Problems, Issues & Legal in a Construction Project

Problems, Issues & Legal in a Construction Project

Construction projects are always changing, and the constant level of uncertainty can often bring conflict to project teams. Construction project managers are often tasked with resolving disputes, identifying and mitigating risks, and understanding legal ramifications. 
Here’s what construction project managers should know:

Resolve Disputes

Conflicts will inevitably arise in any project and it’s your job as the project manager to resolve the disputes so your team can stay productive and work well together. Possible conflicts in a project could include poor communication, lack of clarity, conflicts of interest, limited resources, or power struggles. While every conflict is different, there are a couple different resolution strategies that you may have to employ:
  • Mediation: A third-party mediator will be hired to resolve the disputes between the two parties. This strategy is the cheapest and least time-consuming. 
  • Mini-Trial: A mini-trial is held in an informal setting with an advisor or attorney that must be paid. The agreement is nonbinding and can be broken. A mini-trial takes more time and money than mediation.
  • Arbitration: Arbitration is the most expensive and time-consuming way to resolve a conflict. Each party is represented by an attorney while witnesses and evidence are presented. Then, the arbitrator makes a ruling and his final decision is a binding agreement.

Create a Risk Management Plan

By focusing on prevention, project managers can spend less time dealing with spontaneous problems and more time on reducing their impact. A risk management plan is used to manage all project risks, defines the roles of project staff in risk management, and identifies potential risks and categorizes them in terms of probability and impact. 

Understand Legal Principles

When project managers have to negotiate contracts, deal with jurisdiction's licensing requirements, purchase insurance, and manage job site safety, an understanding of legal principles can save time and money. There are several areas of liability in construction management. There could be a claim for failure to detect defective work, if a bid exceeds estimates, or if there is extended overhead or if the project is delayed. Most professional liability policies don’t cover any aspect of faulty workmanship (like fabrication or installation) nor do they cover economic risks, so project managers have to make sure they have the appropriate coverage and that they are doing everything they can to avoid liabilities and claims.

Prepare a Quality Control Plan

A quality control plan ensures that the building has reached a specific standard. Quality control is the last step a project goes through before being delivered to the owner and consists of a series of systems and procedures to make sure it meets the highest standards. Project managers will have to evaluate how to test quality, create a step-by-step process for auditing the project, and revise and review the plan to find new problem areas. They will also have to be knowledgeable in safety management and codes, building codes, and compliance codes, and include these aspects in the plan.

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