PaintSquare.com
Follow us on Twitter Follow us on LinkedIn Like us on Facebook Follow us on Instagram Visit the TPC Store
Search the site

 

Advertisement

Safway Services


Coatings Industry News

Main News Page


Assessing Project Disputes

Thursday, June 9, 2016

Comment | More

While the cost and time devoted to resolving construction disputes is rising in some parts of the world, the United States stands out as the only global region achieving a decrease in those expenditures—for the third year in a row, a new study says.

The report, “Global Construction Disputes Report 2016: Don’t Get Left Behind,” is the sixth annual study into worldwide construction disputes by Arcadis, a built asset design and consultancy firm.

“The North American industry has become more sophisticated in recent years, realizing what we have said for a long time—focusing on managing risk and early intervention will help reduce the number and cost of disputes,” said John Jastrem, chief executive officer of Arcadis North America.

project engineer
© iStock.com / aydinmutlu; all other images courtesy of Arcadis

A new study of construction disputes suggests the U.S. construction industry has become more sophisticated in its approach to managing risk and early intervention as an effective means to address overall risk.

Disputes relating to major construction projects in North America dropped in value to an average of $25 million in 2015, from $29.6 million seen in 2014.

The average length of time it took to resolve disputes decreased to 13.5 months in 2015 from 16.2 months the prior year, according to the study.

A Downside

“This trend is good news for the U.S. and Canada, but there is one downside,” warned Roy Cooper, vice president, Arcadis North America.

“Even though more disputes are being settled early, the ones that remain grow into complicated, emotional affairs, with large damages at stake. These also take longer to resolve, since U.S. courts hate to try construction cases due to their large volumes of documents and greater complexity.”

Around the Globe

Globally, construction disputes underway in 2015 averaged more than 15 months, up from 13.2 months in 2014, the report said.

The average value of the disputes in 2015 decreased to $46 million from $51 million in 2014.

Infographic

Research for the report was based on disputes Arcadis handled during 2015. Markets included in the report are North America, the U.K., Europe, the Middle East, and Asia.

Research for the report was conducted by Arcadis Construction Claims Consulting experts and based on disputes the team handled during 2015. Markets included in the report are North America, the U.K., Europe, the Middle East, and Asia.

The trends varied by region.

The Middle East saw an increase in value, overtaking Asia as the region with the highest valued disputes in 2015, with an average of $82 million. The UK, Asia, and Europe joined North America in a decrease in dispute costs.

Dispute

According to the data, more disputes rise up in the transportation, water and wastewater sectors for North American firms.

Globally, the property/building construction sector revealed the most disputes, closely followed by the social infrastructure/public sector. The natural resources sector, Arcadis noted, shows some of the largest disputes.

Top Five Causes

Globally, the most common cause of dispute is a failure to properly administer the contract. Poorly drafted or incomplete and unsubstantiated claims ranked second. Errors and/or omissions in the contract document came in third.

The fourth most common cause was incomplete design information or employer requirements. Rounding out the top five was the failing to understand and/or comply with contractual obligations on the part of the employer, contractor or subcontractor, according to the report.

top causes of disputes

The study found that joint ventures were found to be at particular risk, with 25.5 percent of JVs ending in dispute.

The report also found that party-to-party negotiation was the most common method of dispute resolution, followed by mediation and arbitration.

The full report is available here.

   

Tagged categories: Business matters; Construction; Contractors; Contracts; Design build; Disputes; Infrastructure; Market; Transportation; Trends; Wastewater Plants

Comment Join the Conversation:

Sign in to our community to add your comments.

Advertisements
 
Novatek Corporation
 
Dustless Coatings Removal
 
Novatek Corporation, Dustless Coatings Removal Strip, clean and profile all dust free! Comply with new lead standards. Contact today: (866) 563-7800 www.Novatekco.com
 

 
Industrial Vacuum Equipment Corp.
 
Hurricane Vacuums
& Dust Collectors
 
Vacuum and dust collector hose, filters and related accessories.
IndustrialVacuum.com
 

 
SAFE Systems, Inc.
 
SAFE Systems'
Blast Lights &
Deadman Switches
 
Halogen or LED blast lights available with our NEW urethane bumper. Switches available in many colors for color coding your hoses.
 

 
SABRE Autonomous Solutions
 
Imagine having an operator that takes less time to output more work
 
Once trained, a single operator can easily manage multiple SABRE systems.
 

 
Sauereisen, Inc.
 
Corrosion Resistant Materials for the Wastewater Industry
 
33+ years of successful installations

sauereisen.com
 

 
HoldTight Solutions Inc.
 
Clean surfaces simply don’t rust, and no other product cleans like HoldTight®102.
 
HoldTight®102 is a wet blasting additive that decreases the water’s surface tension, allowing it to get into the profile of the surface and remove ALL contamination, including salts, acids, abrasives, light oils, and greases. HoldTight®102 leaves behind no film and evaporates with the water, providing a surface that is thoroughly clean and ready for coating, rust-free for up to 72 hours.
 

 
SSPC: The Society for Protective Coatings
 
http://www.sspc.org/
 
Join SSPC and Enhance
Your Career !
 

 
Tarps manufacturing, Inc.
 
QUALITY MADE IN AMERICA —Available near you!
 
CLICK to get a behind-the-scenes look at how Tarps Manufacturing makes the highest-quality tarps right here in the USA — available nationwide.
 

 
Total Enclosure Sail System, Inc.
 
Environmental containment and weather protection system.
 
• The Sail System™ environmental containment and weather protection system is strong, durable, reusable, efficient and cost effective. Sail System™ provides class I containment for bridges, water towers, ground tanks, drydocks and more.
 

 
CHLOR*RID International Inc.
 
SOLUTIONS THAT WORK
 
Companies that invest in corrosion control use CHLOR RID products
  • Soluble salt removal liquid
  • Test kits to verify contamination levels
  • Surface passivation to hold the blast
INFO@CHLOR-RID.COM 800.422.3217
 

 
 
 

Technology Publishing Co., 1501 Reedsdale Street, Suite 2008, Pittsburgh, PA 15233

TEL 1-412-431-8300  • FAX  1-412-431-5428  •  EMAIL webmaster@paintsquare.com


The Technology Publishing Network

Durability + Design PaintSquare the Journal of Protective Coatings & Linings Paint BidTracker

 
EXPLORE:      JPCL   |   PaintSquare News   |   Interact   |   Buying Guides   |   Webinars   |   Resources   |   Classifieds
REGISTER AND SUBSCRIBE:      Free PaintSquare Registration   |   Subscribe to JPCL   |   Subscribe to PaintSquare News
MORE:      About PaintSquare.com   |   Privacy Policy   |   Terms & Conditions   |   Support   |   Site Map   |   Search   |   Contact Us