Journal of Legal Affairs and Dispute Resolution in Engineering and Construction

Forum papers are thought-provoking opinion pieces or essays founded in fact, sometimes containing speculation, on a civil engineering topic of general interest and relevance to the readership of the journal. The views expressed in this Forum article do not necessarily reflect the views of ASCE or the Editorial Board of the journal.

Construction defect litigation has a large effect on contractors, home builders, and engineers. This research builds on previous research that identified common construction defects and suggested the majority of common construction defects generally relate to keeping water out of or flowing away from a building or structure. The focus of this follow-up research is an inventory and analysis of defects specifically related to building envelope issues. The authors analyze 46 construction defect cases litigated between 2011 and 2019 that include issues related to building envelope design and construction to more accurately assess the most commonly cited building envelope issues, their details, and their associated trends. Findings reveal improper sealing of penetrations, improper integration and lapping of the weather resistant barrier (WRB), improper flashing, and improper weep mechanisms, all of which involve water penetration and are the most prominent and high impact defects. Findings also reveal that the most prominent alleged defects occur where water can infiltrate and damage the building envelope. Finally, the findings indicate that the cited alleged defects relative to the building envelope are more numerous and complex than cited alleged defects in other disciplines, specifically civil or mechanical engineering. The contribution of this research is (1) to identify and create detailed description of building envelope–related defects, and (2) to inform design and construction professionals of their responsibilities and liabilities of these building envelope–related defects with the goal of helping to reduce future construction defect litigation.

Labor productivity is susceptible to many factors, including those related to working conditions, methods, and construction resources. It is not uncommon to see that contractors performed the work in a different manner than what was originally anticipated for factors either within or beyond contractor’s control. Similar to changes expressly or constructively directed by the owner, contractors’ underestimates could also lead to an unanticipated condition causing a decline in productivity. Many papers have focused on the impact on labor productivity from the changes beyond the contractor’s control, but little research has been done on underestimates, including their prevalence, severity, and impact on labor productivity, in a reliable, quantitative way. In order to help project owners, contractors, and other parties better understand the issues impacting labor productivity on their projects, this paper reports a quantitative analysis on the impact of underestimates on productivity, using data published in the past, investigating the amount, likelihood, and impacts of underestimates. This analysis generally confirms the negative impacts of underestimate from a statistical perspective. Findings presented in this paper can help provide valuable insight in determining the root causes of loss of productivity, and resolve issues related to construction productivity. It is also hoped that more research can be inspired by this pilot investigation to advance the body of knowledge on this subject.

Information management is a critical aspect of project delivery in the architecture, engineering, and construction (AEC) industry. Previous studies have identified legal factors as an integral part of developing and implementing information management processes, but there is a need to study these factors in the AEC project context. The objective of this research was to identify and prioritize legal factors impacting information management in the AEC industry in the context of vertical construction projects delivered using design/bid/build. Researchers implemented the Delphi method to identify and prioritize these legal factors impacting information management. First, researchers assembled an expert panel of AEC industry practitioners. Next, a literature review was completed to develop an introductory survey that served to solicit additional factors from the expert panel and to confirm the expert panel’s qualifications. Three rounds of Delphi surveys were administered to score and rank 15 factors impacting information management. Experts were asked to consider a vertical construction project delivered using design/bid/build when ranking factors in order to promote consistency. The results indicated that risk allocation in contracts, data translation, and information preservation were the top-ranked factors. The findings of this study can serve as a guide for practitioners when developing and implementing information management processes. Furthermore, these findings contribute to the body of knowledge by identifying and prioritizing legal factors that impact information management in vertical construction projects delivered using the design/bid/build delivery method.

