The Main Causes Of Construction Disputes And How To Avoid Them

Millennial Magazine - construction disputes

Construction can be considered as a form of development in the city or town where it’s taking place. However, a number of people might disagree, leading to difficult issues and misunderstanding. A civil word for it is a dispute. Construction disputes are a common occurrence in the construction industry.

They can come about for many different reasons, including disagreements over contract terms or lack of communication between parties. This article will explore what causes these types of problems and how to avoid them, as well as discuss legal remedies available if necessary.

What are Construction Disputes?

A construction dispute occurs when one or more parties are in disagreement with each other about one or more issues associated with the project. These types of disputes are common, but it is important to identify the main causes. To avoid them, you’ll need to try and communicate clearly with each other about any issues that might arise.

Types Of Disputes

There are many causes of construction disputes, including:

  • Administration/Project Management − Where there has been poor administration in relation to payments or schedule management;
  • Contractual − Where there has been a disagreement over the terms of the construction contract;
  • Site Conditions − Where problems have arisen on site e.g. safety hazards, difficult ground conditions, etc.;
  • Design/Technical − Disputes arising from design issues or technical problems;
  • Construction Methodology – A lack of understanding leading to unexpected costs; and
  • Construction Delays − A disagreement with regards to delays and timekeeping.

How To Avoid Construction Disputes

Construction disputes can prove extremely costly for both sides, resulting in delays to the completion of the project, damage to the company’s reputations, and massive amounts of wasted time. In order to avoid this happening it is important that you do everything within your power to communicate with your client throughout the entire process. To do this, you should set out all of your terms and conditions in the contract, using clear language. If there is anything that your client is unclear about, make sure to address this before moving forward.

It is also important that you and your client take regular and effective communication about any changes to their requirements for the project. However, if a dispute does arise, then it will be necessary to contact a lawyer to help you out. A construction lawyer in Brisbane noted that in some cases, your client may be breaching a term in the contract, while in other cases they may not have paid their final invoice for the project. Disputes can also arise from a lack of clear expectations on either side about what is expected from the other party.

If there have been no meetings between the client and the contractor to discuss how the project should proceed, then there is a risk that misunderstandings will arise later down the line. Your client may not understand what you are capable of achieving, or they could have different ideas about what sort of materials should be used, for example. Therefore, it is important to meet with your client regularly so that you can understand exactly what they are expecting from you.

When creating the contract, it is important not to leave anything out. There should be an outline of the work, bill rates, milestones for different stages of the project, and payment schedules. Make sure that your terms clearly state what will happen if either party fails to perform their side of the deal. Also, you should ensure that your contract clearly states what legal remedies are available if either party breaches the contract or fails to perform certain parts of it.

Causes of Construction Disputes

Construction disputes are extremely common and can cause significant commercial problems for construction companies. In order to avoid them, it is crucial to understand the causes of these issues. There are a number of different causes for this type of problem, but the two most relevant ones are discussed below.

The first main cause of construction disputes is a lack of communication between parties involved in the project. Many issues which lead to major problems arise due to a failure to communicate fully and effectively throughout the life cycle of a project. If one party fails, for example, to update another on key milestones, then those parties may unwittingly fall out of step with each other. This can lead to problems such as:

  • Delays and changes to the program
  • Reduced efficiency and productivity
  • Increased costs and reduced profitability

These issues arise due to a lack of communication; ensuring clear lines of communication between all relevant parties during the lifetime of a project is crucial for construction companies.

A second common cause of construction disputes is a disagreement between parties over the terms of the contract. If either party has a different understanding of what was agreed during contract negotiations, then there will be a strong possibility that they will be able to point to the part of the written document which substantiates their interpretation. This can lead to disputes which can be very difficult to resolve. In order to avoid this problem, it is crucial that all parties have a thorough understanding of the key elements of the contract and their rights and liabilities under them.

Legal Remedies Available

The majority of construction contracts include a dispute resolution clause, giving either party the right to begin legal proceedings to resolve any discrepancies. Legal remedies available can include:

  • Interim/Preliminary/Temporary Relief – This can be obtained where one party needs urgent relief, e.g. an application for an injunction;
  • Specific Performance – The Courts can order that performance of the contract is carried out to the required standard;
  • Damages − Money awarded by the Courts as compensation (depending on loss); and
  • Declaratory Relief – A judgment is made by the Court to resolve any disputes in relation to the interpretation of the contract.

However, legal remedies are not always possible. It’s important that you understand your contractual terms and what the consequences might be if they are breached.

Construction disputes can often be caused by a number of issues, but it’s important to try and communicate with the other party where possible. If this isn’t done, an issue can escalate, leading to costly legal proceedings. Therefore, it’s vital to understand the terms of your contract, so you know what remedies are available if necessary.

What do you think?

Written by Adam Mitchell

But a mere mortal traversing through this journey spewing poetic verve. Part tech enthusiast. Part economist. Part scribe.

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