Dilemma Of Construction Payment Disputes

Dilemma Of Construction Payment Disputes

The property boom is in direct correlation to the construction business. Where the Singapore’s government has been quite effective in implementing laws that help in the island’s prosperity, it has worked on effectively resolving the construction payment disputes without greatly affecting the cash flow involved.
Singapore is only one of four countries that actually have a proper legal act to help all the parties involved in a construction.

When a construction takes place it is all too common to expect from either of the properties involved. It can be between a contractor, a construction company, or a customer getting it done. Mostly it is lack of payment delivery on time; however it can be related to unsatisfactory work also.

People involved however have evolved effective ways to resolve the dispute other than litigation. A legal trial in the end helps nobody as it costs a lot of money and time of the parties involved. And sometimes the cost to get a construction dispute resolved is higher than the one involved for the completion of task.

Lately construction parties have attached a “mechanic’s lien” to the property when the work agreement starts. According to this act if the party getting the work done fails to pay for the services asked then the matter is taken to trial and if the dispute is not resolved or settled before final agreement then it might require to sell the property to pay for the expenditure.

Singapore Mediation Centre (SMC) was evolved to resolve disputes without further complications. The mediation centre hosts around 134 adjudicators that help settle the case. These adjudicators are well trained and help settle disputes while the work still goes on at the site. Which means contrary to the earlier practice, when a lot of time and money was wasted to first get the disputes settled and then progress with the work, now work can go on as it is without being effected and the issue can be dealt with on the side?

In retrospect other ways have also been devised to settle the disputes that don’t involve courts. These involve arbitrators. Many a times the agreement made between two parties holds the clause that in case of a dispute the matter will be settled with the help of an arbitrator. If someone is against this, they have to get that clause out at the time of agreement otherwise he is legally bound.

Arbitration is a less formal trial, though the parties can take help from their legal attorneys it does not involve going to court. The arbitrators belong to a neutral party. It listens to both parties and then comes t the decision. Another way of resolving matters is by the help of mediators. The mediators also belong to a neutral party, but unlike arbitrators they don’t make the decision instead help provide options to both the parties as to how they can come to a resolution.

All these ways that have been developed in the end are productive to country’s economy. And reports have said that as per statistics the construction disputes have decreased since last year and have also devised a way to resolve them quickly.

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Mindy Yong

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Mindy@MindyYong.com

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