Contracts between government and private entities are a daily occurrence. The administrative contracts are concluded by selecting the private partner by the public authority, through the means provided by the law such as tenders, auction, and direct negotiation. Such contracts are governed by the national public procurement law of the country. The term public procurement law relates to those legal provisions and legitimate arrangements that control the purchasing and procuring of works, services, and goods by the government, institutions, and public bodies. These include, among others, ministries, public enterprises, municipalities, and city councils. On October 3, 2018, a new Egyptian public procurement, namely, Law No. 182 of 2018, was issued to regulate contracts concluded by public authorities. The executive regulation of the law was issued on October 31, 2019. This paper presents a set of proposed amendments to the law, in line with relevant laws in many countries of the world, standard forms of contracts, and court rules to make it more equitable and to avoid unbalanced provisions that make international contractors and investors refrain from dealing with major projects in Egypt. The suggested amendments address two specific subjects, delay claims by the contractor and the limit of compensation under performance guarantee.

Visualizing and analyzing the specifics of delay claims in relation to effects and causes and assigning responsibility are a challenge for attorneys, jurists, and judges. Four-dimensional (4D) simulation can be considered as a part of a claim management system for representing the responsibility and impact, and can be used as the main scheduling method of claims resolution. Building information modeling (BIM), 4D simulation, delay effects and causes (DEC), and claims are knowledge domains with active research in the construction industry, which are individually described in the literature using taxonomies and ontologies. However, there is a gap in integrating these ontologies in a more formal and overarching ontology-based approach to grasp essential concepts such as liability, causality, and quantum in a delay claim using 4D simulation. This article proposes a new method for using 4D simulation for visual analytics of delay claims based on an integrated ontology (called Claim4D-Onto), which includes a taxonomy of the quantum, causality, and assigned responsibility. A case study is used to demonstrate the benefits of the proposed method. This method can provide a promising multidisciplinary tool for quicker and fair settlement of construction delay claims by facilitating hearing procedures and catalyzing pretrial negotiations.

The literature on public-private partnership (PPP) agreements suggests that variation renegotiation places the public sector authority at a disadvantage, because the authority has to pay extra costs to claim its variation. This leads to the need for a PPP contract to incorporate flexibility, embedded with real options analysis (ROA), to deal with these variations. This paper proposes that PPP agreements should ideally contain an option for the authority to order variation as an effective response to changing circumstances in the postconstruction phase throughout the concession period of toll roads. Having the variation option, the authority sets a threshold on the concessionaire’s bargaining power via variation negotiation as the authority can order its variation at its favorably controlled price. The paper also presents the ROA, based on the probabilistic cash flow approach, that gives the financial value of flexibility for the authority to order variation. This approach is straightforward and provides a fair way forward for the implementation of PPP toll roads.

Disputes are inevitable in construction projects, and planning to manage them is considered as a significant problem of project contract management. In this knowledge area of project management, there are two distinguishable subjects: diverse types of disputes and different methods for addressing them. The main purpose of the current investigation is to recognize the most frequent disputes in projects of the downstream sector of the petroleum industry and the early assignment of the most appropriate alternative dispute resolution (ADR) methods to them in the precontract phase. For this purpose, available dispute resolution methods were investigated and some alternatives were selected. Concurrently, and based on the expert judgment, various types of disputes in these projects were categorized, and a dispute breakdown structure (DBS) is proposed. Finally, by mapping resolution options with potential disputes using the Delphi process, a multihybrid framework was developed for resolving disputes in the downstream sector of the petroleum industry in an appropriate and optimum way. This framework which should be translated to the contract legal language in practice and subsequently be inserted into construction agreement as a clause, potentially can be customized for various types of projects.

The construction process is multistage and usually involves different stakeholders. The stakeholders of this process pursue different goals and implement them by different means, which would predetermine various disputable situations. In case of resolving disputes in the court, it is necessary to prepare and provide a large number of documents and evidence. Those need to be prepared separately for each defendant depending on the type of dispute. Resolving construction disputes by such judicial way takes a substantial period of time and incurs substantial expenses. Large amounts of company resources and time are invested to dispute-resolving processes that can be used in a business. Among the various dispute resolution methods, mediation has been increasingly gaining recognition and acceptance in construction. Unfortunately, in new European countries like Lithuania, the implementation of mediation is still in the initial stage. This study encompasses the nature of construction disputes, key features of mediation, analysis of main differences among court and mediation processes, and pros and cons of mediation with special reference to the construction industry in Germany and Lithuania. Based on these results, recommendations to increase mediation in Countries that are new to the EU countries are elaborated. Finally, it is concluded that more education of construction professionals about mediation, more training of competent construction mediation, and incorporation of mediation clauses in construction contracts are strongly advocated.

