Framework for mitigating contractual disputes in the Sri Lankan construction industry

Abstract

Dispute is defined as “any contract question or controversy that must be settled beyond the jobsite management”. Most of the construction disputes related to the contractual matters. The aim of the research was to develop a framework as a strategy that could mitigate to the occurrences of contractual disputes in Sri Lankan construction industry. Literature synthesis aimed at adapt the nature of contractual disputes by establishing critical attributes of contractual disputes, causes of contractual disputes, strategies used to avoid contractual disputes, Alternative Dispute Resolution methods and attributes in ADR methods. The five Semi-structured interviews and thirty five detailed questionnaire surveys were aimed at detailed studying of practical situation in Sri Lankan contractual disputes, identifying the areas, causes, effects, avoidance strategies of contractual disputes and attribute in Alternative Dispute Resolution methods and behaviour of the attributes in ADR methods. The research findings revealed major areas of contractual disputes named as general causes, contractor and owner related causes. Major causes of contractual disputes are ambiguities in contract documents, delays in work progress, design errors and major effects identified as cost overruns, project delays and damage business relationships. Contract documentation, proper coordination between contract documents and proper contract administration are the major contractual dispute avoidance strategies. Furthermore, major attributes in ADR methods are identified as duration of the proceeding, obtaining fairness decision and binding of the decision. Further research findings are revealed that arbitration require highest duration of the proceeding, mediation provide the more fair decision and arbitration decision is more binding and enforceable.