Disputes are unfortunately a common feature in construction projects. Many studies have been done in the industry to understand their possible causes. The reality of construction projects is that there are usually a variety of stakeholders involved. They each have different (and competing) work disciplines and different interests, often making conflicts between the parties inevitable. Understanding the causes of disputes is one step that construction professionals can take in order to implement proactive measures to avoid (or at least minimise) disputes at each stage of the project.
We have had a look at the research and have compiled what we believe are the top 6 causes of conflict or dispute in construction projects.
Construction contracts will typically contain clauses that allow a party to vary the contract without altering the spirit and purpose of the contract. Usually, a variation is the process of changing the quality, quantity (cost) or schedule of work. Variations can be caused by a change in scope, differing site conditions, delays, suspensions, and acceleration.
Disputes will usually arise when there are:
There are many internal and external factors that contribute to a dispute caused due to delays by a contractor.
The major ones include:
* Project float is how much extra time or flexibility is calculated into the project schedule that allows the project to absorb a delay without causing a delay to the overall completion date
Design and planning are important processes in a construction project because of the potential to cause a significant negative impact on the overall construction if not done effectively.
If errors and ambiguities in design are not rectified during the design phase, they eventually appear in a construction phase. One example of such an error would be the reporting of incorrect soil class, which is vital information for civil contractors to factor into the bulk earthworks.
Disputes frequently occur for reasons such as:
Engineering and design consultants are normally the party responsible for errors and ambiguities in design and planning. It is therefore imperative for the party responsible for the design to acknowledge their major role in solving design problems before the construction phase starts and ensure that the changes are properly communicated amongst all the project stakeholders.
Clients themselves can be a major cause of disputes in construction projects when they prevent progress of the works.
Some of the reasons that would cause this type of dispute to arise include:
This is a type of “people” dispute in construction projects. Unrealistic expectations by the customer (or engineering consultant) arise in construction projects in situations where:
In recent times, it is common for the head contract to state that the construction contractor is required to progress at their own risk regardless of engineering review or approval of drawings. If the engineering review or approval of a drawing is late or inadequate, this can breed disputes between the parties involved.
Some of the reasons this dispute arises is due to:
Wambeti Legal can assist you with avoiding and managing (and minimising) disputes by:
This article is of a general nature and should not be relied upon as legal advice. If you require further information, advice or assistance for your specific circumstances, please contact Wambeti Legal.
Flora Wambeti has joined Laity Morrow.
Please contact Flora at Laity Morrow.
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