How to prevent conflicts between contractors project owners
Oct 06, 2010
DURING the course of projects, disputes between contractors and project owners often happen. The disputes may sometimes linger on long after the construction has been completed.
By Aidah Nanyonjo
DURING the course of projects, disputes between contractors and project owners often happen. The disputes may sometimes linger on long after the construction has been completed.
According to Joseph Kitagenda of Alpha and Omega Contractors, disputes typically start with a problem and develop into differences of opinion. This can escalate to disagreements and conflicts that require legal action.
He said disputes can also arise over schedule targets, performance guarantees or deviations from the original contract terms. In some cases, disputes are caused by the nature of the project. Handling a construction project from planning through design, construction and occupancy involves a lot of stakeholders.
These include architects, engineers, general contractors, subcontractors, suppliers, financing institutions, legal representatives and the project owners, who may be individuals, corporations or government entities. The stakeholders bring varying, and sometimes conflicting expectations to a project.
It is important to identify problems that result from change of orders and claims for additional work over the original contract scope.
These change of orders and claims usually create confusion, problems and delays, leading to an adversarial environment.
Kitagenda says the above problems can be prevented by identifying the causes of the conflict. This helps resolve the disputes during the construction process in order to avoid post-construction claims, litigation and related costs.
Since problems and potential disputes can occur in many different ways and at different times during a construction relationship, Kitagenda notes that no single dispute resolution mechanism can work for all the disputes.
“Numerous techniques and approaches can be used for preventing, controlling, and resolving disputes that can be tailored to specific situations,†he said.
Using numerous techniques helps in early resolution of disputes, transparent procedures, an environment of understanding and cooperation and limited posturing by the various parties; fewer issues and claims; and reduced costs.
Kitagenda emphasises that effective dispute prevention begins early, during project planning. This helps to resolve disputes quickly and informally.
“Get technical input if necessary, keep the job moving and avoid the court system.
“It is incumbent on the project owner and the contractor to acknowledge that problems and disputes will occur or are most likely to occur.â€
From there, owners can design a system of techniques, controls, filters and devices that will ensure prompt and realistic resolution of disputes before they grow into serious problems.
During the planning phase, owners can select a contracting strategy for equitably allocating risk and identifying financial incentives so that owner and contractor objectives are aligned.
The owner can also identify techniques to be used throughout the project delivery process to enhance communication, such as integrated project teams, partnering, dispute review boards and employing a project counsel.
Kitagenda added that a clear understanding of the scope of work, the labour environment, material availability and other factors affecting the project prior to the bidding can also help avoid or minimise conflicts. It is important to understand site conditions, early or, if the conditions are uncertain to put in place contract provisions to address them.
hat acknowledge and equitably allocate the risk associated with site.
DURING the course of projects, disputes between contractors and project owners often happen. The disputes may sometimes linger on long after the construction has been completed.
According to Joseph Kitagenda of Alpha and Omega Contractors, disputes typically start with a problem and develop into differences of opinion. This can escalate to disagreements and conflicts that require legal action.
He said disputes can also arise over schedule targets, performance guarantees or deviations from the original contract terms. In some cases, disputes are caused by the nature of the project. Handling a construction project from planning through design, construction and occupancy involves a lot of stakeholders.
These include architects, engineers, general contractors, subcontractors, suppliers, financing institutions, legal representatives and the project owners, who may be individuals, corporations or government entities. The stakeholders bring varying, and sometimes conflicting expectations to a project.
It is important to identify problems that result from change of orders and claims for additional work over the original contract scope.
These change of orders and claims usually create confusion, problems and delays, leading to an adversarial environment.
Kitagenda says the above problems can be prevented by identifying the causes of the conflict. This helps resolve the disputes during the construction process in order to avoid post-construction claims, litigation and related costs.
Since problems and potential disputes can occur in many different ways and at different times during a construction relationship, Kitagenda notes that no single dispute resolution mechanism can work for all the disputes.
“Numerous techniques and approaches can be used for preventing, controlling, and resolving disputes that can be tailored to specific situations,†he said.
Using numerous techniques helps in early resolution of disputes, transparent procedures, an environment of understanding and cooperation and limited posturing by the various parties; fewer issues and claims; and reduced costs.
Kitagenda emphasises that effective dispute prevention begins early, during project planning. This helps to resolve disputes quickly and informally.
“Get technical input if necessary, keep the job moving and avoid the court system.
“It is incumbent on the project owner and the contractor to acknowledge that problems and disputes will occur or are most likely to occur.â€
From there, owners can design a system of techniques, controls, filters and devices that will ensure prompt and realistic resolution of disputes before they grow into serious problems.
During the planning phase, owners can select a contracting strategy for equitably allocating risk and identifying financial incentives so that owner and contractor objectives are aligned.
The owner can also identify techniques to be used throughout the project delivery process to enhance communication, such as integrated project teams, partnering, dispute review boards and employing a project counsel.
Kitagenda added that a clear understanding of the scope of work, the labour environment, material availability and other factors affecting the project prior to the bidding can also help avoid or minimise conflicts. It is important to understand site conditions, early or, if the conditions are uncertain to put in place contract provisions to address them.
hat acknowledge and equitably allocate the risk associated with site.