Impact of various construction contract clauses

Construction contract types and general condition clauses have a major influence on the likelihood and degree of project success. A comprehensive empirical study was conducted for 36 very large capital construction projects completed within the past three years to assess such impacts. Two general contract types (cost reimbursible and fixed price) and 96 clauses were carefully analyzed for impacts on six measures of project performance: cost, schedule, quality, safety, and owner and contractor satisfaction. The clauses bearing most heavily on project performance are identified, and the key elements of those clauses that are most crucial to project success are discussed in detail. Other contract administration concepts such as risk allocation, respective views of owners and contractors, and incentive provisions are factually and thoroughly discussed.