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Handling construction contract disputes

Few things are more disruptive to your construction business than a contract dispute. Nevertheless, in construction as with any business, contract issues are common and sometimes lead to costly litigation. Whether there is a disagreement about the terms of the contract or an accusation of breach of contract, all work on a project may come to a screeching halt and payment may be indefinitely delayed until you reach a resolution.

These kinds of issues can damage your relationship with the client, your construction company's reputation and your bottom line. Understanding the reasons why many contract disputes arise during construction may help you reduce the risk of these disputes.

Avoiding disputes is the best option

When a client expresses concerns related to the terms of a contract, it does not necessarily mean your business will face a lawsuit. In fact, you may be able to resolve the misunderstanding quickly with a simple explanation. Even if this does not satisfy the customer, you may try other alternatives before resorting to a Kentucky courtroom. The issue with which the customer disagrees may determine whether the solution will come easily. Some common construction contract disputes include these:

  • Project delays and missed deadlines
  • Contract terms or language that is unclear
  • Disputes concerning costs
  • Issues with subcontractors
  • Customer claims that are untrue

The planning stages before the beginning of a project can prevent many situations that result in contract disputes. For example, a careful and detailed examination of the contract with your customer can ensure you both have a clear understanding and common interpretation of its contents. This will also give you a chance to negotiate with your client if the contract contains any clauses that may cause problems as the project progresses.

Dealing with the dispute

You may want to consider adding a clause in your contract template outlining the steps you and your customers will take if disagreements arise. Typically, this would mean exhausting alternative dispute resolutions such as mediation and arbitration before heading to litigation.

Despite your best efforts, you may still find yourself facing a dispute and unsuccessful efforts at negotiation. Because of its cost and the amount of time it takes, litigation may be a last resort. While litigation means you will certainly end up with a thorough resolution to your contract dispute, you will also lose valuable time running your business. Therefore, you want to be sure you have quality legal representation from the very earliest moments of any contract dispute.

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Gatlin Voelker,PLLC

Gatlin Voelker, PLLC
2500 Chamber Center Dr. Ste. 203
Fort Mitchell, KY 41017

Phone: 859-781-9100
Fax: 888-456-9179
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Call : 859-781-9100