Construction Contracts Masterclass

Developing & Managing Successful Construction Contracts

Introduction

This Construction Contracts Masterclass training will help the delegates to understand about the contractual disputes and conflicts arise in the engineering and construction projects, the reasons why such problems arise, and how to avoid them in the future. These problems have reduced the efficiency and profitability of developments, and have not been to the benefit of either clients or contractors. Both engineering and construction tend to attract contractual problems because of the complex nature of the work itself, and also the complicated commercial arrangements involved.

Many contracts are now being conducted in a different way to the traditional approach, with more openness between the parties, and this has, in some cases at least, reduced conflict and increased profitability for all parties.

This training highlights will include:

• A review of major issues in engineering and construction contracting
• An examination of why things so often go wrong
• A consideration of ways to improve
• Detailed discussion as to how a more collaborative approach might benefit engineering and construction projects
• Examination of real issues, from real projects

Objectives

This training course has the following main objectives:

• Understand how contracts work, and why they sometimes cause problems
• Address some specific clauses and provisions that are a common source of problems
• Develop thinking around more collaborative approaches to working on engineering and construction contracts
• Recognise the dangers that such approaches bring, and how to minimise problems
• Look at engineering and construction contracting in an international context
• Understand how to resolve disputes quickly and efficiently

Training Methodology

This LAKESHORE ISL Construction Contracts Masterclass training will be delivered using a mixture of trainer-led discussion, using real examples wherever possible, and group exercises to develop new ways of thinking around the whole issue of engineering and construction contracts and their associated problems.

Organisational Impact

This LAKESHORE ISL training course will deliver the following benefits to the organisations to which the delegates belong:

• Delegates will have obtained a better understanding of the contractual issues involved in engineering and construction contracts
• Better communication between commercial and legal personnel
• A wider range of possible contracting options
• Better ways to resolve disputes
• Projects will be more successful
• Reduced project times and improved profitability

Personal Impact

This LAKESHORE ISL training programme will deliver the following benefits to the delegates:

• Better understanding of engineering and construction contracts, and the problems that can arise
• Deeper appreciation of the main clauses that can cause problems, and how they can be reduced or avoided
• Greater choice of methods for contracting for engineering and construction projects
• Understanding how greater collaboration can, if handled properly, reduce conflict
• Better skills and techniques for resolving disputes
• Wider skill base, meaning greater scope for career development

Who Should Attend?

• Business Managers
• Commercial Staff
• Project Managers
• Project Engineers
• Procurement Staff
• Legal Staff
• All involved in disputes and their resolution
• All staff involved in selecting contracting strategies
• Staff new to engineering or construction contracting
• Experienced staff looking for a refresher, together with new ideas
• Staff from client / developer and contractor / subcontractor backgrounds

Seminar Outline

DAY 1

The Fundamentals of Engineering and Construction Contracts

• Why Contracts are necessary?
• How Contracts are formed?
• Particular issues with Engineering and Construction Contracts
• Use of Standard Forms
• FIDIC
• NEC
• LOGIC
• Differences in Bargaining Positions
• Problems with Competitive Tendering
• Problems with Different Industries – including between Engineering and Construction
• Different Regions / Countries
• Issues with Different Legal Systems

DAY 2

Some Major Problem Clauses in Engineering and Construction Contracts

• Design Responsibility
• Requiring Contractors to Warrant the Design of others
• Standard of Work
• Fitness for Purpose
• International / National / Company Standards
• Standards for Professional Services
• Variations
• Time
• Money
• Force Majeure
• Intellectual Property
• Limits of Liability
• Indemnities
• Insurance
• Some Minor Problems
• Notices
• Entire Agreement
• Incorporation by Reference

DAY 3

Traditional Approaches to Engineering and Construction Contracts

• Lump Sum / Fixed Price
• Bill of Quantities / Schedule of Rates
• Adding Incentive Fees
• Escalation
• Dealing with General Price Inflation
• Economic Price Adjustment
• Problems with Volatile Materials (or labour) Markets
• Selecting the Right Index
• Call-off Contracts

DAY 4

Looking Beyond the Traditional Approaches

• Risk and Reward Structures
• Build Operate Transfer (and similar models)
• Open Book Approaches
• Collaborative Working
• Advantages
• Dangers – and how to avoid them
• This session will involve delegates in developing their own ideas as to different ways in which engineering and/or construction contracts could be structured, so that commercial drivers are focused on the goals of the parties, not on conflict

DAY 5

Disputes – Avoidance and Resolution

• How Disputes Arise
• Methods to Avoid Disputes, or Deal with them quickly as they arise
• Negotiation Techniques
• Traditional Third Party Approaches
• Courts (litigation)
• Arbitration
• Adjudication
• Some Alternative Approaches
• Mediation
• Conciliation
• Early Neutral Evaluation
• Expert Determination
• Dispute Review Boards and similar arrangements
• Pendulum Arbitration
• Mini-Arbitration
• Final Questions and Wrap-up