According to the given case, ABC Ltd has won a place on the framework agreement to refurbish sixblocks of public housing block for Housing Development Board (HDB). The board needs to ensure every process of the building construction. With respect to this, roles and responsibility of the owner will be as follows:
According to the given case, ABC Ltd has won a place on the framework agreement to refurbish sixblocks of public housing block for Housing Development Board (HDB). The board needs to ensure every process of the building construction. With respect to this, roles and responsibility of the owner will be as follows:
His role is to manage and maintain the costs with respect to the construction projects. Responsibilities are as:
Roles and Responsibilities of Engineer:
The contract clauses which are related to the valuation of the variations are as follows:
A contract under the valuation of variation does not allow theclient to make changes in the scope of their work. With respect to the case, under this contract the client,i.e., ABC Ltd is unable to make avariation in its work or working structure which is provided by the Housing Development Board (HDB). Under some contract, Architects of Duck Architect Ltd, Structural Consultants of Jack Engineering Limited, Project Manager, Quantity surveyor and Lighting Engineer can request for some changes with reference to their work and related areas but can implement them only on the permission of HDB. Along with this, all the particulars of the project can claim for the extension of time, where seeks compensation for the extra cost. With respect to it, thecontractor can be granted the extension of time by the HDB but will not get any extra charge if it will not ask for financial compensation. The power of accepting or rejecting changes is in hand of HDB (Keshavjee, 2013).
In the area of construction and engineering contract, the contractor gets payments as per the variations like abill of quantities. In context to this, particulars of the project like Architects, M&E Consultants, Structural Consultants, etc. can claim for the variation in payment by providing sufficient documents to the employer of Housing Development Board of Singapore within a particular period. As per the terms of thecontract, theengineer can have authority to agree on the variations by involving both assessments of compensation and time extension (Contract Variations. 2008).
Variations and claims are two different part of thecontract. Any claim regarding the variation can only make if the employee rejects the application and contractor disagree with the decision and wants to file a claim. With respect to thecase, variation can occur for changes like thedesign, cost with respect to refurbish six blocks of thepublic housing block.
As per the given case, HDB can face various contractual issues which are as follows:
It is necessary for HDB to handle and manage all the above issues properly for ensuring the building construction and development in the decided time without any disturbance. In case, above discussed conflicts cannot be resolved by the HDB than contractor or project particulars have right to claim against them. For handling the problems and accomplishing the objective, HDB will have to use below described mechanisms:
Negotiation:
It is one of the widely used methods for resolving issues and includes both bilateral and multilateral processes. This arrangement will lead to afocused discussion on the area of dispute among the engineers and other particulars of the project with the intention of resolving the differences without involving any third party. By creating discussion between the parties peacefully, HDB will able to settle their issues.
Adjudicatory Dispute Resolution:
This method is common and widespread in the construction sector worldwide. The problems can leave a cascading impact on the project of building torefurbish so to address them, HDB can use this mechanism. Under this, parties can select from a broad range of dispute resolution mechanism which consists of Dispute Boards, Expert Determination, Litigation or Arbitration (Johnson, 2017).
Dispute Board:
Under this, HDB can handle the issues regarding time-sensitivity. Engineers or other particulars can ask for anextension of time due to work complexity or other reasons, but HDB wants to complete theproject in thedecidedperiod. The company will have to set a Dispute boardto resolve such time-related issues. This board leads to perform two essential functions: a) Quick resolution of the dispute and b) preventing disputes by simple discussions or negotiations. Dispute Board can help HDB in accomplishing its objective of refurnish building in thedesiredperiod.
Arbitration
HDB can use this mechanism for handling the problems regarding the technical disputes in its construction project. It can be utilized as efficient, confidential and cheaper way for litigation. Under this method, HDB can allow its parties a significant degree of flexibility along with control on the dispute resolution. By offering freedom to select a tribunal with the skill-set and proper knowledge, thecompany will able to provide appropriate work to the particulars (Khekale and Futane, 2015).
