Tawfikweek 4COLLAPSE To best reduce the potential for disputes in construction projects, it is key to make sure the project contract is exceptionally clear and as detailed as possible. Each party...

To best reduce the potential for disputes in construction projects, it is key to make sure the project contract is exceptionally clear and as detailed as possible. Each party needs to understand their expectations and obligations contractually prior to the start of construction, so there are no discrepancies on that in the future. In order to execute this, it is important for contracts to have clear and detailed liquidated damages and acceptable delays clauses, as we discussed last week, as well as detailed performance and payment bonds. These clauses and bonds will make sure that all parties involved understand their obligations, responsibilities, and what they expect from the other parties involved. However, if a dispute does arise, it is important to be able to pull the contract and the bonds attached in order to reduce the claim as smoothly as possible. Usually, shared risk contract disputes are settled easier than not shared risk contract disputes because, in theory, all parties involved are aware of their risks prior to construction.

The National Academies of Sciences Engineering Medicine. (2007). Reducing Construction Costs: Uses of Best Dispute Resolution Practices by Project Owners [Scholarly project]. In The National Academies Press. Retrieved from https://www.nap.edu/read/11846/chapter/9