How do you resolve a construction dispute?
Construction disputes can be resolved through negotiation, alternative dispute resolution (ADR) or, if necessary, litigation.
Adjudication, a form of ADR, is an effective means of achieving the aim of maintaining cash flow during construction projects. It is also appropriate for resolving financial disputes relating to, for example, delay and disruption claims, extension of time claims and final account disputes.
Under the Construction Act 1996, the statutory right to adjudicate is implied into the contract. The referring party should first give the notice of adjudication to every other party to the contract, and then appoint an adjudicator.
The adjudicator must reach a decision within 28 days of the referral, although the parties may agree to a longer period after referral of the dispute. An adjudicator’s decision is enforceable until the dispute is finally determined by legal proceedings, arbitration or agreement.
If the losing party does not comply with the adjudicator’s Decision, a party may apply to the Technology and Construction Court to enforce it.
We can act for either the developer or the contractor in a construction dispute. We aim to deliver a swift and economical resolution so you can get your project back on track with minimal fuss.
Can I sue a contractor?
If your contractor does not complete the work to a professional standard, you may be able to make a claim against them based on:
- Breach of a contractual term (expressed in the contract or implied by statute); and/or
- Breach of duty of care based on the tort of negligence
In contract, the contractor’s professional standard may be expressed in the contract or implied by statute. For example, it will usually be implied that the service will be carried out with reasonable care and skill.
In negligence, the standard of care expected of a contractor will be that of the reasonable competent contractor. That standard may be raised higher, for example, if a contractor holds itself out as being a specialist in a particular area.
A successful claim would generally entitle you to monetary damages to compensate you for the loss caused by the contractor’s negligence or breach of contract. For example, as a result of the contractor’s actions, your property value may have decreased or you may have needed to enlist another professional to rectify the situation.
We can act for developers bringing claims of negligent work, or represent contractors defending such claims, as well as providing expert legal advice on the merits of a claim.
How does the Construction Act 1996 affect payment disputes?
For the most part, parties are free to agree to specific payment terms and conditions, including the amount due and when payment becomes due.
However, certain payment provisions set out in the Construction Act 1996 specify the payment terms that a construction contract must contain. If a construction contract does not comply with those payment provisions, the Scheme for Construction Contracts 1998 will imply terms into the contract. It is important to ensure the payment provisions in a construction contract comply with the payment provisions, to avoid consequences which were not intended by either party.
As with other forms of construction disputes, payment disputes can be resolved through adjudication or other forms of ADR, which often provide a quicker and more cost-effective method than litigation.
We can act for a developer or contractor in a payment dispute, as well as providing tailored legal advice on the provisions of your contract.