For centuries, party walls have been a common construction practice in many countries. In New York City (NYC), they have been used since the 1700s. The city accounts for about 201,000 attached buildings. The historic NYC speculative construction practice relied heavily on attached row houses built by the same developer; agreements were rarely drafted and the number of party walls or remnants thereof is not certain. This paper examines the issues related to new construction involving existing party walls. Insufficient prior investigations led to redesigns, accidents, or delays. Out of concerns of pounding during earthquakes, recent building codes require structures be separated by a gap, involuntarily complicating even alterations along party walls. The longest delays, though, are caused by adjoining owners opposed to the development or intent to maximize financial gains through litigation. They resist inspections or any physical attachment to walls, even necessary repairs. The study juxtaposes $15\mathrm{years}$ of building violations, incidents, construction regulations, and legal decisions. It tracks construction accidents that led to building regulations increasingly progressing from empirical to engineered construction safety inspections. In turn, these prompted a 10-fold increase in court petitions based on statutes, but only minor changes in common law. Concerns are raised that some litigations may set aside safety and structural stability issues. Analysis of typical party wall scenarios concludes that in almost all cases development requires licenses to inspect and repair. In their absence, architectural and structural solutions need to account for risks posed by legal uncertainties.

Industry has recognized that the cumulative impact of changes is a factor that may possibly affect labor productivity. The ripple effect of changes may be impossible to capture in the discrete effects of individual changes. This ripple effect can be disruptive and detrimental to labor productivity if it negatively impacts resources, working conditions, and/or means and methods. Various researchers have attempted to investigate the cumulative impact of changes in a quantitative way, and some regression curves for the relationship between labor productivity and project changes have been developed based on statistical analyses. The reliability of these curves is questionable with regard to the representativeness and reliability of the data, but major flaws in these regressed curves are associated with the form of the trendline functions, which are elaborated in this paper. This paper presents a corrected form of the trendline function with mathematical justification. The corrected form of the trendline function is further validated with published data. The findings presented in this paper can help provide valuable insight into determining the relationship between labor productivity and changes and resolve issues related to the cumulative impact of changes.

In order to effectively carry out contract management activities, contract professionals are required to meet several competencies that are relevant to construction contract management (CCM) practices. However, there has been scarce research on this topic, particularly in the Indonesian context. This paper addresses this challenge by developing a CCM competency model through a systematic procedure involving (1) identification of CCM competencies from relevant literature, (2) measurement of CCM competencies (covering both proficiency and significance measurements) based on questionnaire surveys, and (3) establishment of a competency model for CCM practices. Using the coding analysis, this study found 39 CCM competencies from the literature, and the quantitative data were analyzed using descriptive statistics and a significance index. These findings were synthesized to develop a CCM competency model. It was found that there is a skill gap in Indonesian CCM practices, with a proficiency level much lower than the significance level. This study also contributed to the body of knowledge by developing an applicable CCM competency model that can serve as a strategic tool for improving contract management capabilities for construction contract professionals.

A construction contract is a mutually agreed upon and signed document by the contracting parties and plays a significant role in controlling and preventing disputes in a project. This paper’s main objective is to develop a framework to assess sources of ambiguity in construction contracts for comprehensive referencing and early detection of potential root causes of claims and disputes. This is addressed by (1) developing a hierarchical concept map, representing well-rounded sources of contract ambiguities through a comprehensive analysis of the literature; and (2) validating the proposed model by the analysis of relevant court cases at the Supreme Court of Canada (SCC) as the court of last resort in the Canadian judicial system. Starting with 285 relevant cases in construction (from a total of 30,500 cases listed on the SCC website), we defined topical, temporal, and geographic criteria, and narrowed the cases accordingly down to 50, which underwent a first-level analysis, and 13 cases, which went through a detailed analysis. The study found that incomplete and/or redundant information in the contract documents are the core reasons for conflict between contracted parties in the Canadian construction industry. Therefore, proactive identification of sources of ambiguity in contract documents by the general contractor and owner and attentive preparation of contract documents to avoid contradictory information/terms, missing information, or vague clauses can minimize the potential lengthy and costly litigation process at the court level.

