Institute for Transportation

Three-Day Course Overview

Construction contracts, by their very nature, have a degree of uncertainty built into them. This uncertainty represents a risk—both to the owner and to the contractor. When work items are not specifically or adequately detailed in the contract, there can be differences in interpretation regarding what level of effort is required in the contract and what is considered additional effort. With additional effort comes the logical question of who owns the responsibility for any additional cost or time.

A great challenge for contract administrators is managing issues that appear to deviate from what is represented in the contract, or issues that require slight modification or clarification. A contract dispute often ensues when there is disagreement about who owns the responsibility for these deviations, modifications, or clarifications.

These differences represent a risk to the contract; they often lead to more time or cost than was anticipated by either party.

A contract administrator must use judgment and reason to resolve these disputes, especially when the underlying contract does not clearly assign responsibility for a given facet of the contract. If these disputes are settled without proper due diligence by the owner, the result can be an overpayment (i.e. additional payment for work already included in the contract). If an owner fails to acknowledge its responsibility within the contract, these unresolved disputes can become the basis for a contract claim. Ideally, a contract administrator uses experience and judgment to settle these disputes in a fair and equitable manner. Occasionally, the details of the dispute make assignment of responsibility very difficult. In such cases, if the owner is unable to determine their share of the responsibility for the dispute, it may evolve into a contract claim.

Part of being a successful contract administrator is knowing how to recognize these potential disputes—hidden within the proposed details in the contract plans and specifications—prior to the contract bidding. Spending adequate time and fully understanding the constructability issues and possible project risks is a critical part of claim avoidance that should occur in the design phase.

Ultimately, avoiding claims requires:

1. Providing clear direction in the plans and specifications in order to reduce the number of potential changes in a contract, and
2. Implementing practices that increase the likelihood of an owner and contractor resolving a dispute

Course Goal

The goal of this course is to promote techniques for managing and avoiding construction contract claims. Contract administrators learn to use the tools at their disposal to:

• Prevent disputes in the design phase whenever possible
• Resolve disputes during the construction phase if necessary
• Properly receive, analyze, negotiate, and settle claims if the dispute cannot be resolved equitably to both parties
• Prepare for post-claim review actions, such as dispute review board, arbitration, or litigation

Instructor

The instructor for this course is Roy Siegel, P.E., Construction and Contract Administration Engineer, in the FHWA Resource Center. He has been notified of the specifications typically used by local agencies in Iowa (e.g., SUDAS and DOT).

Hotel Accommodations

A block of rooms has been set aside at the Gateway Hotel and Conference Center for $99 a night. The deadline to use this block is December 17, 2019. Please call the hotel directly at 515-292-8600. There are also hotels nearby that may cost less during this time of the year.

Tentative Agenda

Download the tentative agenda here.