Disputes and Litigation in Construction Law

Common Causes of Disputes and Litigation in Construction Law

If you’re involved in the construction process in any way, you may encounter these common disputes and litigation in construction law.

Construction projects are a substantial investment, and numerous working parts are involved. Stakeholders want to protect their assets at all costs, and workers want to be compensated fairly and promptly. There are many instances where disputes and litigation may arise in construction law. Conflicts can be inevitable, but there are ways to solve and avoid them once they’re brought to light. It’s crucial to be aware of the most common causes for litigation in construction law, whether you’re currently engaging in a dispute or want to mitigate ones that may arise.

Negligence, Misconduct and Deficiencies

One of the top reasons for litigation in construction law is the result of a contractor’s deficiencies, misconduct or negligence. When contractors promise specific timelines, results, and other deliverables, they’re expected to honour those promises. When they fail to do so, it can severely impact the completion and overall success of a project. To avoid litigation in these cases, a contractor will typically have to negotiate a settlement with the other party out of court.

With respect to deficiencies, however, it is important to allow the contractor a reasonable opportunity to repair the deficiencies before the owner can retain another contractor to complete the repair work. Failure to do so may impact the owner’s ability to recover their repair costs.

Payment 

In Ontario, the Construction Act (the Act) outlines prompt payment and adjudication laws. The Act aims to prevent payment disputes, a widespread cause for litigation in construction law. Owners must pay within 28 days of receiving a proper invoice or dispute said invoice within 14 days. Contractors have seven days to pay or send notice of non-payment to subcontractors after receiving payment from the owner. In both instances, if a dispute is made, it must include the reasons for non-payment. Unfortunately, even with these laws in place, payment issues still arise. Knowing your rights and the law and hiring a good construction litigation lawyer can help you win, negotiate, and avoid payment disputes.

Site Conditions 

Before a construction project can start, the worksite is examined to ensure that workers can complete the project. Suppose you arrive to work on a site and the conditions are different from what the examination stated. In that case, you may need to change plans – causing delays and increasing costs. Depending on the circumstances, differing site conditions could also create a safety risk for workers. When a construction company is given inaccurate information, it may choose to proceed with legal action.

Contract issues 

Understanding your rights and responsibilities in construction law is vital to prevent and identify contract noncompliance. The legal consequences and ramifications of contract issues can be extremely costly, time-consuming, and frustrating for everyone involved. If you’re a contractor or project manager, you can be held responsible for all contractual activity, so it’s essential to ensure you’re complying with construction laws and contracts.

Consult with a lawyer for disputes and litigation in construction law 

Whenever someone finds themselves in a construction-related dispute or facing litigation, it’s wise to consult with a construction litigation lawyer. Your lawyer will have experience with different types of cases and will know the best way for you to proceed. Construction laws may be complicated for some, but your lawyer can answer all of your questions and concerns in a way that you can easily understand. Litigation doesn’t have to become a severe problem; it’s not incredibly uncommon, and there are plenty of ways to prevent issues from escalating. Take the necessary steps to avoid and prepare for legal troubles and work with an experienced lawyer. You’ll increase your likelihood of achieving a favourable result.

This content is not intended to provide legal advice or opinion as neither can be given without reference to specific events and situations.

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