ADR – Page 2 – Construction Law Musings- Richmond, VA

Another Reminder to Read Your Construction Contracts

Originally posted 2010-12-06 10:49:11.

Recently, I came across another Virginia construction case that serves as a reminder that, in Virginia, the contract is king and that because of this fact, the contract will be enforced by its terms.

In L. White and Company v Culpeper Memorial Hospital, the plaintiff contractor (L. White and Company) sued the hospital for wrongful termination from the project. The hospital responded that the contract required exhaustion of a two-stage informal resolution process prior to any suit being filed. The informal resolution required both submission of any claim to the architect and mandatory mediation. L. White and Company could show that it had submitted the claim to the architect but conceded that it never sought to mediate its claim. However, L. White and Company argued that the mediation provision was merely advisory.

The Culpeper County, Virginia Circuit Court disagreed with the plaintiff and dismissed the claim in its entirety because the contract provided for exhaustion of the informal resolution process prior to either party filing suit. In short, both sides agreed and signed the contract, and therefore both parties were going to be held strictly to its terms.

While I have discussed the great value of mediation on several occasions here at Musings over the past year and a half (and my thoughts on mandatory mediation), the true takeaway from this case for contractors, subcontractors, and suppliers is to carefully read the contract documents that control your rights regarding a construction project. You, as a construction professional, should read them carefully at the time of signing the contract and any time you plan to make a claim or exercise your rights under the contract. Here, the court clearly implied that the simple act of requesting mediation could have saved the contractor’s claim (particularly if the owner did not reply or blocked mediation).

Remember, your contract is the law governing the construction project. Make sure that you carefully read and analyze that law prior to beginning work. Also, the help of a Virginia construction attorney will help avoid problems down the road.

As always, I welcome your comments below. Please subscribe to keep up with this and other Construction Law Musings.

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When is Mediation Appropriate for Your Construction Case?

Originally posted 2015-04-21 10:03:28.

A simple statistical mediation model. (Photo credit: Wikipedia)

Here at Construction Law Musings, I have often discussed mediation as a good alternative to the expense and headaches of litigation. What I have discussed less often are the circumstances in which it is most appropriate to consider or even push for mediation.

The obvious and clearest time that mediation must be used is where the contract requires it. Many construction contracts, including those from the AIA (when the parties check the appropriate box) require mediation as a prerequisite to arbitration or litigation. As is almost always the case in Virginia, this clause will be enforced. In short, if your construction contract has such a clause, and despite my reservations about “mandatory mediation,” you need to at least go through the process before moving forward with your construction claim.

The more interesting case is where no such clause exists and the parties reach an impasse, sometimes prior to litigation and often after the filing of a construction complaint or demand for arbitration. What questions should you as a construction attorney be asking both to and about your construction clients before attempting mediation? Continue reading When is Mediation Appropriate for Your Construction Case?

A Construction Lawyer Can Help You Negotiate (Not Sue)

Originally posted 2013-05-13 09:00:58.

Negotiation Cartoons: Positions Vs. Interests (Photo credit: jonny goldstein)

Ever since I read the two articles referenced in last week’s Musings, I have been thinking about how I as a Virginia construction attorney can be part of the solution. Then, fortuitously, my good friend and ubermediator, Victoria Pynchon, dusted off her Negotiation Law Blog to discuss 10 Reasons To Negotiate Instead Of Suing The Bastards.

As always, Vickie has insight into the minds of those in conflict (she did write The Grownup’s Guide to Conflict Resolution (somehow I ended up with a blurb) and Success as a Mediator for Dummies). Ms. Pynchon, a wise lady who has assisted and inspired me as a mediator finishes her recent post with:

My best advice? Negotiate the resolution of the dispute yourself even if it requires you to swallow your pride and to be the first one to say, “let’s sit down and figure out how best to serve your interests and mine at the same time.”

Continue reading A Construction Lawyer Can Help You Negotiate (Not Sue)

Mediation in the Zero Sum World of Construction

Originally posted 2015-09-28 09:00:20.

Construction is a zero sum game. What do I mean by that? I mean that even where you, a construction professional with a great construction lawyer, have reviewed and edited a subcontract presented to you or provided a well-drafted contract to the other party that contains an attorney fees provision, every dollar that you spend on litigation is a dollar less of profit.

Couple the fact that no construction company can or should bid or negotiate work with an eye toward litigation (aside from having a well written contract that will be enforced to the letter here in Virginia). Particularly on “low bid” type projects, contractors and subcontractors cannot “pad” their bids to take into account the possibility of attorney fees, arbitration, or litigation. Furthermore, the loss of productivity when your “back office” personnel are tied up dealing with discovery, phone calls, and other incidents of litigation that do nothing but rehash a bad project and increase the expense sap money from the bottom line. While the possibility of a judgment including attorney fees may soften this blow, you are still out the cash. Continue reading Mediation in the Zero Sum World of Construction

Anatomy of a Construction Dispute- A Wrap Up

Originally posted 2015-02-06 09:37:58.

Under construction (Photo credit: Wikipedia)

Over the past four weeks, I’ve “mused” on the “stages” of a construction dispute. What started as a kernel of thought in my mind turned into what has seemed to be a popular set of four posts that I hope were both informative and interesting. Because of the great feedback I’ve gotten, I thought that I’d consolidate the posts into one so that my readers (thank you, by the way) will have them all in one place. Here they are:
Continue reading Anatomy of a Construction Dispute- A Wrap Up