How to Avoid and Resolve Disputes over Delays and Disruptions - 2
discussion among all affected parties of a very time-consuming
and expensive problem.
I. THE NATURE OF THE PROBLEM
Any number of events can readily conspire to delay a
construction project and/or erode the productivity of the craft
labor required to complete it. Such events include (but are far
from limited to) bad weather, differing site conditions, late
or incorrect designs, breakdowns in equipment, shortages
of qualified craft labor, problems with utilities, late or poor
decisions by the parties, delays in the delivery of critical
equipment or material, and of course, change orders. Such
events can increase the time required to reach a milestone or
complete the entire project. Even if these events do not impact
the schedule, they can still increase the number of craft labor
hours required to complete a particular task. Indeed, such
events can idle craft workers for significant periods of time,
or require an inefficient sequencing or re sequencing of the
work, or acceleration that translates into overtime, shift work
and perhaps a stacking of trades. Sometimes the contractor
bears the contractual responsibility for these events, and when
that is the case, the contractor may not be entitled to any
extension of the time or any additional compensation under
its contract. Other times, the owner bears that responsibility,
and when that is the case, the contractor may well be entitled
to additional time and/or compensation.
Experts have developed various
ways of calculating the impacts that
discrete events had or will have on
the schedule for the construction of
a project, or the productivity of the
This good news is that these basic principles are generally
well accepted. The bad news is that they can be and frequently
are difficult to apply. The parties can and often do find it challenging to determine and therefore agree on the specific cause
of a delay, or the responsibility for it, or how long it lasted. They
often find it even more challenging to determine the cause of
a disruption, its precise impact on productivity or the cost of
absorbing that impact. Making things even worse, the more
that events impact a project, and the greater their severity, the
harder it is to determine the discrete effect that any one event
had on the schedule and/or productivity.
Experts have developed various ways of calculating the impacts
that discrete events had or will have on the schedule for the construction of a project, or the productivity of the craft labor. The
methodologies are, however, complex and to greater and lesser
degrees, they are subject to manipulation. Some methodologies
are more objective and credible than others, but that fact is only
so helpful, for none of the methodologies will fit every situation.
In addition, the information available to the parties, and other
specifics of the situation, may limit the parties' options.
To make matters far worse, each one of these methodologies
is time-consuming and expensive to develop and to use. The
parties typically cannot do it themselves. Rather, they have
to engage and rely on experts in scheduling, damages and/or
productivity, and outside legal counsel. In addition, and all too
frequently, the parties cannot agree on the methodology that is
most appropriate to apply, or the experts to engage. Each party
goes its own way, requiring everything to be done at least twice,
and typically, in different ways. In an understandable effort to
please their respective clients, the experts and lawyers develop
equally reasonable but sharply conflicting theories of entitlement
and/or impact. The mediator, arbitrator and/or court is then left
with little or no help in determining what actually happened,
who was responsible or the resulting cost of the problem.
The process is cumbersome and expensive, and all too often,
the results are arbitrary. It consumes the parties' time and attention and still fails to yield anything approaching certainty. At the
end of the day, most would agree that there has to be a better way.
II. WHAT CONTRACTORS CAN DO ON THEIR OWN
Entirely on their own, construction contractors can begin to
mitigate the risk of a time-consuming and costly dispute over
a claim for delay or disruption. As they pursue work, and after
award but still prior to the start of work, they can unilaterally
implement policies, protocols and procedures that will increase
their chances of avoiding and/or quickly resolving such a dispute.
In conjunction with their clients, construction contractors can
also take several other steps. They can establish and clarify procedures for resolving disputes and requirements for notice and/
or recordkeeping, insofar as it relates to costs and quantities.
Contractors can also clarify whether and to what extent delays
and disruptions will be appropriate grounds for equitable adjustments. Best practice is to incorporate agreements on such matters
into the contract between the parties, but whether or not such
agreements find their way into the contract, the parties will still
find it helpful to pursue them.
Among the specific steps that construction contractors can take,
entirely on their own, are the following.
A.PRIOR TO CONTRACT AWARD
1. Identify the risks, if any, which are unique to the public or
private owner of the project.
* Past experience with a particular client is important to consider but organizations experience turnover, and as they do, both informal understandings and
express contracts' terms and conditions can all change.
2. Carefully review the bid or proposal, and any of the other
documents submitted in conjunction with it, including any
documents that identify or memorialized the assumptions that
went into the estimated schedule and cost.
* Those assumptions often lie in notes appended to the
Table of Contents for the Digital Edition of How to Avoid and Resolve Disputes over Delays and Disruptions
How to Avoid and Resolve Disputes over Delays and Disruptions - Intro
How to Avoid and Resolve Disputes over Delays and Disruptions - 1
How to Avoid and Resolve Disputes over Delays and Disruptions - 2
How to Avoid and Resolve Disputes over Delays and Disruptions - 3
How to Avoid and Resolve Disputes over Delays and Disruptions - 4
How to Avoid and Resolve Disputes over Delays and Disruptions - 5
How to Avoid and Resolve Disputes over Delays and Disruptions - 6
How to Avoid and Resolve Disputes over Delays and Disruptions - 7
How to Avoid and Resolve Disputes over Delays and Disruptions - 8
How to Avoid and Resolve Disputes over Delays and Disruptions - 9