AN INVESTIGATION INTO THE EXTENT OF USE OF DISPUTE RESOLUTION TECHNIQUES IN CONSTRUCTION PROJECTS. A RESEARCH PROJECT MATERIAL ON QUANTITY AND SURVEYING
ABSTRACT
Construction projects are increasingly becoming complex, resulting in complex contract documents. Complex construction can likewise result in complex disputes. Disputes are inevitable in construction projects which predominantly arise from complexity and magnitude of works, multiple prime contracting parties, poorly prepared and/ or executed contract documents, inadequate planning, financial issues and communication problems. Depending on the nature of the relationship between the parties involved in the disputes and the circumstances under which the dispute is evolved, different methods of dispute resolution techniques may be preferable. The objective of this study is to identify the cause of dispute, to identify the existing practice of dispute resolution techniques in construction projects, to evaluate the prevailing dispute handling methods and recommend the most appropriate method. The method adopted for the study was through questionnaire survey where the target respondents were clients, consultants and contractors. Based on the analysed data, there are disputes caused by the clients, consultants and contractors which are capable of resulting to loss of reputation and sour relationship between the stakeholders and also loss of profit and business viability. Negotiation was observed as the most appropriate method of dispute resolution in construction projects in Nigeria as it non time consuming, cost effective and restores business relationship. From the findings it can be concluded that construction disputes are a cause of concern in every project and the solution to this problem is to avoid and cautiously manage them for smooth running of construction process.
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THE STUDY
Construction is plagued, perhaps more than any other industry, with disputes due to the inherent conflict of interest between the buyers of construction services (i.e. the owner or employer) and the sellers of the services (i.e. the contractor). The buyer wants to receive the most value for its construction finance whereas the seller wants to spend the least amount of money while meeting its contractual obligations. Unfortunately, these obligations are seldom, if ever, stated in clear enough language to preclude misunderstandings. Over the years, the industry has learned to rely on the design engineer or the architect, who formulates the construction documents, i.e. the most likely author of the misunderstanding, to clarify it and to decide on the corresponding responsibilities of the parties (Steve Revay, 1995).
Construction projects are among the most complicated of human enterprises. High levels of art and craft are required to translate an owner’s vision into plans and specifications, then into real structures, one that fits the needs of the individuals and the public. In addition to technical skills, the ability to coordinate the diverse efforts of many individuals is crucial to success.
The parties of a construction contract, the owner and contractor, are a society with a complex set of interrelated relationships requiring cooperation and collaboration to coordinate time, resources, and communication. The main goal of the parties involved in a project’s construction is to have a successful project. This is defined as a project that has been constructed in accordance with the plans and specifications, within the time and cost originally anticipated. The success of a project depends on a number of variables, not the least of which is how the organisations approach problems and conflicts (Diekmann et al. 1994)