Construction Dispute Prevention Toolkit: Checklists and Guidance for Project Teams
- Stuart Lawrence
- Apr 3
- 3 min read
Updated: Apr 7
Contents
Construction Dispute Prevention: How to Use This Toolkit
This section brings together practical tools and commercial guidance to help:
Identify risk early
Strengthen contract positions
Reduce the likelihood of disputes
Support better decision-making during projects
These tools are designed to be practical, not theoretical.
Pre-Contract Construction Risk Checklist
Use this checklist before entering into a contract or during final contract review.
Scope of Works
☐ Is the scope clearly defined and fully documented?
☐ Are all deliverables specifically described?
☐ Are exclusions clearly stated?
☐ Are assumptions recorded and agreed?
☐ Are maintenance obligations separately identified and priced?
Contract Documents
☐ Have all contract documents been reviewed (including referenced documents)?
☐ Is there a clear order of precedence?
☐ Are inconsistencies or ambiguities resolved?
☐ Are clarifications incorporated into the contract?
Risk Allocation & Liability
☐ Is liability capped at a reasonable level?
☐ Are indirect/consequential losses excluded?☐ Are there any uncapped risks?
☐ Do obligations align with insurance cover?
Liquidated Damages (LADs)
☐ Are LADs capped in time and value?
☐ Are they a genuine pre-estimate of loss?
☐ Are they the sole remedy for delay?
☐ Are milestone LADs structured fairly?
Payment Terms
☐ Are payment triggers clearly defined?
☐ Are payment timeframes reasonable?
☐ Are withholding provisions clear?
☐ Is there a right to suspend for non-payment?
☐ Is retention proportionate and releasable?
☐ Are the payment provisions compliant with the Housing Grants, Construction and Regeneration Act 1996 (including payment notices, pay less notices and suspension rights)?
Programme & Time Risk
☐ Is the programme realistic?
☐ Are dependencies clearly identified?
☐ Are approval timeframes defined?
☐ Are sequencing assumptions agreed?
☐ Is contingency included?
Variations
☐ Who can instruct variations?
☐ Is valuation clearly defined?
☐ Are changes recorded and agreed promptly?
Letters of Intent (if applicable)
☐ Is scope clearly defined?
☐ Is there a price cap?
☐ Is there a time limit?
☐ Is there intent to enter into a full contract?
Insurance & Guarantees
☐ Does insurance match contractual requirements?
☐ Are cover levels sufficient?
☐ Are bonds proportionate and time-limited?
☐ Are “on demand” bonds understood?
Final Sense Check
☐ Are all key risks identified and understood?
☐ Have risks been priced or mitigated?
☐ Are any assumptions unresolved?
☐ Has appropriate legal/commercial review been carried out?
☐ Have you considered whether early mediation could resolve issues before escalation to adjudication?
Market Practice – Liquidated Damages
Should represent a genuine pre-estimate of loss
Typically capped, often in the range of 5–10% of the contract sum
Should be time-limited
Ideally the sole remedy for delay
Market Practice – Liability
Liability should be reasonable and proportionate
Often linked to:
contract value
available insurance
Indirect / consequential losses typically excluded
Uncapped liability presents significant risk
Letters of Intent – Minimum Safe Position
Where letters of intent are used, ensure:
Clear scope of works
Defined price cap
Time limitation
Payment mechanism
Clear intention to enter into a full contract
Adjudication – Practical Reality
May not provide final resolution
Can lead to multiple proceedings
Increasing use of “true value” challenges
Mediation often provides a more efficient and commercially effective outcome.
How Mediator Locator Can Help
Mediator Locator provides access to experienced construction mediators across the UK.
We:
Match the right mediator to the dispute
Understand both legal and commercial context
Focus on efficient, commercially driven outcomes
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