Construction Disputes Are Rising Globally - and Kenya's Building Sector Is Not Immune

Construction disputes have long been a fixture of the building industry, but recent years have seen them grow in frequency, complexity, and cost. Across global markets, contractors, developers, and governments are clashing over contracts at rates that are putting projects and professional relationships under serious strain.

A 2023 report by Arcadis, a global construction consultancy, placed the average value of a construction dispute at $52.6 million, with resolution taking an average of 15.6 months. Those are not outliers. They reflect a sector where disagreements over money, time, and responsibility have become a standard part of doing business.

At the core of most disputes is a familiar set of triggers. Payment failures top the list, with contractors not receiving what they are owed, or not receiving it on time. Variations and scope changes are another major source of friction. When a client alters project requirements mid-build without clear agreement on cost adjustments, conflict almost inevitably follows. Poor contract documentation, unrealistic schedules, and unclear risk allocation round out the usual causes.

In Kenya, the construction sector has expanded rapidly over the past decade, driven by public infrastructure programmes, private real estate development, and growing foreign investment. That growth has brought opportunity but also the disputes that tend to come with high-volume, fast-moving construction activity.

Delayed payments remain a persistent complaint among Kenyan contractors, particularly those working on government-funded projects. The National Construction Authority has flagged payment delays as a systemic problem, one that cascades down supply chains and leaves subcontractors and suppliers bearing the financial weight of stalled projects. In some cases, disputes have escalated into litigation or arbitration, both of which are costly and slow.

Design errors and changes are another common flashpoint locally. In a market where design and construction sometimes proceed simultaneously under pressure to break ground quickly, incomplete drawings and late-stage revisions create fertile ground for conflict. The contractor builds to one set of plans, the client expects another, and the gap between those two realities becomes a dispute.

The post-pandemic period introduced new pressures that accelerated these trends globally. Supply chain disruptions drove material costs up sharply. Labour shortages stretched timelines. Force majeure clauses, once considered routine contract boilerplate, became actively contested as parties argued over who should bear the cost of circumstances no one had anticipated. Kenya was not insulated from any of this. Imported materials saw significant price increases and project budgets came under stress across the board.

International construction firms operating in East Africa have noted that dispute resolution infrastructure in the region, while improving, still lags behind more established markets. Arbitration is increasingly preferred over litigation for its relative speed and confidentiality. The Nairobi Centre for International Arbitration has worked to position Kenya as a regional hub for commercial dispute resolution, construction cases included.

Experts point to early contractor involvement, clearer contract drafting, and structured dispute avoidance mechanisms as the most practical ways to keep conflicts from escalating. Dispute boards, where a standing panel monitors a project and intervenes early when tensions arise, are gaining traction on large infrastructure projects internationally. Their adoption in Kenya, however, remains limited.

What tends to get lost in conversations about construction conflict is that most disputes are predictable. They are often the outcome of contracts drafted in haste, risks allocated unfairly, and communication that breaks down once delivery pressure sets in. The dispute itself is rarely the beginning of the problem.