Unit price contracts are awarded to contractors based on estimated quantities of work, while payments to contractors are based on the actual quantities performed. Deviations between such estimated and actual quantities expose contractors and owners to various amounts of financial risks. In order to reduce those risks, variation in estimated quantity (VEQ) clauses are usually found in construction contracts. There is a need to support contractors in analyzing and quantifying the financial risks associated with the terms of the applicable changed quantity clauses. This paper presents a review of the terms of VEQ clauses included in public construction contracts. Then the paper examines the impact of VEQ clauses on the distribution of financial risks associated with changes in quantities between the owner and the contractor. The paper shows significant inconsistencies between the terms and stipulations of variation in estimated quantity clauses adopted by different US public construction authorities and international construction contract forms. An illustrative example is provided to highlight and quantify the varying amounts of risks incurred by contractors, depending on the terms and conditions of the variation in estimated quantity clause imposed by the contracting public authority in the construction contract. Contractors should be able to identify and quantify these risks before submitting their bid offers. The performed analysis should prove to be useful to the contracting parties and can reduce the potential for disputes related to changes in quantities of work.

Despite the interest that environmental prudence has garnered worldwide, the construction industry remains behind in incorporating sustainable concepts in construction contracts and contract administration. Some research promotes the adoption of sustainability clauses into construction contracts, and some of the standard contract forms include sections on sustainability. However, there is no research to date that analyzes the current state of adopting sustainable practices and techniques in contractual terms. There are also no specific measures tailored to the different types of construction projects, and owner/developers have no tools to assess sustainability components of their construction contracts. Therefore, this research investigated the degree of incorporation of sustainability clauses in construction contracts in the United Arab Emirates. Sustainable practices were collected from the literature and validated via interviews with 5 construction organizations and surveys of 11 more to develop the Sustainability Inclusion in Construction Contracts Index (SICCI) in line with the United Nations Sustainable Development Goals (UNSDGs). The SICCI was designed and validated to measure the inclusion of sustainable practices in contractual terms typically used by the construction industry. The resulting index was applied as a case study to a residential construction project in the United Arab Emirates. The project team found the index very usable and the project scored a 70% inclusion rate in contractual terms. Inclusion assessment is the first step in true adoption of sustainable development concepts in construction projects. This paper recommends further adoption of this tool in construction organizations to promote sustainable practices.

There is growing awareness and use of building information modeling (BIM) for construction project delivery and operation of facilities. Evidence of successful project delivery with BIM abounds, and large facility owners are increasingly adopting BIM project delivery. BIM has shown increased efficiency in integrating the people, processes, and technology involved in facilities management. Concurrently, owners are turning toward leveraging the sophisticated technology and processes afforded by BIM to derive more value from their facilities. This involves navigating complex organizational and technical issues, leading to a shift from traditional practices. However, there are still uncertainties regarding the legal aspects of applying BIM to facilities management, because the domain is still in an incipient stage of maturity both in academic research and practice. This paper provides an overview of the potential legal issues and opportunities associated with the use of BIM for facilities management. Using a combination of a literature review and a case study of a large capital improvement project, legal issues arising from uncertainty and lack of definite contract instruments are presented and discussed. The paper discusses issues relating to liability/risk sharing and management, ownership of data and model, compensation, information exchange, interoperability, right to rely on model data, and insurance. Recommendations are made with regard to how owners can use American Institute of Architects (AIA) digital practice documents and ConsensusDocs 301 to facilitate the use of BIM for facilities management (FM). Further suggestions are made for amendment of such digital contract addenda to support BIM for FM.

