4 steps to help resolve commercial construction contract disputes

You have an established reputation in the construction industry, and your priority is keeping this. Generally, projects run smoothly and customers leave satisfied and often even return.

Nonetheless, no business experiences smooth sailing 100% of the time, and disputes are bound to arise. What’s important is that you are aware of some useful methods for resolving these disputes. Outlined below are four steps that could prove to be helpful.

1. Talk directly to the client

Many disputes arise simply because of a breakdown in communication. When disputes are tackled promptly with effective communication, they can often be resolved with very few issues. The first step in resolving a dispute is to contact the client directly and find out what they are unhappy with and what they’d like to see happen. At a minimum, your attorney can start to figure out their position and use that information to craft a new agreement, when possible.

2. Try mediation

Sometimes, two parties to a dispute just can’t see eye to eye. It can be beneficial for a neutral third party to step in and offer some guidance. This is where mediation might be helpful. A mediator can assist with getting parties to communicate and finding amicable solutions that are equitable to all. While the process tends to be far less formal than litigation, any agreement reached is legally enforceable. An experienced advocate can help make sure that your interests are protected throughout this process.

3. Consider arbitration

In some cases, parties to a dispute will be unable to find a middle ground. At this point, arbitration could be a viable option. Arbitration is often confused with mediation, but the two are very different. An arbitrator has the authority to look into the facts of the case and come to an enforceable conclusion on their own. Unlike mediation, arbitration is often binding, so it’s particularly important to have an attorney present who can advocate for your rights.

4. Maintain your lien rights

If you have a direct contract, you almost certainly have lien rights against the owner of property for which you have provided services or materials. If you are a subcontractor, there are prerequisites to establishing a lien, including timely service of a Notice to Owner within a specified time after commencing work. Regardless of whether you are a contractor or subcontractor, there are strict requirements as to form and timeliness of filing and serving the documents necessary to perfect a construction lien. Without a valid lien, your leverage in resolving issues with the contracting party will be severely limited.

If other options don’t pan out, litigation is an option. Having a firm behind you that is knowledgeable in commercial construction regulations will be extremely beneficial. You’ll need to carefully review your contract, your position relative to the other party and the strengths and weaknesses of your case. Contact us for more information that can help you decide what steps to take.