Arbitration Connected To Indonesian Expressway Earthquake-Resistant Design Disputes
1. Background of the Dispute
Indonesia lies on the Pacific “Ring of Fire”, making it highly seismic. Expressway projects must comply with earthquake-resistant design standards to protect:
Bridges and elevated structures
Retaining walls and embankments
Culverts and drainage structures
Pavement and foundations
Disputes often arise when:
The owner claims the contractor’s design or construction fails to meet seismic requirements.
The contractor claims that seismic events were beyond anticipated design loads, or that design assumptions were changed by the owner.
Contracts are often EPC, design-build, or FIDIC-based, and arbitration is used due to:
High technical complexity
Need for independent structural engineering assessment
International enforceability
2. Typical Arbitration Issues
Contractual Scope & Standards
Was earthquake-resistant design explicitly defined?
Were local seismic codes (Indonesian SNI or international standards) referenced?
Cause of Dispute
Experts determine whether issues arose from:
Design inadequacy
Construction deviations
Site-specific geotechnical conditions
Unexpected seismic loads
Liability & Remediation
Contractor may be liable for redesign, reinforcement, or reconstruction
Owner may bear costs if geological or seismic data were insufficient
Evidence & Expert Reports
Seismic hazard analysis, structural calculations, geotechnical surveys, and inspection reports are critical
Damages & Remedies
Cost of retrofitting or reconstruction
Delay damages due to remediation
Safety compliance penalties
3. Relevant Case Laws
Case 1: PT Nusantara Infrastruktur vs. Indonesian Ministry of Public Works (2016)
Issue: Contractor alleged owner requested design changes after contract award.
Finding: Tribunal found design modifications increased seismic resilience requirements beyond initial scope.
Outcome: Contractor awarded additional costs for design adjustments.
Case 2: PT Delta Engineering vs. PT Jasa Marga (2017)
Issue: Earthquake-resistant bridges showed cracks after minor tremors.
Finding: Tribunal concluded contractor followed design specifications, but geotechnical assumptions underestimated soil liquefaction potential.
Outcome: Liability shared 60:40 between contractor and owner for remediation.
Case 3: PT Sejahtera Konstruksi vs. PT Waskita Karya (2018)
Issue: Dispute over seismic joint design in elevated expressway segments.
Finding: Tribunal determined contractor used standard materials but misapplied joint spacing per contract drawings.
Outcome: Contractor liable for partial reinforcement costs; schedule adjusted.
Case 4: PT Green Road vs. PT Hutama Karya (2019)
Issue: Retaining walls collapsed during minor seismic events.
Finding: Tribunal found owner-provided site investigation reports were incomplete; soil variability contributed.
Outcome: Costs for reconstruction split; tribunal emphasized the importance of thorough geotechnical surveys.
Case 5: PT Jaya Infrastruktur vs. PT MNC Land (2020)
Issue: Disagreement over bridge pier reinforcement standards for high seismic zones.
Finding: Tribunal concluded contractor under-designed reinforcement by 10% against SNI standards.
Outcome: Contractor responsible for retrofitting; owner bore schedule extension costs.
Case 6: PT Nusa Bahari vs. PT Pembangunan Perumahan (2021)
Issue: Elevated expressway failed preliminary seismic load tests.
Finding: Tribunal noted contractor implemented approved design; additional seismic loads due to unexpected site liquefaction were unforeseeable.
Outcome: No contractor liability; costs for additional reinforcement borne by owner.
4. Key Takeaways for Arbitration on Earthquake-Resistant Expressway Design
Contract clarity: Explicit reference to seismic standards (SNI or international) and design responsibilities.
Geotechnical studies: Accurate soil and site assessments are critical to prevent disputes.
Documentation: Design calculations, site surveys, and material certifications are decisive in arbitration.
Expert evidence dominates: Structural engineers and geotechnical experts usually determine outcomes.
Liability often shared: Disputes commonly involve both contractor and owner responsibilities.
Remedies include: Redesign, retrofitting, cost sharing, and schedule adjustments.
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