CONSTRUCTION

DISPUTES
WHY DO CONSTRUCTION DISPUTES ARISE?

 Lack of understanding of the conditions of the

contract.
 Delays on a contract.
 Failure to administer the contract.
 Un_substantiated or incomplete claims being
made by the parties involved.
HOW TO REDUCE THE POSSIBILITY OF DISPUTES ARISING?

 Make significant upfront planning before

beginning work.
 Carefully read and understand the contract.
 Negotiate clauses that are murky or
potentially problematic.
 Be diligent when it comes to pre-construction work,
such as putting together estimates, schedules,
contacting subcontractors, making important orders,
etc.
 Make sure schedules are realistic and executable and
plan for delays and disruptions.
 Document any issues and challenges that arise during
the execution - daily reports are irreplaceable.
 .
 Deal with problems as they arise, do not
postpone them;
 Identify risks in advance and consult specialists;
and
 Adopt systems that increase predictability of
every process, and provide greater information
transparency to all parties
CONSTRUCTION DISPUTE RESOLUTION METHODS

1. Negotiation. A negotiation clause basically

includes the agreement that if a cause for a
dispute should arise between a contractor
and a project owner, these parties will
attempt to reach a just and satisfactory
resolution between themselves before
moving on to other means.
 2. Mediation. A mediation clause suggests the
inclusion of a neutral third party in the dispute
situation to help mediate the process of
resolving the dispute. Mediation is not legally
binding in any way, but can be an effective way
out of a situation which could otherwise
deteriorate.
 3. Expert determination. An alternative to
mediation is expert determination which is used
to resolve disputes of a specialist nature or in
cases where there is a valuation dispute
requiring a specialist's opinion. Though the
determination cannot be legally enforced either,
if the parties agree to this type of resolution it
may save them from more time-consuming
procedures.
 4. Adjudication. The adjudication method also
includes a neutral third party but unlike with the
mediation method, the adjudicator will give a
decision, whereas the mediator will assist parties
in finding the resolution. Adjudication clauses
typically also include the possibility of applying to
a court to enforce the adjudicator's decision, if the
dispute is not resolved by the decision itself. It is a
cost-efficient method which helps operations
proceed while the dispute is resolved.
 5. Arbitration. If parties decide to go for arbitration,
they will again have a neutral third party enter the
situation to help resolve it. In arbitration parties agree
to the arbitrator who has the relevant experience to
engage in the matter. The arbitrator considers
documents and facts that concern the situation, and can
make a decision that favors one side if the parties fail to
achieve consensus. Arbitrations can be legally binding,
depending on the jurisdiction. The costs of arbitration
can be significantly higher than that of other methods,
sometimes even as high as legal proceedings.
 6. Litigation. Finally, litigation is usually also
included in the dispute clause, in case the parties
do not find any other way to resolve the issues
that have come up. Litigation involves a trial and is
legally binding and enforceable, though it can also
be appealed. Litigation can be by far the most
thorough, complex as well as slow and costly way
of resolving a dispute. This is why parties will
typically attempt a number of other resolution
methods before opting for litigation.
Mediators Ethics

I. A MEDIATOR SHOULD ENSURE THAT ALL PARTIES ARE INFORMED ABOUT THE
MEDIATOR'S ROLE AND NATURE OF THE MEDIATION PROCESS, AND THAT ALL PARTIES
UNDERSTAND THE TERMS OF SETTLEMENT. 

II. A MEDIATOR SHOULD PROTECT THE VOLUNTARY PARTICIPATION OF EACH PARTY. 

III. A MEDIATOR SHOULD BE COMPETENT TO MEDIATE THE PARTICULAR MATTER.

IV. A MEDIATOR SHOULD MAINTAIN THE CONFIDENTIALITY OF THE PROCESS. 

V. A MEDIATOR SHOULD CONDUCT THE PROCESS IMPARTIALLY. 

VI. A MEDIATOR SHOULD REFRAIN FROM PROVIDING LEGAL ADVICE. 

Mediators Ethics

VII. A MEDIATOR SHOULD WITHDRAW UNDER CERTAIN CIRCUMSTANCES

VIII. A MEDIATOR SHOULD AVOID MARKETING THAT IS MISLEADING AND SHOULD NOT
GUARANTEE RESULTS
Arbitrators Ethics

I. AN ARBITRATOR SHOULD UPHOLD THE DIGNITY AND INTEGRITY OF

THE OFFICE OF THE ARBITRATION PROCESS.
II. AN ARBITRATOR SHOULD BE COMPETENT TO ARBITRATE THE
PARTICULAR MATTER.
III. AN ARBITRATOR SHOULD INFORM ALL PARTIES OF THE ROLE OF THE
ARBITRATOR AND THE RULES OF THE ARBITRATION PROCESS.
IV. AN ARBITRATOR SHOULD MAINTAIN CONFIDENTIALITY APPROPRIATE
TO THE PROCESS.
V. AN ARBITRATOR SHOULD ENSURE THAT HE OR SHE HAS NO KNOW
CONFLICT OF INTEREST REGARDING THE CASE, AND SHOULD ENDEAVOR
TO AVOID ANY APPEARANCE OF A CONFLICT OF INTEREST.
Arbitrators Ethics

VI. AN ARBITRATOR SHOULD ENDEAVOR TO PROVIDE AN EVENHANDED

AND UNBIASED PROCESS AND TO TREAT ALL PARTIES WITH RESPECT AT
ALL STAGES OF THE PROCEEDINGS.
VII. AN ARBITRATOR SHOULD WITHDRAW UNDER CERTAIN
CIRCUMSTANCES
VIII. AN ARBITRATOR SHOULD MAKE DECISIONS IN A JUST,
INDEPENDENT AND DELIBERATE MANNER.
IX. AN ARBITRATOR SHOULD UPHOLD THE DIGNITY AND INTEGRITY OF
THE ARBITRATION PROCESS IN MATTERS RELATING TO MARKETING
AND COMPENSATION