Avoiding Disputes in the Design-Build Environment - Chapter 2 - AAA Handbook on Construction Arbitration and ADR - Third Edition
Michael C. Loulakis
Michael C. Loulakis is President of Capital Project Strategies, LLC, a consulting firm that specializes in advising clients on procurement and contracting strategies, particularly on projects delivered through design-build. With over 30 years of experience of construction industry experience, Mr. Loulakis received a B.S. in Civil Engineering from Tufts University and a J.D. from Boston University School of Law. He is widely published in the area of design-build, and has written several books on the subject, including DESIGN-BUILD: PLANNING THROUGH DEVELOPMENT, (McGraw-Hill Publishers 2001).
Many owners turn to the design-build delivery system because they want to avoid disputes.1 The standard form design-build contracts for owners and design-builders published by the Design Build Institute of America (DBIA), a Washington, D.C.-based trade organization that promotes design-build delivery systems, contain dispute resolution provisions that call for both binding and nonbinding dispute resolution methods when disputes arise.
The advantages of these dispute resolution processes are discussed below. But as this chapter also demonstrates, through creative contracting and administration of both the prime design-build contract and the contracts between the design-builder and its team members, the parties can minimize and perhaps avoid disputes altogether.
II. What Is Design-Build?
In a design-build project, the design-builder is contractually responsible for completing both the design and construction of the project—regardless of how many subcontractors (including architects and engineers) it will rely upon to carry out these tasks. Thus, all architectural, engineering and construction services are covered in a single agreement between the owner and the design-builder.