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Alternative dispute resolution can resolve construction disputes

On Behalf of | Mar 29, 2021 | Construction Law

Even smaller construction projects in Broward County have a lot of people involved in them.

The owner of the land as well as the contractor and subcontractors, and other parties, all have their own role to play. Not surprisingly, legal disputes frequently develop if expectations are disappointed.

While it is important for a contractor or other business in the construction industry to advocate for its interests in these disputes, going to court can get costly and time-consuming.

It also could delay or even derail a construction project, which in turn costs everyone involved additional time and money.

For this reason, a construction company may first want to try alternative dispute resolution, or ADR. Many times, a contract may require ADR, while courts may also routinely order litigants to try ADR before going further with a case. Finally, many litigants will voluntarily use ADR in the hope doing so will both save costs and efficiently resolve a dispute.

In a construction dispute, there are different types of ADR from which to choose

 Construction businesses have a number of types of ADR from which to choose:

In arbitration, all sides will present their cases to a neutral person or panel outside of a courtroom setting.

The proceeding will not be subject to as formal of rules and procedures as would a trial, but the decisionmaker will still hear evidence and arguments and make a decision which may be binding. The members of the panel often are retired judges and may be experts in construction law.

Mediation also involves a neutral third party, but he or she will serve to help those having a dispute to negotiate a resolution rather than simply make a decision. The parties are free to walk away from the mediation, but if they do reach an agreement, it will likely be binding.

As a relatively new ADR technique, neutral evaluation involves the sides submitting evidence and arguments to a qualified person who will then give an informed opinion about how much a case is worth.

It is effective when someone involved, perhaps an insurance adjuster for example, does not have reasonable expectations about a case.

Which type is best depends on a business’s overall circumstances and the facts of the case. The business may also have to convince the other side to use one form of ADR as opposed to another.