Real Estate Law

Why You Should Consider Mediation for your Construction Dispute (Most of the Time)

As any reader of Construction Law Musings is aware, I am a huge fan of mediation as a way to resolve construction disputes. I am such a fan that a few years ago I took the plunge and got certified as a mediator.

Why then did I put the caveat in the title of this post? Given my true belief that mediation is almost always the best way to resolve a dispute in the “zero sum” game that is construction contracting, why would I qualify my statement that you need to consider mediation? The answer is that, even in the construction world, cost, circumstances and the status of your claim may affect whether mediation is an effective tool in your particular circumstance.

I have said before that I believe that pre-filing “mandatory” mediation required by contract is not the most effective method by which parties can enter into mediation. Such a requirement, particularly when the parties to the construction dispute are most angry and ready to fight, leads to a “check the box” mentality. What I mean by this is that the parties are likely to just go through the motions so they can get to court (or other contractually required ADR) without seriously considering settlement as an option.

Additionally, some claims are frankly too small to pay lawyers and a mediator to settle. That is not to say that even the smallest of claims should not have settlement as a possibility, just that a third party in the room could add an expense.

Finally, the attitude of the litigants (usually mediation in my world of construction occurs in the context of litigation or arbitration), is a major factor in whether mediation will work. If the parties are not ready to at least give a serious effort toward taking advantage of the flexibility of mediation, making a business decision that cannot be made if a judge is deciding the matter, and settling the case, then the best mediator in the world will be much less effective.

To sum this up, maybe the title of this post should be “Always Consider Mediation (but Don’t Always Pursue It).” Mediation with a mediator that knows construction is always an option in any case and should be seriously explored with your experienced construction counsel. However, in considering this great dispute resolution option, know that in very rare circumstances, mediation may not work for your particular construction related case.

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

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