Expert Determination:
HDB can use this mode for handling the issues ideally suited to variation claims or claims regarding extra work. Technical experts take decisions concerning to the disputes which cause during the execution of the contract. This method allows problems to be readily adjudicated in the first instance for avoiding any delay in the project of construction.
Litigation:
It is the final resolution process which is used for handling the previous procedures which have failed to achieve the desired results. With the help of this method, HDB can take help of court for resolving the problem efficiently. In this, thedispute is taken to court in front of ajudge and includes a complicated process which needs significant resources like legal representation. The courts follow proper rules, regulations, and legislation for handling the issue and deciding the appropriate result.
All the above mechanism can help HDB to handle its problem actually and continues the project execution for completing it in thedesiredperiod.
Dispute resolution is basically the process of resolving disputes among various parties involved in a contract. This term can also be used interchangeably with conflict resolution in which conflict style could be used in different scenarios (Bacow and Wheeler, 2013). There are various methods of dispute resolution exist for resolving it like; filing a lawsuit, arbitration, collaborative law, mediation, conciliation, several types of negotiation and facilitation. Any of the methods could be used for resolving disputes when arises due to any reason. Moreover, it is essential to have knowledge of dispute resolution because it helps in many ways when contract is breached. There are various benefits linked with it so it which a party can reap out when he contract gets breached by other party for some reason. There are basically two conditions listed below during which other party to contract dissolve the contract so the firm utilized the dispute resolution which benefitted the company in many terms. Due to certain knowledge of dispute resolution, benefitted the firm during the breach of contract during an unforeseen circumstances (Moffitt and Bordone, 2012).
It is given that ABC Ltd. has been awarded with HDB project for constructing residential estate of 600 units along with two MSCP. For that purpose, the company signup up with various contractors for the supplies of raw material for construction, core structural sub-contracts and architectural sub-contracts and many more. However, due to bad weather in an area delayed the construction process. Therefore, these parties started disputes with the company for which company has generous amount of knowledge about dispute resolution process. Moreover, the foreign employees also tightened to work or invest which is again an unpredictable circumstance for the firm (Goldberg and et al., 2014). Therefore, the knowledge of dispute resolution benefitted the company during these situations. Therefore, company already included the point of dispute resolution clause in the agreement for which company can make utilization of this clause anytime during the conflict. Furthermore, this will help the company in solving the dispute in an easier manner because this clause states multiple ways of resolving issue and this will help the firm in chalking out when, where and who will resolve the dispute. This will further avoid prolonging any disagreement because resolution process will get start quickly.
In addition to this, this also benefits in avoiding litigation which is the best option because litigation involves huge waste of time and money. As there are number of ways which can be utilized for conflict resolving that can be utilized by the parties. Furthermore, this also involve lesser time so contract can be resumed very quickly (Keršuliene,Zavadskas and Turskis, 2010). Moreover, this rescue the business relations because if litigation is filed up between parties then it dissolve relations between two parties and they both will never work in future again. However, in dispute resolution, relations could be saved as it does not involve intense fight between two parties. Moreover, it saves lot of time and money which get wasted during court case. The reason is that, dispute gets resolved easily and quickly, however, court case longer time to resolve and it also discarded the business relations (Lumineau and Malhotra, 2011). Therefore, the knowledge of dispute resolution saved the company during bad weather and tightening of foreign employees. The company can setup dispute resolution meeting where both parties can make understand regarding their situation which will help in dissolving the issues and then ABC Ltd. can restart their project after the bad weather.
Construction project involves high amount of risk because of its nature of work. Unforeseen circumstances can occur at any point of time which may hinder the contract. Moreover, the company must buy every material required for building a housing society, under a warranty period so that they could be replaced (Turner, 2014). Moreover, insurance should be done in case of accident; money can be recovered from the insurance company which will save money to the company. Furthermore, a bond should be signed with certain parties so that services could be taken from them whenever required (Lehman, 2013).
