Although construction disputes can arise from a number of factors, some of the more common reasons for disagreement are:
- Conflicting expectations
- Poor risk allocation
- Lack of communication
- Unclear contracts
- Failing to deal with problems as they come up
Business owners and contractors can avoid most of the above issues with proper planning and communication.
Understand the Contract
One of the best ways to avoid construction disputes is to understand the contract. You should review the contract terms and conditions with a construction litigation attorney before signing. Of particular importance are the payment terms, adjudication clause, variations and extension of time clauses, and time limits for issuing dispute notices. A clear contract is important in resolving disputes.
Before starting a construction project, potential risks should be identified up front. After risks have been identified, the parties should agree who will be responsible for obtaining insurance for those risks. For risks that cannot be insured, the parties should determine who is best able to minimize that risk.
Maintain good records and communication throughout the project. Give notices as required in the contract and provide regular updates to clients, especially if there are going to be project delays. Before performing any extra work or incurring additional costs, get the client’s approval in writing. If everyone remains on the same page about delays and extra costs throughout the project, disputes will be less likely.
Resolve Problems Early On
If a setback arises, deal with it immediately. As soon as it becomes apparent there is a potential problem, notify other parties about the issue and work together to find an agreeable solution. Ignoring or failing to mention a potential problem increases the likelihood it will escalate into a dispute that requires legal action to resolve.
If you are involved in a construction dispute, need assistance with a construction contract or want advice about how to handle a potential problem, contact a knowledgeable Monmouth County business lawyer today.