Judicial Evaluation Model, Business Strategy, Contract Operational Environment and Resolution of Contractual Disputes in Road Construction Projects in Kenya

Abstract

Contractual disputes in road construction projects emanate from the fact that construction contracts create responsibilities and obligations to contracting parties. Parties are held accountable in cases of failure of responsibilities or breach of contractual obligations. Compliance is therefore routinely monitored and periodically evaluated to guarantee quality, time, and scope of projects. Parties often adopt strong positions to avoid liabilities and present conflicting evaluations in cases of schedule and cost overruns, scope overshoots and unmet quality standards. This results into contractual disputes that call for meta-evaluations. This study examined the use of Judicial Evaluation Model as an evaluation methodology for resolution of contractual disputes in road construction projects. The purpose of the study was to examine the influence of judicial evaluation model on resolution of disputes in road construction projects. The objectives of the study were; to establish the extent to which use of civil litigation process influences resolution of contractual disputes in road construction projects in Kenya, to assess how alternative dispute resolution mechanism influences resolution of contractual disputes in road construction projects, to examine the influence of judicial evaluation model on the resolution of contractual disputes in road construction projects, to determine the mediating and moderating influence of business strategy and contract operational environment respectively on the relationship between judicial evaluation model and resolution of contractual disputes in road construction projects. The target population of the study was 1,017 people drawn from project evaluation staff in roads (classes A, B and C) construction projects in Kenya. The study was founded on pragmatism paradigm which allowed for mixed method approach of investigation anchored on correlational and cross-sectional designs. A sample size of 279 was used in the study. Research instrument used was self-administered questionnaire with open and closed ended questions to collect qualitative and quantitative data respectively. Quantitative data was analyzed using descriptive statistics, correlations analysis and regression models while qualitative data was subjected to thematic analysis. Out of five null hypotheses tested, four were rejected while the study failed to reject one. With F (1,248) = 14.5, p = 0.520 > 0.05, the study failed to reject the null hypothesis and concluded that civil litigation process has no significant relationship with resolution of contractual disputes. F (1,248) = 15.4, p = 0.019 < 0.05 the study rejected the null hypothesis and concluded that alternative dispute resolution mechanism has significant relationship with resolution of contractual disputes. F (2, 247) = 13.6, p = 0.004 < 0.05, the study rejected the null hypothesis and concluded that judicial evaluation model has significant relationship with resolution of contractual disputes. F (3, 246) = 7.88, p = 0.043 < 0.05, the study rejected the null hypothesis and concluded that business strategy has significant mediating effect in the relationship of judicial evaluation model and contractual disputes. F (3, 246) = 5.48, p = 0.050, the study rejected the null hypothesis and concluded that contract operation environment has significant moderating effect on the relationship between judicial evaluation model and resolution of contractual disputes. Conclusions of the study were that litigation process is not appropriate method for resolution of contractual disputes, alternative disputes resolution mechanism leads to consensus in and reasonable cost of resolving contractual disputes, judicial evaluation model can be optimized such that alternative dispute resolution mechanism is used in the first instance and civil litigation process is used as a last resort of resolving contractual disputes. It was also concluded that business strategy influences the choice of contractual dispute resolution approach based on whether parties want long, or short-term business relationship and that contract operational environment determines selection of dispute resolution method. The study was significant because that the finding, if implemented, would help construction practitioners in choosing suitable dispute resolution methods. The study recommended structured use of judicial evaluation model prioritizing alternative dispute resolution mechanism in the first instance and civil ligation as the last resort of resolving contractual disputes. Capacity building on the use of alternative disputes resolution mechanism, being a new frontier, was also recommended. The study further recommended that parties explore business strategies that seek avoidance of disputes or advocates consensus. Contract drafters also should not be over-prescriptive on the method of resolving disputes to allow practitioners to explore various flexible methods presented by judicial evaluation model. For further research, the study has suggested a concordance analysis to optimize the model, studies on other variants on alternative disputes resolution like conciliation, review boards and amicable settlement. Replication the study to the entire construction industry and other non-construction contracts has also been suggested.