Chapter 8: Disputes and Claims


Section 1: Disputes

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A dispute is a disagreement between the department and contractor on a contract issue. Disputes may only be submitted by the prime contractor. Make every effort, within the provisions of the contract, to resolve disputes at the lowest level possible. Resolution of problems at the time as they occur generally provides the lowest cost and least time-consuming solution.

Administer highway construction contracts equitably. Promote a cooperative attitude consistent with ethical standards for contractual relationships. However, do not yield to requests from contractors solely to avoid claims.

In administering the contract, do not:

  • require the contractor to perform work outside the scope of the contract or
  • impose additional risks or costs to the contractor.

Notify FHWA when a dispute is submitted on a FLOA project.

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Partnering and Issue Escalation

Analyze issues or situations carefully and in a timely manner to determine if they are within the scope of the contract, or require more or less work than called for in the contract.

For significant deviations from the contract, negotiate change orders (COs) in accordance withChapter 7, Change Orders.

Contact the Construction Division (CST), Field Engineering Branch (FE) for assistance in resolving disputes.

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Appeals in Disputes

The contractor has the right to request an appeal of the district’s final decision. Districts may send contractor appeals to the Construction Division, Claims, Disputes and Special Programs Section (CST-CDSP) for review. Districts may take the recommendations of the appeal. CST-CDSP will provide a recommendation for disposition of the matter in compliance with the contract. Notify the contractor in writing of the final decision on the appeal. Resolution of a dispute may be accomplished with either a CO or a supplemental agreement (SA). Use a SA to settle disputes not associated with the scope of work.

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