According to an industry report from management consulting firm Arcadis, the average value of construction disputes in North America hit $42.8 million in 2022, up 42% from $30.1 million in 2021.
Interestingly, the average dispute resolution time dropped by 19%. In 2022, it took 13.2 months to resolve construction disputes in North America compared to 16.7 months in 2021.
Effective communication has been a major contributor to this positive trend. This article highlights the latest developments in construction disputes and how effective communication can mitigate these issues.
The Value of Clear and Effective Communication
As in any industry, differing opinions on responsibilities are a common cause of construction conflicts. To combat this, every project should begin with a clear assignment of responsibilities, expectations on the quality of deliverables, and agreed upon dispute resolution methods.
If communication gaps exist between these parties, misunderstandings or misinterpretations of obligations and expectations can occur.
By opening communication lines, starting with the contract, issues can be avoided or better mitigated before escalating into litigated disputes. This also enhances real-time coordination and prompt identification and resolution of issues on predetermined terms.
Strategies for Streamlining Communication in Construction
Unlike other industries, establishing cohesive communication during construction projects can be problematic due to the complexity and scope and the high number of involved parties. The following strategies can help keep everyone in sync and foster a collaborative environment:
Centralized Communication Channels
A designated primary communication channel should exist whereby all project-related information, including progress and concerns, can be shared. This can be a shared online platform, daily or weekly meetings, or regular email updates. Make sure this channel of communication is accessible to all, in or out of the office for more expedient decision making.
Technology
Thanks to technological advances, the construction industry also enjoys access to various tools and software to facilitate open communication. The tools make real-time collaboration, progress tracking, and instant sharing of valuable documents effortless. These include the following:
Building Information Modeling (BIM): A digital representation of a construction project, allowing all parties to visualize the entire project, such as timelines and tasks, in real time.- Project management software: A centralized platform for managing projects, allocating tasks, and tracking progress.
- Cloud-based document sharing systems: A secure way to share and store essential project documents among project participants, allowing them instant access from any location.
- Virtual communication tools: These enable real-time discussions and meetings without the need for physical presence.
Effective Documentation
All project details, including communication exchanges, change orders, and approvals, should be properly documented and shared among all stakeholders. Effective documentation minimizes confusion and serves as a reference in case of disputes.
Meeting minutes should be recorded in an organized manner to provide a written account of discussions and decisions made. Also, all verbal communication should be followed up with written confirmation to avoid misunderstandings or disputes.
AI-powered recording and transcription software can be used to document meetings, decisions, and communication exchanges more efficiently and accurately.
How a Construction Dispute Attorney Can Facilitate Communication and Prevent Misunderstandings
A construction dispute attorney can review contracts for ambiguities before a project, or in the event of a dispute, making all parties aware of project details and their obligations. When in doubt, always default to an expert construction attorney for clarification.
In addition to standard inclusions, a comprehensive contract should incorporate and clearly define:
- Project scope and objectives
- Roles and responsibilities of each party
- Communication protocols
- Dispute resolution methods
- Payment terms
- Change order procedures
Including these essential elements as part of a complete contract will enable all parties to better identify potential areas of conflict and devise strategies to mitigate them.
Unfortunately, a considerable portion of the contract language will not be easily understood, often lacking necessary clear language.
In the event of a dispute, an experienced construction dispute attorney will also facilitate communication and prevent misunderstandings from escalating into cost and time-intensive legal battles.
If necessary, they are skilled as neutral third-party mediators to help conflicting parties come to a fair resolution and minimize damage to relationships and reputations.
The Role of Communication in Mitigating Construction Disputes
Effective communication is key to preventing construction disputes, ensuring all parties know their obligations, and work towards the same goals.
Whether you are reviewing a contract, in dispute, or headed to mediation, arbitration, or litigation, KPPB LAW’s seasoned construction dispute attorneys have extensive experience in all aspects of construction disputes and litigation.
They specialize in providing professional guidance to prevent or resolve construction disputes. Contact KPPB LAW today.