Association between Construction Contracts and Relational Contract Theory: Fid-Bau Portal

Association between Construction Contracts and Relational Contract Theory

Harper, Christofer M. / Molenaar, Keith R.

Construction projects primarily use three conventional delivery methods: design-bid-build (DBB), design-build (DB), and construction manager/general contractor (CMGC). Integrated project delivery (IPD) is an emerging delivery method that emphasizes the relational aspect among multiple organizations. It defines success by the outcomes of the project, not the individual organization's outcomes. This is a culture change for the construction industry as IPD attempts to assimilate organizations as a team to focus on the project goals. This study examines the association between project integration and contracting relationships using relational contract theory behavioral norms. Relational contract theory states that long-term contracts are complex and that the interactions, communication, and understanding among contracting organizations are the most critical and intricate aspects to the success of a contract. Contractual behavior norms are the expected behaviors occurring among contracting organizations, which can "make or break" a project. To determine the connection between project integration and relational contracting, this study uses a content analysis to investigate standard construction contract language for the existence and frequency of contractual behavior norms. The results of this exploration illustrate that behavior norms exist in construction contracts, construction contracts generally are relational in nature, and IPD contracts are more relational than DBB, DB, and CMGC contracts.