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Topics: Change Management, Communications Management, Construction
Dispute on construction contracts
What are the major causes leading to dispute ? Please share your experience.
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I have found that it is when there are contradictions between contract documents. While often there is a hierarchy established for interpretation of the documents (i.e. which document holds precedence over others) that is often challenged by the contractor for good reason. I find that 'Notes' and 'Equipment Lists' found on drawings are often the cause of disputes as they conflict what is in the technical specifications. Often 'Notes' are added and Equipment Lists updated by the Engineer at the last minute to include project-specific requirements and to avoid rewriting 'outdated overused Technical Specifications. . As the Technical Specifications usually take precedence over the Drawings, the dispute arises when the contractor finds the requirements of the Technical Specifications to his/her advantage and provides 'as specified' whereas the Engineer/Client desires what is called out on the Drawings. A short-cut taken by the Engineer causes this conflict. The rule of thumb should be never place performance criteria on drawings; they belong in the specifications and that is usually where they are. Equipment lists belong in one document only. Having said criteria in both places will often cause conflict and lead to a dispute.
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1 reply by Chandrashekhar Thatte
Apr 04, 2017 6:40 AM
Chandrashekhar Thatte
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I completely endorse your observations on contradictions the "Notes and Equipment List"create when they fundamentally clash with contract provisions.The project specific requirement should be explicitly included in the Bid documents under technical specifications and item description or in the contract scope as the case may be depending on type of contract-Item rate/Design and Build/Lump-Sump contract.

Major causes leading to dispute,according to me,are 1) Failure to properly administer the contract 2) Poorly drafted or incomplete and unsubstantiated claim 3) Error and or Omission in the contract document 4) Incomplete design information or Employer requirement(For Design and Build contract)and 5) Employer/Contractor/Sub-contractor failing to understand and /or comply with its contractual obligations.
Not Delivering on time, lots of deficiencies at the end pf the project, bad performance.
1. Delay
2. Poor/substandard materials used
3. Off specification
4. Cost Overrun
Apr 01, 2017 9:03 AM
Replying to Daniel Petrowski
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I have found that it is when there are contradictions between contract documents. While often there is a hierarchy established for interpretation of the documents (i.e. which document holds precedence over others) that is often challenged by the contractor for good reason. I find that 'Notes' and 'Equipment Lists' found on drawings are often the cause of disputes as they conflict what is in the technical specifications. Often 'Notes' are added and Equipment Lists updated by the Engineer at the last minute to include project-specific requirements and to avoid rewriting 'outdated overused Technical Specifications. . As the Technical Specifications usually take precedence over the Drawings, the dispute arises when the contractor finds the requirements of the Technical Specifications to his/her advantage and provides 'as specified' whereas the Engineer/Client desires what is called out on the Drawings. A short-cut taken by the Engineer causes this conflict. The rule of thumb should be never place performance criteria on drawings; they belong in the specifications and that is usually where they are. Equipment lists belong in one document only. Having said criteria in both places will often cause conflict and lead to a dispute.
I completely endorse your observations on contradictions the "Notes and Equipment List"create when they fundamentally clash with contract provisions.The project specific requirement should be explicitly included in the Bid documents under technical specifications and item description or in the contract scope as the case may be depending on type of contract-Item rate/Design and Build/Lump-Sump contract.

Major causes leading to dispute,according to me,are 1) Failure to properly administer the contract 2) Poorly drafted or incomplete and unsubstantiated claim 3) Error and or Omission in the contract document 4) Incomplete design information or Employer requirement(For Design and Build contract)and 5) Employer/Contractor/Sub-contractor failing to understand and /or comply with its contractual obligations.

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