In the construction industry, public and private projects differ from each other not only in their procurement process and contractual requirements but also in their dispute resolution methods. In general, public projects are subject to more laws or regulations, whereas private projects offer more flexibility.

Even at the outset of the claim process, public projects may have specific limitations and protections that can affect the timeframe within which claims can be made. In contrast, private projects may allow for longer timeframes, depending on the specific project’s contractual agreements. Similarly, public projects may be more strict with respect to how claims are submitted, requiring rigorous documentation standards and adherence to specific timelines and formats. In contrast, private projects may allow for more flexibility, depending on the provisions of the specific contractual agreement.

During the claim process, laws and regulations may limit public projects in their available dispute resolution procedures to only mediation, arbitration, and litigation. However, private projects can allow for greater flexibility in dispute resolution procedures, also permitting alternative dispute resolution methods (ADR) such as dispute review boards or Early Neutral Evaluation (ENE). Essentially, the claims process in private projects is limited by their contracts, which were written with fewer law- or regulation-imposed limitations than contracts in public projects.

Public and private construction projects also differ in the types of consequences that their parties potentially face during or after the claims process. For example, in a private project, if a party does not pay a contractor, the contractor may have the right to lien the property. However, such lien rights are typically not available in public projects, or might only be available with limitations, depending on the region. Additionally, consequences for inaccuracy in claim applications can be much higher in public projects, given additional regulations against submitting false claims to government entities.

Given the differences between public and private construction projects across the entire claims management process, it is important to prepare for claims with knowledge of those differences. However, despite their differences, both public and private construction projects do have great similarities with each other as well. Whatever the construction project, it is generally helpful to have early identification and resolution of potential issues, thorough documentation, and attitudes of genuine collaboration.