Disputes over contract performance occur when a contractor and owner disagree on terms, interpretation, or compliance.

Disputes in contract performance: what they are and why they show up on sanitary engineering projects

On a project like a water treatment plant, a sewer rehabilitation job, or a large stormwater network upgrade, disagreements between the contractor and the owner are almost inevitable. When those disagreements grow hot enough to affect how the contract is carried out, they’re called disputes. It’s a formal term for a kind of disagreement that rides along with the language of the contract, the schedule, and the budget.

Let’s untangle the vocabulary a bit. People toss around terms like disputes, negotiations, conflicts, and concerns. They’re related, but they don’t all mean the same thing.

• Disputes are formal disagreements about how contract performance should be interpreted, measured, or paid.

• Negotiations are the back-and-forth talks aimed at resolving those disagreements, often before they escalate.

• Conflicts can be broader—sometimes about goals, priorities, or relationships, not only what the contract says.

• Concerns are worries or apprehensions that may or may not grow into a formal dispute.

Think of it this way: disputes are the core disagreement; negotiations are the dance to settle it; conflicts are a wider tension; concerns are the early warning signals. In the world of sanitary engineering, the lines matter because contracts, permits, and specifications drive every decision from dig to discharge.

What exactly triggers a dispute?

Disputes usually pop up when there’s a gap between what the contract says and what actually happens on site. A few common triggers in sanitary projects include:

• Interpretation of contract terms. Sometimes the same clause means something different to the owner and the contractor. Did the contract require a certain NTL (notice to proceed) standard for unforeseen site conditions? Was a particular testing method specified? Small wording can lead to big disagreements.

• Scope changes and extra work. A buried utility is found, or a new regulation requires a different treatment process. Who pays for it? Is it a design change, an added scope, or a deviation to the original plan?

• Delays and schedule pressure. Weather, supply chain hiccups, late submittals, or a design delay can push a milestone. Who bears the risk? Is there a liquidated damages clause? How do we extend the schedule fairly?

• Costs and pricing. If a price increase is claimed for equipment, materials, or labor, the parties need a clear basis—what’s included, what isn’t, and how the change gets documented.

• Quality and compliance. If what’s installed doesn’t meet the specs, or if the finished work violates safety or environmental requirements, you’re staring at a potential dispute about acceptance criteria and conformity.

• Documentation gaps. In complex infrastructure work, a missing RFI response, an incomplete submittal, or a skipped field test can ignite disagreements about whether performance criteria were satisfied.

In practice, a dispute often unfolds like this: a claim is made (for example, a cost claim or a schedule impact), it’s evaluated through the contract’s problem-solving channels, and if the parties can’t reach agreement, the matter may move into mediation, arbitration, or litigation. On a real project, you’ll hear terms like “change orders,” “claims management,” or “dispute resolution procedures.” The exact path depends on the contract form your project uses—FIDIC, AIA, NEC, or a custom owner-contractor agreement—and the governing law.

Two or three fresh ways to think about it

• Disputes aren’t just about money. They often hinge on timing, scope interpretation, and whether the work performed aligns with the specified performance criteria. In sanitary projects, a delayed or misaligned discharge permit can be almost as painful as a cost overrun.

• Not every disagreement is a dispute. If both sides are talking, sharing data, and working toward a solution, you’re in the negotiation zone. A dispute becomes formal when there’s a claimed breach or an unresolved interpretive gap that triggers a contract remedy.

• Documentation is sword and shield. Daily logs, RFIs, submittals, change orders, photos, and test results aren’t just busywork; they’re the ammunition and the armor for resolving disputes.

How disputes get resolved (and why the path matters)

Most contracts lay out a staged approach to handling disputes. The stages are not random; they’re designed to keep project momentum while giving the parties time to reason, gather facts, and find common ground.

• Informal discussions and site meetings. The first step is almost always a direct conversation between the project manager, superintendent, or design lead on both sides. Often, a telephone call or a short meeting clarifies the interpretation of a clause or the impact of a field condition.

• Written notices and documentation. If a disagreement remains, parties lean on formal notices, RFIs, and change orders to anchor the conversation in contract terms and project data. This creates a clear paper trail.

