Smarter Dispute Resolution

Words: Daniel AbitboulJust because your building is set in stone doesn't mean your conflict resolution system should be as well. Most construction contracts and subcontracts contain some mechanism for claims or dispute resolution. Of course, these provisions are written by attorneys, so the conflict resolution system typically involves using attorneys ? theirs and yours ? pitted against each other. Guess who wins? The attorneys.

The way I see it, construction people tend to disagree more frequently than most. That is because there is so much risk ? known and unknown ? in every construction project. Our contracts and subcontracts are instruments for assigning risk between the parties. The risks become a "hot potato" that no one wants, so we keep tossing it to someone else.

When we disagree about who owns the risk, we invoke the contract's conflict resolution system, which usually means that, even if mediation is one of the steps, the end of the road is a lawsuit decided by a judge, jury or arbitrator who knows little about construction. By the time you reach this point, you have also accumulated attorneys' fees, lost downtime that you could have put toward a more productive project, and delayed payment ? making losers of both sides.

Don't be bound by these "set-in-stone" systems. If possible, keep your disagreements in the change order section of the contract. The change order spec is usually very robust, allowing for both direct and indirect costs to be included. Use it.

In construction, when two parties disagree about additional costs or delays, it is usually because we don't trust the other guy's interpretations of the events or contract, or we don't trust the other guy's data of facts, numbers and calculations.

The solution? Pay for what you need. When negotiation fails, before you both hire attorneys, suggest that both sides work together to find out the truth by hiring one independent attorney and/or forensic consultant to review the facts, contract and circumstances and to make an independent, non-binding recommendation on entitlement (the "what") and quantum ("how much"). Give them only a few weeks to do their analysis. Split the cost. Once both sides see the unbiased facts of the dispute, you have an unbiased, unemotional basis for reaching an informed decision ? all within the change order system!

It's a little like going to marriage counseling instead of divorce court. And it works.

The STABILA Force Driven by Operations
July 2025

Leadership In today's competitive business landscape, maintaining an efficient, well-organized warehouse is essential for meeting customer demands and ensuring smooth operations. By implementing effective processes and best practices, businesses can achi

MASONRY STRONG Podcast, Episode 24 Recap: Gary Hensley, VP of Sales at Oldcastle Adams
July 2025

On this episode of the MASONRY STRONG Podcast, Gary Hensley joins Justin in Indianapolis to talk about his story within the masonry industry, how he got started, how he's seen it evolve, and where he sees it going. Why the Masonry Industry? Concrete and

The Enduring Power of Structural Masonry
July 2025

Masonry has been holding its ground for millennia — literally. And thanks to the simple brilliance of arching action, it continues to do so with strength, style, and surprising efficiency. In an era of advanced modeling and fast-moving schedules, one time

Marvelous Masonry: Belém Tower
July 2025

The Belém Tower in Lisbon, Portugal, stands as a testament to stone construction's enduring artistry and technical prowess. Erected between 1514 and 1519, this iconic structure served as a defensive bastion at the mouth of the Tagus River and as a ceremon