Mediated
Contract Negotiation
JAMES H. KEIL
ABSTRACT
Country:
U.S.A.
Language:
English
Using the typical negotiation process for construction contracts as an example, parties to the contract are very likely to have other financial considerations in mind as they negotiate. The owner, for example, may want this contractor (or designer) to be a contender for follow-on projects, or later phases in this project, or the exact opposite may be true. In either case, these underlying considerations very often cause negotiation points to be presented less directly than would be in the best interest of performance in this contract.
The contractor, in most cases, wants to preserve his relationship with the owner in order to remain viable for follow-on contracts or work, and, as a result, very often is unwilling to hold firm to a position for fear of jeopardizing this future relationship.
Neutrals can help to bring attention to these issues by all of the parties, and assure that they are presented in a less contentious environment. The net result of the use of construction neutrals in the negotiation of contracts is clarification of issues through improved inter-disciplinary communication. These improvements bring savings through improved contract performance, less disputes, and better turn-around on the construction of the project.
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