Completing a construction project on time, according to specifications, often depends on a variety of factors. In some cases, delays may be out of a contractor’s control. Yet, disputes continue to increase throughout the industry.
Statistics suggest construction disputes increased in complexity during 2019. With an average value of $18.8 million, the industry experienced the highest disputed dollar amounts in North American history. Additionally, it took more than a year and a half, on average, for the involved parties in each case to reach a resolution. So, why are problems becoming more prevalent?
Disputes correlate to industry trends
The larger the project, the greater the potential for claims. As such, the costs associated with megaprojects related to healthcare, education and real estate development likely contributed to the increase in legal action.
Errors in contracted terms and mistakes in contracted work were the top two reasons for construction disputes last year. The three-way tie for the third cause included:
- Unrealistic completion dates
- Owner-requested changes to the project
- Unsubstantiated or incomplete claims
It would seem as though an unwillingness to collaborate, relational challenges or biased opinions represent a detrimental interpersonal influence on lengthy, costly claims.
Meanwhile, shutdowns already delayed multiple projects this year. While it may be too soon to predict how the pandemic will affect legal action surrounding construction in the upcoming months, increased transparency and a willingness to compromise may be vital to redefining the successful completion of a project.