If you work in the construction industry, then at one point or another you’ve probably run into problems with getting paid. It shouldn’t be a difficult endeavor. After all, most payment obligations are laid out in negotiated and signed contracts. Yet, non-payment occurs all the time, leaving contractors and subcontractors wondering what they can do to protect their interests. So, what can you do to protect yourself?
Your options for collecting payment
Your first option when it comes to collecting debt is to try to negotiate informal resolution. The other party may not realize that they’ve made an incomplete payment, or the mere mention of litigation may be enough to force them into action. Either way, having a deescalated conversation with the other party can be an effective way to achieve a favorable outcome without the need for prolonged legal action.
If that doesn’t work, though, then you’ll need to consider taking formal legal action. That may come in the form of a breach of contract claim, or you might file for a construction lien. A breach of contract claim may provide you with a cleaner avenue to recover compensation, but even obtaining a judgement here may not lead to payment. That’s where a lien may come into play. Here, you encumber the property until payment is made. This can be a rather effective way of ensuring that debts are collected.
Seek legal counsel when dealing with construction law issues
There can be a lot on the line when a construction dispute arises. And construction law is more complex than many people realize. That’s why it may be in your best interests to discuss your case with an mediation/arbitration who knows how to navigate these issues and can help guide and advise you throughout the process. If that kind of representation is appealing to you, then we encourage you to research mediation/arbitrations in your area and consider reaching out to one of them to discuss your case further.