Construction Disputes Flashcards
(51 cards)
Disagreements between the parties involved in a contract
Most commonly arise in an owner and a contractor
relationship, but can also emerge from suppliers,
construction subcontractors, real estate developers, and
architects.
Are not a breach of contract, but they may lead to a breach of
contract, termination, or even claims threatening the
contractor’s surety bonds if unmitigated.
Construction Dispute
Major Flash Points in Construction
Disputes
scope changes/change
delays and schedule issues
payment problems
Quality of Work /Defective Work
Design Errors /Omissions
Contract interpretation
Site Conditions (Differing or Unforeseen)
Health, Safety, and Environmental Issues
termination or suspension
Refers to a process through which two parties can
come together and build a consensus to end the
conflict.
It can take many forms, such as negotiation,
mediation, or arbitration
Dispute resolution
_____________is a term used to describe Dispute
resolution methods that do not involve going to court
. Alternative dispute resolution
(ADR processes)
most informal method of dispute resolution. It involves
direct discussions between the parties to reach a mutually
acceptable agreement. This method is often the first step in
resolving conflicts and is preferred for its simplicity and cost
effectiveness
Negotiation
involves a neutral third party, known as a mediator, who
facilitates discussions between the parties to help them
reach a resolution. The mediator does not impose a decision
but assists the parties in finding common ground. _________
is a collaborative approach and is effective for preserving
relationships.
Mediation
more formal method where a neutral arbitrator or panel
makes a binding decision on the dispute. The _______
process is less formal than court litigation but provides a
definitive resolution. _________ is often used for more
complex disputes and is governed by specific rules and
procedures.
Arbitration
involves a neutral adjudicator who makes a decision based
on the evidence presented. The adjudicator’s decision is
usually binding and is intended to provide a quick resolution
to disputes. ____________ is commonly used in construction
contracts and is designed to address issues promptly
Adjudication
the process of resolving disputes through the court system.
This method is formal and involves presenting the case
before a judge or jury. __________ is typically used for
significant disputes where other methods have failed. While
it can provide a definitive resolution, it is often time
consuming and expensive.
Litigation
In this, the company defines the duties and obligations of the
employer and employee.
The goal behind it is to
Maintain discipline
Avoid arbitration
Improve coordination
Aware of each other’s duties and responsibilities
Code of the Discipline
A pre-defined procedure is specified in the labour
contracts to be followed in case of any grievance.
Disputes can be resolved with ease by following this
procedure strictly
Grievance Procedure
An official document that outlines
modifications or adjustments to a project’s
original scope of work.
_____________- can cover various aspects,
including changes in design specifications,
materials, quantities, timelines, or any
other contractual terms.
Variation orders
Importance of Variation Orders
Ensure Clarity and Keep Records
Contractual Compliance
Change Control
Cost and Time Management
Modifications to the original design or specifications
Design Changes
Discovering unforeseen challenges or site conditions during
construction.
Unforeseen
Conditions
Alterations requested by the client due to evolving needs or
preferences.
Client
Requirement
Changes
Adding additional work beyond the original contract scope
Scope Expansion
Modifications to the project timeline or sequencing of activities
Schedule
Adjustments
Replacing specified materials with alternatives.
Material
Substitutions
Conduct comprehensive
project planning, including
development of detailed
design, site condition
investigations, accurate cost
estimation, and thorough risk
assessment.
Thorough Project
Planning
Ensure contracts clearly
define the scope of work,
specifications, timelines,
and change management
procedures. A matrix of
responsibilities might be
helpful
Clear and Comprehensive
Contracts
Foster open and transparent
communication among all
project participants, including
clients, contractors, and
subcontractors.
Effective Communication
Maintain meticulous
documentation
throughout the project
lifecycle, including
meeting minutes, change
orders, and relevant
correspondence.
Detailed Documentation
Implement a robust
project monitoring system
(such as early warning
notices – click here to read
our article on it), including
regular site inspections
and progress meetings, to
track progress and identify
potential issues that might
lead to variations
Regular Project
Monitoring
