No matter the size of the construction project, issues and challenges could occur. Whether it is a delay, defects in design or materials, changes in conditions, issues with payments or other similar issues, many of these problems can turn into very complex and challenging issues that could compromise the entire project. Because of that, project owners, contractors, sub-contractors, design professionals, equipment suppliers and construction lenders should understand their rights when a construction dispute or problem arises.
After noting the recent trend of decreasing costs associated with construction disputes in 2015, a recent study considered the five most common construction disputes during the fiscal year of 2014. The number one cause for construction disputes in 2014 was errors or omissions in the contract, while the number two slot was differing site conditions.
The third most common construction dispute in 2014 was caused by an employer, contractor or sub-contractor failing to understand, or not complying with, the obligations outlined by the contract. The fourth most common was the failure to properly administer the contract. Finally, the fifth most common construction dispute was caused by poorly drafted, incomplete or unsubstantiated claims.
While it was noted that the costs associated with construction legal disputes have gone down, the average time it takes to resolve these disputes has increased. According to this study, it takes an average of 16 months to go through the construction litigation process. This is why parties to such disputes should be well informed of the process and the options available to them.
Construction disputes could delay a project, causing many costs to those involved. Additionally, the construction litigation process could be lengthy and complex. Numerous parties could be involved and there could be several issues regarding multiple contracts. Because of this, those dealing with construction disputes should understand how he or she could resolve construction issues.
Source: Nreionline.com, “5 Most Common Causes of Construction Disputes,” Elaine Misonzhnik, June 29, 2015