The construction industry by its nature is subject to disputes and costly claims activity. The complexities of construction documents, the numerous field activities, variations in design, unexpected field conditions and many other factors, often in combination, impede theresolution of claims issues.
Quite commonly, the potential for disputes is originated during the pre-construction period because of ambiguities, conflicts, errors or omissions in the construction documents.During the construction period resolution of small claimsare frequently ignored or postponed only to collect and combine into complex issues at the end of the project. As time elapses memories become obscure and people move, further clouding the issues. The incidents or conditions which give rise to claims generally fall into two categories or a combination of the two - delays and damages. Delays usually result in associated damages while damages alone can be the result of other causes.
Delays are associated with most construction claims and deserve considerable attention and appropriate expertise to determine the cause, responsibility, impact and magnitude. The identification and analysis of technical delay issues requires a professional with substantial construction and critical path method scheduling experience. Using Primavera P3 CPM Scheduling Programs, the effect of delay upon a chain of events can be analyzed and graphically displayed. In addition to time calculations, this method accommodates the distribution of man-hours and / or dollars to calculate appropriate damages, particularly when they are a result of escalation. Delays occurring at the same time but caused by different parties (usually termed "concurrent delays") are generally more difficult to resolve than delays caused by a single party. CPM techniques are very useful for this analysis. Although most construction claims are time related, there are some which are caused by momentary impacts alone, such as, changes in quantities, changed conditions, unit cost disputes and mishandled change orders.
A claims avoidance program can be implemented to minimize costly disputes, potential contract default, and litigation. To avoid these pitfalls the time to initiate a claims avoidance program is prior to advertisement for contractor bids. It should continue for the duration of the project, and should include the following elements:
A review
of construction documents for completeness, ambiguities, conflicts and
legal correctness;
The
development of field procedures and a document control system with particular
emphasis on change order management;
The
definition and implementation of adequate scheduling procedures. This
should include recording as-built information as well as maintaining
an as-planned schedule;
The
establishment of a system for analyzing, negotiating and resolving claims
expeditiously; and
The
education of field personnel to recognize and report potential claims
situations before formal disputes develop. Emphasis should be placed
on comprehensive documentation of conditions leading to potential real
claims.
Reviewing
the contract (for construction not legal content), specifications and
drawings prior to the advertisement for contractor bids;
Providing
periodic project overview during the construction period to implement
a cost effective claims management system;
Performing
objective analyses, research, appraisals and document preparation in
support of or in mitigation of claims;
Generating
expert reports including narrative analysis, delay analyses, damage
calculations, graphics and other visual ffpresentation
materials;
Assisting
in the surety during a default and subsequent assessment, and project
takeover; and
Providing
expert witnesses for legal hearings.
