Risk sharing in the contract for construction work

Apollo, Magdalena; Siemaszko, Agata; Kristowski, Adam

doi:10.3311/ccc2018-087

Cited by 3 publications

(9 citation statements)

References 4 publications

(4 reference statements)

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“…The lack of detailed provisions regarding procedures to be followed for payment of remuneration and reporting defects was also one of the contractual disputes identified by this study. Apollo et al. (2018) also state that a lack of guidelines concerning the regulations of executing extra work and repairing construction works and their payment agreement could lead to disputes among parties.…”

Section: Discussion Of the Findingsmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

“…It is consequently in the contracting parties' best interests to cooperate toward preventing disagreements in the first place (Motsa, 2006). This can be accomplished, among other things, through improving communication and managing the contractor's working relationship (Apollo et al, 2018). To reduce contractual disputes and difficulty, all parties must efficiently carry out their tasks according to the contract (The World Bank, 2018).…”

Section: Effects Of Contractual Disputesmentioning

confidence: 99%

“…The end goal of successfully controlling or managing risks is to minimise unnecessary construction expenses and other occurrences that will slow down the construction site's work progress and effectively solve any misunderstandings (Apollo et al, 2018). Rehacek (2017) mentioned that all risk management approaches should be implemented from the beginning of any construction project to be successful.…”

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Effective management strategies for construction contract disputes

Amoah

Nkosazana

2022

IJBPA

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PurposeContract risk management has become a critical mission, as contract issues may lead to a loss of vast amounts of money to parties involved or cause project failure. This study sought to identify effective management strategies to mitigate construction contract issues that might emerge during construction.Design/methodology/approachA quantitative research approach was adopted for the study. Structured questionnaires made up of close-ended questions were distributed to construction professionals in South Africa via the SurveyMonkey platform. The data were then analysed using descriptive statistics.FindingsThe findings indicate that the critical sources of contract-related disputes are ambiguous definitions of the contract parties' scope of their rights and obligations, lack of precise arrangements regarding the calculation of contractual penalties for failure to meet the deadline, lack of detailed specification of the works and specific milestones, lack of provisions regulating changes to the project documentation during the construction stage, an excessive amount of contractual penalties on contractor's side and lack of provisions regarding the rules of performing additional and replacement works and their settlement. However, for these disputes to be effectively managed, strategies such as reduction uncertainties in project's phases, setting up contingency plans, construction guarantee, extension of time claims, payment guarantee, retention and escalation clause should be implemented by the parties involved.Research limitations/implicationsEven though the empirical study focused on construction professionals in South Africa, the findings could be applied to other countries outside of South Africa.Practical implicationsTo effectively manage and prevent contract disputes from averting project failures and losses to parties involved in the contract, construction professionals need to be aware of strategies that must be implemented before and during the project execution. If well implemented, these strategies will help a construction project be successful and experience fewer contractual disputes.Originality/valueThe study has identified the knowledge gap concerning suitable contract risk management strategies available for implementation to effectively prevent any contract parties from losing money, time and project failure.

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Section: Discussion Of the Findingsmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Section: Effects Of Contractual Disputesmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Effective management strategies for construction contract disputes

Amoah

Nkosazana

2022

IJBPA

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Guidelines for Mapping Rework in the Contract Conditions of Construction Projects

Asadi

Wilkinson

Rotimi

2023

J. Leg. Aff. Dispute Resolut. Eng. Constr.

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Construction Contracts Quality Assessment from the Point of View of Contractor and Customer

2023

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The cost and determination of construction projects are key issues for both customer and contractor when entering into a construction contract. For customers, calculation and evaluation of the cost of construction projects is complicated by the problem of underpricing, which may lead to the failure of contractors submitting a bid for a project, and, in addition, overpricing may lead to an overestimation of the average market value of specific groups of works. Therefore, the aim of the study is to compare the quality assurance of different contractors’ contracts using a multi-functional decision-making process and to develop a set of quality assessment criteria. The Analytic Hierarchy Process (AHP) was used to determine the significance of the criteria and afterwards to evaluate the construction contracts. Two groups of experts were involved in this research: specialists for the customer group, and specialists for the contractor group that comprised professionals in their respective fields, with many years of experience in managing and implementing construction projects. Based on the results of this study, conclusions and recommendations are presented regarding possibilities of ensuring quality of construction contracts and minimizing disputes between customer and contractor.

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Risk sharing in the contract for construction work

Cited by 3 publications

References 4 publications

Effective management strategies for construction contract disputes

Effective management strategies for construction contract disputes

Guidelines for Mapping Rework in the Contract Conditions of Construction Projects

Construction Contracts Quality Assessment from the Point of View of Contractor and Customer

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