Force majeure in construction
Force majeure is a French term meaning 'superior force', denoting an 'act of God'. Simply, it refers to extraordinary, unusual and unforeseen events beyond the practical control of an individual or group to a contract that prevents a party from fulfilling an obligation or obligations arising from that contract. Typically, this event is something that one party to a contract could not fairly avoid or reasonably attribute to another party. Depending on what the contract stipulates, the following could most likely be considered force majeure:
- unexpected changes in legislation(s)
- wars and other conflicts such as terrorism
- exceptionally unfavorable weather conditions
- civil unrest, such as demonstrations, strikes, or riots
- fires
- natural calamities like earthquakes, floods, volcanic eruptions
- epidemics or pandemics.
In construction, force majeure clauses are intended to establish to which situations the term applies, together with recommendations on how such circumstances should be handled. Some contracts consider force majeure as a material event that may grant the contractor the ability to submit claims within an extended period of time necessary to fulfill its contractual obligations.
While clients typically reach settlements with contractors when they are unable to perform their work when a genuine force majeure arises, problems arise when a client suspects that the contractor is claiming an unjustified force majeure for monetary gain and that the situation could easily have been predicted, avoided or moderated. . These claim disputes are common, especially when it comes to adverse weather, as the term is loosely defined.
The importance of preparation in construction
As force majeure events are defined as unforeseen events, the best way to deal with them is to prepare for any worst-case situation. By being prepared, you also mitigate related issues and avoid disputes that may arise.
Unforeseen problems that arise on site can be avoided and the problems they cause can be mitigated through better preparation around:
- Requests
- Deliveries
- Decisions and choices
- Designs
- Crew schedules
Being prepared for force majeure events allows you and your team the flexibility to pick up where work left off and continue your construction contract for an extension of time. Being better prepared, however, may even mean continuing with construction without needing to extend the deadline.
So how can one prepare for unforeseen events? For example, a strike halted your construction project because civil unrest caused so much traffic that your suppliers were unable to deliver your prefabricated elements on time. By having your team communicate in a central location, you can immediately update your suppliers and their on-site teams about what deliveries to expect at what time, and communicate with the specific team responsible for receiving prefabricated elements at what time. they need to be ready. location while notifying all other teams of the delay. Thus, mitigating even more delays and saving time and labor resources that would no longer be needed that day. Having the ability to bring all involved parties together in one place to find a solution together ensures a proactive approach to project preparation and resolving constraints.
How to protect your construction projects against unforeseen events
Unforeseen events do not have to cause disasters. Here are five ways you can prepare your project for any unforeseen events.
1. Communicate with all project stakeholders before the project begins
Before starting your project, you must communicate to all project stakeholders the overall plan and schedule, including your preparation plans and clauses that address specific situations that may arise. Establish a communication and collaboration protocol that makes it easy for project stakeholders to access the latest documents.
2. Define in detail which events are force majeure and establish how they should be handled
As a project manager, one of the things you need to clearly define are the details surrounding events that fall under force majeure. As these events tend not to be clearly defined, it is best to include parameters that can help interested parties determine whether a force majeure event is genuine or not. Don't forget to include instructions on how each specific event should be handled.
3. Connect all teams, team members and subcontractors around a live, shareable version of your program
Connecting your teams, contractors and subcontractors in real time offers the advantage of mitigating any risk associated with an unforeseen event. Everyone is kept on the same page, allowing them to understand changes as they happen, giving everyone the flexibility to adjust in real time. Having teams connected to the right project information allows you to make better, faster decisions. Mitigate the risks of unforeseen events with up-to-date and accurate data communication.
4. Connect your schedules through integrated planning
Having your short-term schedules integrated into overall planning gives you full control and visibility to manage your construction priorities. This schedule transparency allows you to understand what is currently happening on the project, and for any unforeseen events, you always stay ahead and resolve potential risks and issues before they turn into something harmful. Predict events, identify possible problems and avoid their impact on your budget and schedule. Avoid unforeseen surprises with better project control and visibility.
5. Standardize as much as you can
Standardize your work process, standardize your communication, standardize your documentation and easily learn from your data insights and apply best practices in your future projects. By standardizing as much as possible across your project, you create valuable project data that you can learn and improve from. You can then align your best practices and optimize your workflows across your projects. This allows for accurate estimates to avoid unnecessary risks and predict unforeseen events, protecting your project against unexpected costs, delays, downtime and potential disputes.
Protect your project from force majeure
As a construction professional or project manager, it is essential at the beginning of any project that you review your construction contract and determine your rights and obligations in relation to the entire project and in the context of a force majeure event. This initial information should guide you on what to prepare for and what to watch out for to avoid claims disputes.
