Nothing slows down a project like a dispute. Supply or site problems can make a job drag on and on but, when there’s a dispute, it comes to a grinding halt that throws the whole system out of sync. Budgets skyrocket and legal fees add up.
Disputes cost an estimated $25 million in 2015 in North America, as reported by consulting firm Arcadis. That same report notes an average of 13.5 months per dispute. It’s an extensive and messy legal battle that is rarely solved quickly.
Which is why mediation is so important.
Value of mediation
Mediation is one of the most common methods of alternative dispute resolution, with parties coming together to hash out differences and meet in the middle. It’s faster and cheaper, keeping the project on schedule and offering something for everyone. Delays in any projects are what cost the most, and if it goes too far beyond the budget there’s the risk that nobody will get paid in the end.
Communication errors and work quality are often sticking points for the developer, along with problematic relationships between contractors and subcontracts and site conditions. Often times, these disputes come from a disagreement about the original contract: namely, information that is missing, unclear or misinterpreted.
Mediation seeks to restore balance and communication without spending a year in the courtroom while the job sits unfinished. Construction contracts are notoriously complex and, when they reach litigation, move slowly. The longer the delay, the greater the cost. In mediation, both sides make gains and reach a solution through the help of a third party.
While no business enters a contract expecting conflict, the nature and scope of the construction industry creates complicated agreements that end up with questions once put into practice. Experienced litigators of construction law can help create an ironclad contract and also work on handing mediation and disputes to make sure that a project’s goals at met.