Construction projects often are particularly susceptible to conflicts due to their long- term character and complexity. In Germany, courts must deal with around 100,000 construction dispute litigations per year. Alternative Dispute Resolution (ADR) can be an alternative to expensive as well as time-consuming litigation and can help to relieve the judicial system. Furthermore, ADR may contribute to the satisfying settlement of a dispute between parties involved in the construction process and thus help to reach construction projects’ completion on time and within budget. Often, ADR mechanisms such as adjudication, mediation, and conciliation will be used. The paper analyzes the development of ADR in Germany in conjunction with European legal aspects. With special reference to the construction industry practice in Germany, various ADR measures and their advantages and disadvantages, as well as the current situation, will be explained. The authors conclude that, although ADR in Germany has experienced an upswing since the 1990s, it is used only to a small extent for settling disputes in construction projects. An increased knowledge about the advantages and disadvantages of different ADR measures in the construction industry would lead to more frequent uses of ADR. That, and a clever and detailed contract design, which helps to avoid conflicts basing on unclear contract contents, could save money and relieve the courts from time-consuming legal proceedings.
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