• Negotiations. When interest aligns enough to settle, the teams negotiate a settlement, often with a defined timeline and a concrete plan for implementing the change and adjusting the schedule and cost.

• Mediation. If talks stall, a neutral mediator can help the parties find a middle ground without stepping into a courtroom.

• Expert determination or arbitration. Some contracts call for an independent expert to decide on technical points, or for binding arbitration to resolve the financial aspects of a dispute.

• Litigation. That’s the last resort, used when all else fails and a court settlement or judgment is needed.

Staying practical on real projects

In sanitary engineering, where the consequences of delay or missteps ripple through public health and environmental compliance, a calm, methodical approach matters. The aim isn’t to win, but to reach a fair resolution that keeps the project moving and preserves safety and quality.

• Keep the data clean. Quality data—schedule baselines, daily reports, testing records, and material certificates—beats best guesses every time.

• Agree on an objective standard. Make sure everyone understands how the contract defines performance, acceptance criteria, and what constitutes “substantial completion.”

• Build in early dispute-resolution mechanisms. If you’re involved in the contractual setup, install a simple flowchart for disputes, with transparent timelines and a designated decision-maker (or panel) for technical questions.

• Use modern tools. Project management platforms like Procore or PlanGrid help organize RFIs, submittals, and change orders. Scheduling tools like Primavera P6 or Microsoft Project keep the critical path under watch. When data travels cleanly, so do the decisions.

A few practical, project-tested tips

• Document conversations with purpose. A quick email summarizing a meeting’s outcomes can save hours of back-and-forth later.

• Tie claims to contract language. If you’re asserting a cost or time impact, root it in the specific clause, the scope, and the record of change or delay.

• Treat disputes as a risk you manage, not a battle you fight. The quicker you move toward a constructive resolution, the less time and money you waste.

• Favor collaborative problem-solving. Approach disagreements as joint problems to solve rather than a contest of who’s right.

• Align the team. Ensure site leadership, the PM, the engineer, and the superintendent are all on the same page about the performance standards and the reporting process.

A quick glossary for field and office conversations

• Disputes: formal disagreements about how the contract is interpreted or performed, often with potential remedies.

• Negotiations: the back-and-forth discussions aimed at settling disagreements.

• Conflicts: wider tensions that can include organizational or relational issues, not solely contract terms.

• Concerns: worries that may or may not materialize into formal disputes; early flags that something could go wrong.

Let me explain with a quick analogy. Imagine you’re building a neighborhood’s new wastewater treatment line. The plan calls for a certain depth of trenching, a specific soil condition assumption, and a set of performance tests for the new pump. If the soil ends up rockier than anticipated, the contractor asks for extra digging time and extra earthwork, and the owner wonders if rock conditions were correctly budgeted or if the design team should have anticipated them. The first move is a conversation between the contractor and owner. If they settle on a change order and a revised schedule, fine. If not, they might bring in a mediator or an independent expert to interpret the contract language and the field data. The goal isn’t to antagonize; it’s to keep the project moving while preserving safety, quality, and cost control.

In the bigger picture, disputes in sanitary engineering projects aren’t signs that someone did something wrong. They’re a natural byproduct of complex, multi-party undertakings with evolving site conditions, finite budgets, and strict regulatory demands. What matters is how quickly and fairly the parties can move from disagreement to resolution—and how smoothly they can keep the essential work moving forward.

A final thought

Contracts are living documents on a project site, and disagreements will arise when plans meet reality. The more you know about the nature of disputes, how they differ from negotiations, conflicts, and concerns, and the practical steps to resolve them, the more confident you’ll be on the job. Build your project toolkit with strong documentation habits, clear contract language, and proactive communication. Pair that with smart use of scheduling and document-management tools, and you’ll navigate disputes with less friction and more focus on delivering safe, reliable sanitary infrastructure.

If you’re navigating this field, you’ll hear a lot about the practical side of contracts: who signs, what gets changed, and how the project keeps its momentum. Remember, the heart of it is simple—disputes are formal disagreements about contract performance. The better you handle them, the more you protect the project’s health, the team’s morale, and the community’s wellbeing.