Moreover, benefits of insurance in construction project include business risk, safety by awareness, economic stimulation, planning and peace of mind, health and wellness. Therefore, as per the case, when accident occurred during the inspection at handover stage, company can make use of insurance through which medical insurance could be claimed by the firm so that an injured person could be treated in a good hospital. Along with that, under the insurance for the housing society, company can do the construction again without spending any more money. Furthermore, importance of bond includes; financial security and construction assurance (Appleman, Appleman and Holmes, 2016). As it is known that construction project involve high risk of money and delaying in project is common due to unforeseen circumstances. Therefore, bond provides construction assurance. Relating with the case, during the inspection in handover stage, an accident occur and this can hinder the project completion at final stage. However, bond saved the company by providing construction assurance and financial aid and using it company continued its construction (Jervis and Levin, 2008).
In addition to this, warranties in construction project can benefit the company in many ways. The firm can get the material replaced in case they are not of expected quality. This will save the money and reputation of the company. By using this reputation, company can get more projects in future (Tomlinson and Woodward, 2014). As per the given case, after 4 years of project handover, town council complained about the M&E and water seepage in housing society. However, the residential estate was covering under the warranty period so the company replaced the non-working items and also got the seepage re-constructed which helped the firm in getting done in a quick time and with no use of money. Therefore, it can be concluded that by using these terms in contract, company can mitigate the risk and get the surety of construction under any unforeseen circumstances.
References
Appleman, J.A., Appleman, J. and Holmes, E.M., 2016. Contract Concerns: Reinsurance Contract Formation, Validity, And Judicial Construction (Vol. 14). Appleman on Insurance Law and Practice.
Genn, H., Greger, R. and Menkel-Meadow, C., 2014. Regulating dispute resolution: ADR and access to justice at the crossroads. Bloomsbury Publishing.
Goldberg, S.B. and et al., 2014. Dispute resolution: Negotiation, mediation and other processes. Wolters Kluwer Law & Business.
Goldberg, S.B., Sander, F.E., Rogers, N.H. and Cole, S.R., 2014. Dispute resolution: Negotiation, mediation and other processes. Wolters Kluwer Law & Business.
Hoffman, S.J., 2014. Promoting compliance through effective dispute resolution. Routledge Handbook of Global Health Security, p.239.
Jervis, B.M. and Levin, P., 2008. Construction law, principles and practice. McGraw-Hill College.
Johnson, P.J., 2017. Effectiveness of dispute resolution mechanisms in natural resource management in Ontario/by Peter John Johnson.
Keršuliene, V., Zavadskas, E.K. and Turskis, Z., 2010. Selection of rational dispute resolution method by applying new step?wise weight assessment ratio analysis (SWARA). Journal of business economics and management, 11(2), pp.243-258.
Keshavjee, M., 2013. Islam, sharia and alternative dispute resolution: Mechanisms for legal redress in the Muslim community (Vol. 6). IB Tauris.
Khekale, C. and Futane, N., 2015. Management of Claims and Disputes in Construction Industry. International Journal of Science and Research (IJSR), 5(5).
Lumineau, F. and Malhotra, D., 2011. Shadow of the contract: How contract structure shapes interfirm dispute resolution. Strategic Management Journal, 32(5), pp.532-555.
Moffitt, M.L. and Bordone, R.C., 2012. The handbook of dispute resolution. John Wiley & Sons.
Negi, C., 2015. Concept Online Dispute Resolution in India.
Tomlinson, M. and Woodward, J., 2014. Pile design and construction practice. CRC Press.
Turner, D.F., 2014. Design and build contract practice. Routledge.
Online
Contract Variations. 2008. [Online]. Available Through: <https://www.constructionweekonline.com/article-3156-contract-variations/>. [Accessed on 21st September 2017]
Lehman, A., 2013. Construction Basics: Construction Contract Warranties. [Online]. Available through < https://www.americanbar.org/publications/under_construction/2013/august_2013/construction_basics.html>. [Accessed on 21st September, 2017].
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