In the usual case, problems that arise during construction are not the subject of dispute resolution until a project is substantially completed. Owners may then find that negotiated construction contract provisions with regard to required written notice of claims, contemporaneous back-up documentation, and the process for extra work and delay claims have not been followed. An owner subsequently has to deal with construction contractors’ claims of waiver of contract provisions, constructive notice of the claims, and “he said/she said” arguments in resolving disputes. In addition, the claimant contractors are on the job daily, can testify on “personal knowledge”, have contemporaneous documentation, and are usually “litigation savvy”.
In this situation, the owner may find itself at a considerable disadvantage in a construction litigation/arbitration proceedingwithout the availability of a full-time, on-site owner’s representative (an experienced construction person). The architect, who makes periodic site visits to ensure general compliance with the design documents , is generally of little help in these circumstances. In short, an owner should provide a knowledgeable, full-time representative on its construction project (a) to ensure that the contract provisions inserted for the owner’s benefit are enforced, especially those written notice and document requirements for claims; (b) to investigate claims as they happen; (c) to obtain personal knowledge as to the facts and circumstances of any problems or disputes that arise on the project; and (d) to provide daily written reports from an owner’s perspective.
The old adage that “an ounce of prevention is worth a pound of cure” is apropos here considering the costs of resolving construction claims after the fact, and the costs associated withconstruction litigation/arbitration . A full-time, on-site owner’s representative is well worth the investment on a construction project.
Source: Greenberg, Trager & Herbst, LLP