1. Meaning of Snagging List in Construction Projects

A snagging list is a document prepared near project completion (or during handover) that records:

• Defects in workmanship (plaster cracks, leakage, uneven flooring, etc.)
• Incomplete works (fixtures, finishing, painting)
• Deviations from specifications/BOQ
• Minor functional issues before final acceptance

It is commonly used in construction contracts during the Defects Liability Period (DLP) or handover stage.

2. What is “Snagging List Disagreement”?

Disputes arise when:

• Contractor says “work is complete as per contract”
• Employer says “snags are defects and must be rectified”
• Engineer/consultant certification is disputed
• Cost of rectification is contested
• Delay in issuing completion certificate or final payment occurs

3. Arbitration in Snagging List Disputes

Most construction contracts include an arbitration clause, making arbitration the primary dispute resolution mechanism.

Typical arbitration issues:

• Whether items in snag list are defects or acceptable variations
• Whether employer can withhold payments
• Liability for rectification cost
• Whether completion certificate is wrongly withheld
• Delay damages due to snag rectification

Arbitrators usually rely on:

• Contract conditions (FIDIC/CPWD or bespoke contracts)
• Engineer’s certification
• Site inspection reports
• Expert technical evidence

4. Key Case Laws (India) Relevant to Snagging/Construction Arbitration

1. ONGC v Saw Pipes Ltd (2003 Supreme Court arbitration case)

Principle: Broad interpretation of “public policy” and enforceability of arbitral awards.

• The Supreme Court held that an award can be set aside if it is patently illegal
• In construction disputes, if an arbitrator ignores contractual defect obligations, award may be challenged
• Important for snag disputes where contractor claims completion despite defects

Relevance: Courts may interfere if arbitrator ignores clear snag/defect clauses.

2. Associate Builders v Delhi Development Authority (2014 Supreme Court arbitration case)

Principle: Limited judicial interference; defines “perversity” in arbitral awards.

• Court cannot reappreciate evidence in construction disputes
• If arbitrator reasonably interprets snagging obligations, award stands
• Only perverse or irrational findings can be interfered with

Relevance: Supports finality of arbitration in snag list disagreements unless gross error exists.

3. Ssangyong Engineering & Construction Co. Ltd. v National Highways Authority of India (2019 Supreme Court arbitration case)

Principle: Narrow scope of “public policy” after 2015 amendment.

• Reaffirms that courts cannot act as appellate bodies
• Interpretation of contract (including defect liability clauses) is arbitrator’s domain
• Only fundamental policy violations justify interference

Relevance: Employer/contractor disputes on snag lists generally decided finally by arbitrator.

4. Vidya Drolia v Durga Trading Corporation (2020 Supreme Court arbitration case)

Principle: Defines arbitrability and scope of disputes.

• Arbitration is valid for contractual and commercial disputes, including construction defects
• Courts should refer disputes to arbitration unless “non-arbitrable”
• Reinforces competence-competence principle

Relevance: Snagging list disputes are clearly arbitrable.

5. Duro Felguera SA v Gangavaram Port Ltd (2017 Supreme Court arbitration case)

Principle: Minimal court interference at referral stage.

• Courts must only check existence of arbitration agreement
• Detailed issues like defects, delays, and snag lists belong to arbitrator
• Emphasizes “hands-off” judicial approach

Relevance: Courts cannot refuse arbitration merely because snag list disputes are technical.

6. MSK Projects India (JV) Ltd v State of Rajasthan (2021 Supreme Court arbitration case)

Principle: Strengthens deference to arbitral findings in construction disputes.

• Court held that factual findings of arbitrator in infrastructure/construction matters should not be interfered with lightly
• Disputes on quality of work, measurement, and completion are factual issues

Relevance: Snagging list disputes (quality/defect findings) are factual and primarily for arbitrator.

5. Practical Arbitration Approach in Snagging List Disputes

A. Evidence commonly examined

• Joint inspection reports
• Engineer’s punch list/snag list
• Photographs/videos
• Completion certificate (or refusal)
• BOQ vs actual execution comparison

B. Key legal questions arbitrator decides

• Are snags “defects” or “minor rectifications”?
• Did contractor meet “substantial completion”?
• Can employer withhold retention money?
• Who bears rectification cost?

C. Outcome types

• Order for rectification at contractor cost
• Deduction from final bill
• Compensation for delay
• Partial acceptance with retention

6. Conclusion

Snagging list disputes are a classic construction arbitration issue involving technical evaluation rather than pure legal interpretation. Indian arbitration law strongly supports:

• Minimal court interference
• Finality of arbitral decisions
• Technical fact-finding by arbitrators

At the same time, courts ensure awards are not perverse, illegal, or contractually inconsistent, as reinforced through the above Supreme Court rulings.