Change in Projects’ Scope the Leading Cause of Construction Disputes

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Robison Wells
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International consulting group HKA, in its report “CRUX Insight: A Global Sector Market Analysis”, the group found changes to the scope of a project was the most common cause of construction disputes. This looked at many sectors, including commercial, defense, aerospace and military, industrial, infrastructure, oil and gas, and power and utilities.

The report analyzed 700 projects with a combined cost of more than a trillion dollars in value. The cause of the disputes seems to be because design aspects of a project are being farmed out to contractors and subcontractors more often. The report also found that these firms do not appear to be learning from their mistakes and have not changed the business practices that have gotten them in hot water in the past. While there is a suggestion that digitization is the solution to the problem, increasing the quality of communication, technology continues to run into human error and increasing complexity.

The technology that is most helpful in avoiding disputes is scheduling software and 3D modeling software such as BIM and data collection. All of these tools seem to help keep contractors, managers and stakeholders on the same page in relation to potential trouble spots.

Also, if the disputes turn into court cases, construction companies have found that these technologies are extremely beneficial in defending themselves against lawsuits.

For commercial construction, the most common contributors to disputes were poorly drafted contract requirements, late design information, failure of either the management or administration process, poor subcontractor or supplier management, low level of skill or expertise, incomplete or incorrect designs, cash flow issues, and false claims.

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