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7
CONSTRUCTION WORLD
JANUARY
2017
Putlitz says silence is decidedly not golden when it comes to avoiding
strife on building sites. ‘’All signatories to a contract – no matter how
low they may feel they are in the pecking order – must immediately give
notice when aware of a looming potential problem. The key is to speak up
immediately: once resentment has started growing, conflict is difficult to
avoid,” Putlitz warns.
He says all standard construction contracts include procedures in
individual clauses to deal with items that may become a dispute if not
resolved timeously. These incidents could include:
• Provision of inadequate or incorrect information to the contractor;
• Delays to the project for various reasons;
• Additional costs;
• Appointment of subcontractors;
• Performance by subcontractors;
• Performance by the principal contractor;
• Changes by the employer;
• Changes for statutory compliance;
• Late or nonpayment by the employer; and
• Late or nonissue of payment and completion certificates by the contract
administrator.
“The contract administrators must fulfill their own contractual duties
as well as coordinate the obligations and rights of the contractor and
employer. If the administrator learns of a potential problem, he or she
must act immediately to hopefully resolve the issues raised. Where an
identified problem is not resolved, a further notice is generally required
before the contractor – and possibly the employer – can invoke the
suspension or termination clauses. Similarly, the dispute resolution
clauses may be invoked.”
Putlitz says it is crucial that the contract administrator, as well as the
contractual parties, promptly communicate in writing and keep records of
relevant information (site photos, delivery notes) to create an auditable
information trail should dispute events need to be proved later. “Keeping
minutes of all meetings in an agreed format and the prompt issue of
such minutes – and the approval of minutes, or the noting of corrections
– are equally crucial. The parties must resolve contractual claims as they
occur and the persons involved approached to find a solution. Leaving
this to the end of a contract creates uncertainty, and will end up as a
dispute as either party are likely to offer a myriad of excuses.’’
His advice is to keep accurate records in a format that can easily be
accessed; agree on communication procedures (and stick to them) and
speedily deal with all notifications of any potential problem – and hastily
find a solution by consensus.
Speak up – and create an
information trail
All parties involved in a building contract should not hesitate
to speak up the moment they spot a potential dispute,
advises Uwe Putlitz, CEO of the Joint Building Contracts
Committee (JBCC).