National survey shows rise in disputes

Latest News Tue, Mar 22, 2016 5:26 PM

National survey shows rise in disputes

A survey of the UK construction industry by NBS, part of RIBA Enterprises, has revealed an increase in the number of disputes over the last 12 months.

Undertaken with the help of the membership of more than 20 industry bodies, the 2013 NBS National Construction Contracts and Law Survey of more than 1,000, clients, contractors and consultants found that 30% had been involved in one or more contract entering into dispute in the last 12 months compared to 24% in the previous year, with 7% reporting that they had been involved in three or more disputes.

The perception that the tough economic climate has forced parties to be more adversarial is backed up by nearly half of those surveyed saying that the number of disputes have increased (and fewer than ten per cent that are saying they have decreased), with consultants reporting that over the past few years the number of non-paying clients, and clients going bankrupt, has dramatically increased.

It is also clear from the NBS survey that many disputes involve large sums of money and have a significant effect on the construction process. The survey found:

  • Half of the disputes reported had a value greater than a quarter of a million pounds, whilst 13% had a value in excess of £5 million.
  • 70% of disputes occurred during the construction process, the remainder happening after practical completion, with 17% of disputes resulting in work being stopped or suspended.
  • 45% of those who entered into dispute in 2012 had at least one on-going dispute at the time they completed the survey (June and July 2013).
  • Disputes most commonly arose between the client and main contractor (81%) with the assessment of delay and extension of time and contract variations cited as the primary causes of contention.

The survey also revealed how international work (through UK-managed contracts) brought its own issues with cultural differences coming top followed by risk distribution, unfamiliar contract forms, security of payment and language issues, listed as challenging issues for at least a quarter of those involved in international contracts.

Those calling for greater collaboration in the construction industry will also be disappointed to learn that nearly a half of respondents did not adopt any collaborative techniques in 2012, and only 10% did so for all projects.

Almost half of those questioned felt that greater collaboration between all parties was helped by the adoption of BIM (only 6% didn’t) but it is still not normal practice for BIM to be referenced in contracts, with fewer than a quarter agreeing that they referenced BIM, or have adopted BIM, in their contracts.

Richard Waterhouse, Chief Executive of NBS’s parent company, RIBA Enterprises said: “Further work is required to develop knowledge on how to improve and create effective contractual mechanisms that provide the framework for collaboration in construction projects

While disputes appear to be increasing, use of industry standard contract forms is not. Bespoke contracts and appointment arrangements remain prevalent. The survey gives us no evidence to support the view that bespoke contracts are a way of avoiding dispute.”

Featured News

Specification news
Photography contest to showcase the best of the...

Photographers who showcase the beauty of the built environment are set to go...

Read More >>

Specification news
Paul Newman appointed as technical director for STA

The Structural Timber Association (STA) is pleased to announce that it has appointed...

Read More >>

BUILDING PRODUCT LIBRARY - LATEST BROCHURES

Novantica - Cement Free Restoration  Brochure

Novantica - Cement F...
By Fassa Bortolo

Download Now >>

Fassatherm System - Product Catalogue  Brochure

Fassatherm System -...
By Fassa Bortolo

Download Now >>

Fassarend System - Product Catalogue  Brochure

Fassarend System - P...
By Fassa Bortolo

Download Now >>

Fassalime System - Product Catalogue  Brochure

Fassalime System - P...
By Fassa Bortolo

Download Now >>

Sport England’s Performance Archery Centre Brochure

Sport England’s Perf...
By Passivent

Download Now >>

BUILDING PRODUCT DIRECTORY - LATEST PRODUCTS

Straightcurve®
Straightcurve®

Straightcurve® – headquartered in Australia, is renowned for high-end innovative garden edging,...

Read More >>

RLG600 Access Flooring System
RLG600 Access Flooring System

The Kingspan RLG600 raised access floor panel is intended for light office use and is capable of...

Read More >>

RHG600 Simploc
RHG600 Simploc

Kingspan RHG600 Simploc is the heavy grade floor system, capable of handling up to a 12kN/m2...

Read More >>

CONSTRUCTION VIDEOS - LATEST VIDEOS

Discover the first-ever reference book for stone wool insulated sandwich panels
Discover the first-ever reference book for stone wool insulated sandwich panels

“Building with stone wool insulated sandwich panels” written by Professor Imperadori, is now...

Watch Now >>

Portakabin | Installation at the iconic Admiralty Arch, London
Portakabin | Installation at the iconic Admiralty Arch, London

Portakabin | Installation at the iconic Admiralty Arch, London

Watch Now >>