CICES focus on collaborative management of contract disputes
THE industry and our members generate significant volumes of data from which it is able to produce information and inform current and future decisions. Having done all of this good stuff, in that order, and the level of innovation and technology available to us – that we often take for granted – project teams will get along and have limited disputes.
The recent CICES commercial management conference featured a collection of industry knowledge and expertise to try and propose that the industry can – and must – collaborate in resolving its disputes. The conference took place in the context of many high-pro file projects that only serve to highlight that the industry is still failing to collaborate in effectively allocating contract risk, managing change, performing individual obligations, and relationships within the project delivery environment.
A completed by Fenwick Elliot and Pump Court into the 2022 Construction Adjudication in the UK1 highlighted the leading causes of disputes. In this study, the respondents were asked to select multiple answers of the main causes:
- Inadequate contract administration (49%).
- Changes by the client (46%).
- Exaggerated claims (43%).
- Lack of competence of project participants (41%).
- Adversarial (industry) culture (28%).
- Unclear risk allocation (24%).
- Inadequate contract/design documentation (representing 23% and 22% respectively).
It is clear to me that if the industry can find ways to collaborate, a significant proportion of costly disputes can be avoided. My presidential theme has sought to shine a light on the need to add value through collaboration.
Having done all of this good stuff, in that order, and the level of innovation and technology available to us – that we often take for granted – project teams will get along and have limited disputes.
Conference participants, Jim McCluskey (CICES Commercial Management Practices Committee chair and Kier Nuclear), Shy Jackson (BCLP LLP), and Mark Wheeler (Diales), focused on this theme to see if the collaboration idea can be applied to the thorny issue of dispute resolution.
I contributed my thoughts by emphasising that equity in contract risk allocation and management, supported by competent and timely performance of obligations, is key to avoiding disputes.
My key takeaways amongst many dispute avoidance lessons from the conference were:
- Support the conflict avoidance process by signing the Conflict Avoidance Pledge, the purpose of which is to drive behavioural change in the way relationships and disputes are managed throughout the construction industry.
- Consider the use of a ‘project neutral’ approach to avoid and resolving disputes.
- Explore if expert witnesses can be involved early to avoid and resolve disputes.
- The Institute for Collaborative Working provides some useful processes of preventative collaborative dispute resolution.
- We must also consider what behaviours can be employed to resolve sticky, expensive, and annoying disputes.
- Advocate for the use of technology to record what has been done, how it was done, when it was done, and under what conditions was it done and by who. In other words, let’s find a way of digitising contract records and adapt our contracts to recognise these records forms.
Batsetswe Motsumi FCInstCES, President
1 2022 Construction Adjudication in the United Kingdom: tracing trends and guiding reform dated 12 January 2023