Construction Process
• Public- statutory control of process
• Private- market control of process
• Traditional system:
Contract
for
design
Arch/Engr
Owner
Contract for construction
Contractor
Non-contractual
relationship
Construction Process
• Process is influenced by:
– Delivery system used
– Project stakeholder map complexity
– Financing
– Location
• Unions
• Services
• “sophistication”
• Political climate and support for growth
Construction process
• Alternative Delivery Systems- design
build, CM at risk, public-private
partnership, contractor warranty and
maintenance bids
• Expert testimony- projects are more
complex and involve more parties, use of
experts will grow (can be lucrative)
• Waiver of claim- designers trying to buy
bid waivers- many courts have thrown
them out
Construction Process
• Project stakeholder maps
Indirect
stakeholders:
Neighborhoods
legal counsel
Owner
marketing
architects
developer
Designer
inspectors
Community groups
Environmental
groups
Political leaders
consultants
engineers
(M,S,E,C)
interiors
subcontractors
finances
Builder
unions
labor providers
Issues in the Profession
• Avoiding lawsuits
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Be honest, admit mistakes
Add value for those paying you
Pay those who add value for you
Cooperate to fix mistakes (don’t punish)
Don’t get fixated on small issues
Understand and listen well
Learn that different is not wrong or bad
Avoid “standing on principle”- pick your battles
Dispute Resolution
• Dispute resolution- contractor and
owner/subcontractor can differ on
dispute resolution terms. Best to
stay out of court.
• Different avenues for resolving
disagreements other than hiring a
lawyer
Dispute Resolution
• Staying out of court should be the ultimate goaluse alternative dispute resolution
• Avoidance- ignore the conflict, don’t talk to other
party; usually leads to bigger problem
• Intimidation- threaten the other party- don’t take
the bait (illegal in many situations)
• Negotiation- non-legal, or before a lawsuit ahs
been filed; interaction aimed at compromise or
win-win. Best Alternative to a Negotiated
Agreement is basis for judgment
Dispute Resolution
• Attorney assisted negotiation- legal rights
and best interests are different things;
lawyer income based on prolonging the
dispute
• Mediation- 3rd party listens and facilitates
dialogue; Mediator does not decide; each
side tells its story
– Use I statements
– Don’t be defensive
– De-personalize the situation
Dispute Resolution
• Arbitration- both sides tell their story
and arbitrator decides. Arbitrators
are privately employed, 3rd party
(impartial) judges. Much faster and
cheaper than litigation, usually
binding (no appeals)
• Litigation- use of government run
court system. Everything becomes
public.
Dispute Resolution
• Negotiation/mediation
– Focus on issues, not positions
– Have decision-makers in the room
– Keep emotions out of the discussion
– Listen well
– Don’t change mind after agreeing to the
deal
– Keep overall agreement give-and-take
in mind
– Do you homework- know what is
reasonable