Construction projects, by their very nature, are capital-intensive and risk-prone. Risk allocation and its management are therefore, integral parts of construction operations. A reasonably drafted contract allocates risk to the party that is best capable of handling it. Imbalance in risk allocation, however, is a common contract feature. By including exculpatory clauses, risks are often transferred without assessing a party’s ability to handle them. This bias in risk allocation promotes an adversarial relationship. Therefore, it is essential to identify such clauses before signing a contract. While it is possible to identify them by reading the bid documents, the manual process is time-consuming and often not pursued considering the lack of time in the bidding stage. Automation of such tasks can therefore aid a manager’s decision making. However, it requires tools that can quickly and reliably identify and extract exculpatory clauses. This study developed a natural language processing (NLP) model as a proof of concept to identify exculpatory clauses automatically. The developed model demonstrates that NLP is a potentially useful tool, aiding decision makers in refining their negotiation strategies before signing a contract.

Inadequate signage and pavement markings and driver distractions in roadway work zones are contributory high-risk factors for workers and drivers on two-lane rural and multilane freeway facilities. The changes imposed by a work zone on operating conditions or roadway alignment, including the installation of temporary traffic control (TTC) devices and barriers, lane and shoulder width changes, and the presence of construction equipment, personnel, and materials, increase driver workload and the risk of high-severity crashes. Driving simulations are a useful tool that has been used for the analysis of operational and safety aspects of different geometric scenarios in both rural and urban contexts. A previous driving simulator experiment regarding the impact of an active global positioning system (GPS) while driving in the TTC zone of a work zone on a high-speed divided highway concluded that smartphone usage increases driver distractions and has the potential to contribute to severe and fatal crashes. This paper presents the results of a driving simulator study that compared the potential safety implications related to the use of a GPS while driving in two different road geometries and operational situations (two-lane rural road versus multilane divided freeway). Specifically, the effects of the distraction caused by the navigation information provided by an active GPS while approaching or entering the advanced warning area of the TTC zone and driver compliance with work zone regulations were investigated. The TTC design in the simulations followed the corresponding suggestions presented in typical applications (TAs) of a manual on uniform traffic control devices (MUTCD). However, the implementation of TTC on actual work zone activities on two-lane rural roads does not always follow MUTCD recommendations. The results indicated that drivers following GPS routing directions on two-lane rural roads are more likely to encroach on the work space, suggesting that additional or stricter precautions and measures must be implemented in TTC plans in order to mitigate the safety impact of distracted drivers. Supplementary and more stringent legislation is recommended to tackle three main aspects: driving distracted with GPS, encroaching on the work space, and compliance with safe TTC designs.

From the economic value and contribution point of view to gross domestic product (GDP), it is highly important to find efficiency through new technology and digital tools as modern practices in the New Zealand construction industry. This requires coordinated efforts and greater alignment in using technology and information technology (IT) infrastructure provisions in complex and smart construction projects and operations. However, construction projects experience indicates delays as a recurring issue that requires constant assessing of these delays’ causes and impact. Many delay analysis methods and causal factors are being recognized, but none has considered whether information and communications technology (ICT) infrastructure such as software and smart platforms affect these delay causes and events. This paper aims to identify and rank the causes of delay, which happened through using software and ICT platforms in smart and complex construction projects in New Zealand. Initially, the delay causes were classified, and 15 executed smart construction projects were identified and studied. The projects were selected based on purposive sampling from the different contracting organizations. Accordingly, the project managers and engineers involved participated in a survey on the actual delay causes in these projects. This study utilized the correlation coefficient and ranking of relative importance index (RII) to prioritize the causes of delay. The result presented a list of 20 factors in three classes of design/engineering (DE), client (CL), and contractor (CO). The results revealed that issues such as retrieving information, gathering and screening real-time data on the site, and lack of multicommunication channels between parties and stages (pre- and postconstruction) could be significant causes of delay in smart projects with the expansion of smart tools and techniques in construction. Meanwhile, consents and ethics can potentially become another potential cause of delay, which requires further attention.