Disputes between main contractor and subcontractor: Causes and preventions

Abstract

Disputes free subcontract is a key to success of modern construction industry which largely depends on subcontracting. Since this effort has to be made on the expense of time and cost, which can be used otherwise to add more value to the project, it is vital to decide an effective mechanism to mitigate subcontract disputes. Considering the need for addressing this fact, this paper aims to investigate causes of subcontract disputes and effective prevention measures. Mixed approach was followed in order to achieve the aim of the study. Thus, a preliminary survey was conducted to validate literature findings and a questionnaire survey was carried out with contractor and subcontractor representatives to identify causes of subcontract disputes and prevention measures. The findings of the preliminary survey were analysed using content analysis technique and data captured through questionnaire survey was evaluated using relative important index and weighted mean. Incompleteness of the contract was identified as the primary reason of disputes in subcontracts. Further, financial issues, risks and uncertainties, collaborative conflicts, opportunistic behaviours of contracting parties and wrong practices also have a significant impact on occurrence of disputes. Proper contract management and proper site management which includes scheduling and effective project management practices were identified as the most effective prevention measures. The contract administrators should identify the things they should necessarily address in the contract and project managers in dispute prevention regards should consider time and cost constraints to prioritize effective prevention measures.