Practical interpretation of the contract also helps

3.19  The main reason for disputes arises from the interpretation of the contract (Figure 4, page 9). A number of contractors believe that authorities are being inflexible and are not taking a practical approach to the interpretation of the contract. Differences will be minimised if authorities and contractors have discussed and documented how contractual terms are to be interpreted before the contract is let. Where differences in opinion do subsequently arise, authorities need to assess whether the issue is sufficiently important that it merits the authority continuing to argue for its interpretation to be accepted or, on less significant

matters, whether it would be better for the relationship to reach a pragmatic compromise with the contractor. In other situations authorities and contractors will wish to consider agreeing amendments to the contract where they both see this as beneficial to the long term objectives of the project.