Construction Contracts: An Evaluation of Alternative Dispute Resolution Routes and Design and Build Strategy

CONSTRUCTION CONTRACTS
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1. Introduction
The construction industry has been characterized by disputes that have become a
widespread problem. Over the past few decades, the main approach to solving construction
disputes has been through the litigation process. Even though it has been helpful, litigation has
been associated with delays, adversarial relationships, and attendant costs. Also, some parties in
the construction contracts seem to be aggressive and simple mistakes have the capacity of a
fomenting conflict. The observations of simple matters causing huge conflict were first stated in
the case of (McAlpine Humberoak Ltd v McDermott International Inc, 1992) where the judge
said that through a hyperbole that there was a tendency in constructions where a party would
prepare for a suit whenever in dried from the contract document.
Alternative Dispute Resolution (ADR) is an old practice in common law traditions. Its
origin can be traced from the English legal developments during the time of Norman Conquest
(Rabban, 2013). The English citizenry was instituting actions against private wrongs, and the
process was presided by highly esteemed men a community at informal levels. At higher levels,
the king was also utilizing the respected men and would adopt their decisions in the highest
authoritative judgments. ADR is currently employed as a convenient method of dispute
resolution that focuses on saving time and restoring the original relationship of the parties. The
modern life is changing rapidly involving complexities with some issues appearing in law at their
first time (Bailey, 2011). For instance, collaboration in the web is a new development where
construction officials can collaborate on an effective project delivery. When such new
developments appearing in court at their first time, their complexity becomes a burden to the
legal systems where formality prevails. And since the law has never dealt with such an issue
before, the legal system becomes inadequate in its efficacy in solving that issue which then

causes delays as the legal system consults the best way to include such matters into its
formalities.
On the other hand, for ADR uses fewer formalities and involves different innovative
mechanisms that suit each scenario. Unlike litigation where parties are compelled to participate,
the fewer formalities of ADR give room to voluntary participation, neutrality, collaboration,
privacy, speed, less costs, flexibility, and the preservation and repair of the business relationships
(Dragos & Neamtu, 2014). The most common methods of dispute resolution in construction
projects are the mediation, adjudication, and arbitration.
2. Evaluation of alternative dispute resolution routes the contractors can take
The basic reason why disputes in constructions occur is the interaction between the key
individuals that happen in some way and opinion differs both at technical and legal level.
Disputes start with conflicts due to incompatible objectives. The altercations of these conflicts
make some individuals become intransigent especially when the main source of the argument
lies within justiciable rights (Bailey, 2011). While construction disputes are sometimes
inevitable, approaches to the resolutions are can contribute to either escalation or solution of the
disputes (Yaskova & Zaitseva, 2017). Below are the major ADR methods that contractors can
take.
2.1 Negotiation
Negotiation simplest ADR route. It is a voluntary method where the involved parties
meet and talk the matter among themselves as the first attempt at resolving the differences. The
process does not involve a third party, and it can solve either matter of the construction and
preferably matters that may require the variation of a contract (Dragos & Neamtu, 2014).

Negotiation is simple, can happen anytime and anywhere, less costly, very informal, quick,
confidential and private.
2.2 Conciliation
Unlike negotiation, conciliation involves a third party who is a neutral person. The role of
the neutral person is to listen to the disputing parties separately, take their points, and then
explain the points to each of those parties (Bailey, 2011). Basically, it is just clarifying the views
of each party to the other. The neutral person helps the parties to reach a solution by encouraging
them to understand the other’s opinion (Dragos & Neamtu, 2014). The neutral person does not
make any recommendation, he or she lets the parties agree among themselves to align the
differences, and then he/she summarizes the agreement in writing. Conciliation is simple less
costly, less formal, quick, confidential and private.
2.3 Mediation
Unlike conciliation, the third party plays a larger part in mediation. Like the conciliator,
the mediator remains neutral and meets with the involved parties independently. The mediator
then calls the parties together to resolve their disputes. While the mediators do not make any
decision, their participation involves making recommendations to aid the parties to reach a
solution (Kubba, 2012). Mediation is like a ‘higher level’ conciliation. Like other methods,
mediation is less costly, less formal, quick, confidential and private. The JCT Standard Building
Contract includes a clause that requires each of the disputing parties to consider the requests
made by the other party to engage in mediation (Dragos & Neamtu, 2014). Even though this does
not make mediation compulsory, some English courts strongly recommend the parties to use