Over my twenty years as a construction litigator, I have observed firsthand the explosive growth of claims in this industry. Even with alternative dispute resolution procedures commonly in use today, such as mediation and arbitration, the frequency and volume of claims has not diminished much, especially in the public sector.
Nonetheless, one approach has began to prove itself as a means to prevent and resolve conflict — Partnering.
Partnering is not a formal or structured procedure. Rather, it is a way of doing business founded on fundamental principles of teamwork. The best definition I have seen comes from Charles E Cowan, the former Portland district commander of the Corps of Engineers and now the director of the Arizona DOT:
Partnering is a new paradigm of owner/contractor relations with emphasis on up-front team building, clear definition of common objectives, synchronized systems for rapid issue resolution and frequent joint evaluation of partnership effectiveness.
Partnering works not only to resolve conflicts, but to prevent them by effectively eliminating the opportunity for adversarial altitude to lake control when problems arise. The process is remarkably simple. It starts with key representatives of the project participants (owner, A/E's, contractor, and subcontractors) meeting shortly after contract award. This gives them a chance to cut through the detailed contract requirements, to discuss each participant's project objectives and concerns and to focus on solutions. This helps open channels of communication, and helps build a team attitude.
Out of this initial workshop, the participants establish a common mission statement or charter selling forth the specific goals and objectives agreed upon. This Partnering charter is not legally binding; its value depends entirely on the will of the participants to make it work. Vital elements of Partnering are the willingness to elevate unresolved problems to the next higher authority, and to continue to evaluate the project to assure the pre-defined objectives are being met.
My introduction to Partnering came somewhat as a shock. In midyear 1990, one of our clients, a subcontractor, was experiencing exceptional difficulties in placing soldier piling, tiebacks, and whalers on a large Corps of Engineers lock and dam job on the Columbia River. Dutifully, the subcontractor (with our assistance) set out to give notice and to document and prepare claims as the contract required. In the early fall, my client and I were summoned to meet with the prime contractor, who advised us that the project was being administered under The Partnering concept; accordingly, we should cease writing letters and participate in the process. Having represented contractors on scores of claims against the Corps, I was most suspicious and so was my client. What was described as Partnering sounded far too idealistic. However, the stakes were so serious that my client saw little alternative.
Within a few weeks Partnering began to produce results. Engineers for the Corps met at length with the contractors and resolved many of the technical problems through value engineering and by relaxing specifications incorporating excessive design requirements. The Corps wisely recognized the benefit in making compromises in order to assure that big scope objectives (timely completion within budget) were met. These measures did not fully resolve the claims, and the requirement remained to document and substantiate the recovery of the cost overruns in accordance with the contract and' applicable federal regulations. However, the Partnering process ensured that project objectives received priority, good working relationships prevailed, and that the claims could be compiled, presented, and resolved in a non-adversarial setting.
A few months after my introduction to Partnering, Col. Cowan invited me to his office to explore my reaction to Partnering. From that meeting and numerous subsequent dealings, Cowan has proven himself to be truly a unique and gifted individual. For years the Corps has been trying to nurture Partnering in its contracts to stem the tide of delays and claims plaguing the entire federal contracting system. However, it took the leadership of this person to put the concept to work successfully. Today, the Corps openly endorses Partnering throughout the nation and beyond, but the Portland District is its main source of proven success. I left that meeting with the colonel inspired to do what I could to help promote this important concept. I saw our State DOT as the most applicable candidate.
As a result of my urging, the AGC invited Cowan to address a group of contractors and state and local government construction officials this spring in Seattle. WSDOT, which has received national acclaim for its success with the Disputes Review Board procedure, had already begun to seriously investigate Partnering. Cowan jump-started the process, and today WSDOT is successfully using Partnering on its major projects. Just recently, the University of Washington began inserting Partnering provisions in its contracts.
It is disheartening to watch the remarkable waste of engineering and construction expertise in confrontations created by claims. In the last two decades, we have witnessed this on virtually every major public works building project in Seattle; the Kingdome, King County Jail, Convention Center, and now Seattle Art Museum and Mercer Island Floating Bridge. Partnering can and will stop that.
To succeed, Partnering requires a champion. After so many years developing the litigious attitudes existing today, it will not be easy for the industry to suddenly shift to a concept based on teamwork. People such as Cowan and Norm Anderson, chief engineer for WSDOT, are required to-commit to the Partnering process and have the leadership capability to convince others in their organizations of its merit. Partnering must be adopted by senior management, and APPLIED in the field. Lack of project level authority and/or the ability to make prompt decisions definitely contributes lo litigation. However, regardless of bureaucratic red tape so frequently a factor in public works construction, owner representatives are much more prone to make decisions if they know that the problem will and should be referred upstairs. That is particularly so under Partnering, because it discourages dilatory decision making.
The above raises two compelling questions. What does all this mean for the legal profession? Why would a lawyer endorse a concept aimed at reducing litigation? The answers are quite straightforward. The dispute resolution potential of Partnering means that the role of lawyers in construction will change and be used more for prevention and less for repair. When so employed, there will not necessarily be less work for attorneys; rather, attorneys can and should be used more for their analytical and negotiating skills in avoiding conflicts and/or finding settlement alternatives to litigation. My colleagues recognize that excessive litigation is bad for the industry and what is good for the industry is also good for our profession. No doubt, good-faith disputes will remain, even on Partnering projects. Also, unscrupulous and unreasonable elements in the construction industry will make resort to the courts necessary. However, Partnering promotes a positive/constructive working relationship, which is something that seldom, if ever, ends up in court.