-way through the contract to facilitate future discussions on the same issue.

EXPERT DETERMINATION ACCORDING TO PAM FORM 2018

​35.0 Expert Determination
35.1 At any time, the parties by written agreement may refer any disputes on all matters for determination by an expert.
35.2 If the parties fail to agree on an expert after fourteen (14) days from the date of the written agreement, any party can apply to the President of Pertubuhan Arkitek Malaysia to appoint an expert. Upon appointment, the expert shall initiate the expert determination in accordance with the current edition of the PAM Expert Determination Rules or any modification or revision to such rules.
35.3 Prior reference of the dispute under clause 35.1 shall not be a condition precedent for its reference to adjudication or arbitration by either the Contractor or the Employer, nor shall any of their rights to refer the disputes to adjudication under Clause 36.0 or arbitration under Clause 37.0 of these Conditions be in any way prejudiced or affected by this clause.

APPOINTMENT OF EXPERT

  1. Expert appointment process begins with the parties agreeing to refer their dispute to ED.
  2. Thereafter, any of the parties is required to make a written request to the President of PAM.
  3. Following this request, the President of PAM shall identify an expert to be appointed from professional institutions (The Royal Institute of Chartered Surveyors Malaysia (RISM), The Institution of Engineers, Malaysia (IEM), Association of Consulting Engineers, Malaysia (ACEM) and Pertubuhan Arkitek Malaysia (PAM)) and
  4. Notify the parties and the expert in writing. 
  5. The Appointed Expert will negotiate his terms of appointment.
  6. Upon Acceptance of his term, the Expert will proceed to conduct the preliminary meetings outlining the procedures and submission by all parties
  7. Upon completion of hearing/fact findings, the expert will produce his decision in writing.

Advantages

  • Expert Determination can be executed anytime during the progress of the work, thus its nature of ‘fast and furious’ to resolve matters on the spot.
  • Suitable for technical matters involving expert opinion such as defects, MnE, Structural or any Engineering aspect, not necessarily concerning payment
  • Purely by consensus and agreement by the parties to carry out this exercise. 
  • Economical with private and confidential dealings.

Disadvantages

  • Not mandatory at the moment without statutory enforcement.
  • Expert findings are not legally binding.