Disputes and Claim Management during the COVID-19 Crisis: The Lessons Learned

Abstract

The COVID-19 crisis has presented the construction sector with challenges that the world has never seen before. Productivity is down, costs have increased, conflicts and claims are increasing, delays are high, health and safety practices are increasing, and profit margins have been reduced. The challenges require unprecedented, sudden, and unplanned changes to construction management practices and strategies. Through an open-ended survey questionnaire, this research investigated how COVID-19 causes disputes in construction projects and the measures that quantity surveying firms take to resolve the disputes in construction contracts due to the pandemic. The data revealed that disputes and claims have increased by some 80% due to the COVID-19 pandemic. In addition, the data revealed that the COVID-19 pandemic has increased project costs by more than 40%. Shortages of materials, compliance with standard operating procedures, social distance, fluctuation, and shortages of labor are the causes of disputes. Unlike prior to the COVID-19 crisis, disputes are not caused by variations, ambiguous contract clauses, mistakes, errors, and competencies of the parties to the contracts. To resolve COVID-19-induced claims, contract clauses, negotiations, conciliation, trust management, and contingency provisions are the most effective. This research provides new information on claim management during a crisis. From an ontological standpoint, the main findings of this study are generalizable to construction projects in and outside of Nigeria.