Alternative contracting strategies for controlling costs and avoiding performance disputes on remediation projects

Abstract

AbstractIt is critical that all participants in the remediation effort develop comprehensive contracting strategies aimed at controlling remediation costs and avoiding performance disputes. Initially, greater emphasis should be placed on negotiated, cost‐type contracts that fairly address the allocation of risk between contractor and owner. This article examines the use of this contracting method and discusses industry studies on contract risk allocation, reviewing several typical contract clauses. Moreover, the participants in the remediation process should commit to the use of partnering as a framework for contract performance, as well as alternative dispute resolution techniques to swiftly settle disagreements. Through partnering, the owner and contractor work cooperatively throughout performance, rather than focus solely on their contractual rights and remedies. The article examines the mechanics of the partnering process, identifying the critical stakeholders as well as potential pitfalls, and relates industry applications. Relying on an extension of the partnering concept to the resolution of performance disputes, alternative dispute resolution (ADR) techniques are designed to encourage negotiated settlements of disputes. The article examines various ADR methods, including the use of a dispute escalation network, job‐site dispute resolution, and post‐performance ADR techniques.