In case contractors needed confirmation that the words in a contract delay clause have the power to darken or brighten their thoughts and moods, here it is.
Chicago researchers have found a link between contract terms and human emotions, and say that perceptions of words may also help practitioners decide whether to work with a new owner or look for other clients.
Cindy L. Menches, an assistant civil engineering professor at the Illinois Institute of Technology in Chicago, and graduate student Lawrence Dorn, gave surveys to 27 students and industry pros in a construction management class at the school to determine what subtle emotional responses they would report after reading the language of four different contract delay clauses.
All the selected clauses, from model contracts provided by the American Institute of Architects, the city of Chicago, ConsensusDocs and the Integrated Form of Agreement similar to that used by California's Sutter Health, granted time extensions for the delays.
But they all said it a little differently.
Published in the May 2012 issue of the Journal of Legal Affairs and Dispute Resolution in Engineering and Construction, the study showed that the language of the contract clause itself shaped the emotional response.
According to the researchers, the city of Chicago's clause was considered the most negative in its choice of words, while the integrated agreement language was the most positive.
The Chicago clause, from a city Public Building Commission contract, starts with a sternly-worded and winding first part of this first sentence:
“For a cumulative period of thirty (30) Calendar Days, the Contractor will not be compensated for the following delays: a delay in the commencement, prosecution or completion of the Work by any act of the Commission, including but not limited to a delay, change, addition, deletion or modification in the Work by any act of the Commission…..”
Compare that with the calmly reconciling flavor of the first sentence from the Integrated Form of Agreement:
“Whenever it becomes apparent that the Substantial Completion or Final Completion may extend beyond the Contract Time, as adjusted pursuant to this Agreement, CM/GC shall initiate collaborative effors with the IPD Team to replan the work…”
Menches is interested in the subjective factors that affect a contractor’s behavior and pricing, she says.
One aspect of contracting that interested her was a contractor’s decision to work with a new owner with which the firm had no experience.
“All the contractor has is a bid document and a sample contract, but there’s one other thing that generates emotion and that’s the reputation of the owner," she says. "This is something not easily discoverable. The combination of bid documents plus perceived owner reputation seems to influence how risky they view and may determine whether they add contingency time or money."
The authors admit that the study was limited and carried out in a laboratory setting—not necessarily the way contracts are read in the course of normal business.