Debunking the Biggest Myths About Construction Dispute Resolution

Jan 17, 2018 | Construction Lawyer, Litigation Support

Construction dispute resolution is often perfect for the construction industry.

construction dispute resolution

The construction industry is one of the few industries that is practically tailor-made for construction dispute resolution. This is because of how many legal disputes commonly arise in a construction project. Let’s discuss the alternative form of resolving legal and contractual disagreements among businesses in the construction industry as well as some of the common myths that exist.

What Is Dispute Resolution?

Dispute resolution (sometimes referred to as alternative dispute resolution) refers to a variety of methods and procedures in place where parties can address their legal disagreements without going to court. This can include:

  • Mediation
  • Arbitration
  • Neutral Evaluation
  • Negotiation
  • Dispute resolution

Each form has its advantages and disadvantages, but they all share the same goal of resolving the dispute as quickly and efficiently as possible to preserve the business relationship among construction companies and save time and money.

Here are some common myths associated with dispute resolutions in the construction industry:

Myth #1: A Civil Trial Is Not Possible

In some situations, parties entering into a form of dispute resolution to resolve their construction disagreement will be bound to the result, even if they don’t agree with it. But in many instances, once the alternative dispute resolution process is complete, the parties still have an option to going to a civil trial and litigating like they normally would in court.

Myth #2: Dispute Resolution Will Hurt Us Later in Court

In many forms of dispute resolution, the information exchanged, arguments presented and things said are not permanent. In other words, if the parties later choose to go to trial, they can decide to use different evidence or make new legal arguments. Also, each side cannot use any incriminating information exchanged during dispute resolution later at trial. So the parties often don’t have to worry about saying the wrong thing during dispute resolution procedures.

Myth #3: Even If I Win, I’ll Still Have to Go to Trial

As discussed above, this is theoretically true, since many dispute resolution decisions can change later if the losing side decides to challenge it in court. But this doesn’t happen as often as you might think. There are several reasons for this.

First, going to trial is expensive; after all, that’s one of the biggest reasons to try dispute resolution in the first place. So when deciding to go to trial, a losing company must take into consideration how much more they will have to spend. This “upfront cost” with no guarantee of victory is a strong deterrent to going to trial.

Second, if a company loses at arbitration, that company now has a good indicator of what may happen at a future trial. That’s because many forms of dispute resolution, such as arbitration, uses impartial arbitrators or evaluators to decide the case. Therefore, dispute resolution can serve as a good predictor of what may happen if a judge or jury gets to decide the case. In other words, a company that loses during dispute resolution can see the writing on the wall before trial.

So even if it’s possible to have a trial after dispute resolution, it’s often too expensive to do so or not worth the risk.

Still have questions? Schedule your complimentary consultation with the Wilbanks Law Firm, P.C. about construction dispute resolution by calling (706) 335-2355 now.