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Settling construction disputes: arbitration as courtroom alternative

A bullet-point list of problematic issues that can arise during the course of construction transactions is decidedly lengthy. Construction principals are many and diverse (ranging from buyers and sellers to lenders, contractors, architects and more). Projects typically face time constraints. Contracts are complex and lengthy. And money is understandably a key concern.

Even when a construction project is completed, various disputes can arise. Indeed, many alleged breaches of contract and other cited problems occur during the post-transaction stage.

We duly note that on a page of our website addressing Colorado real estate disputes at the Denver-based O’Brien Legal Services LLC. And we stress that arbitration can sometimes be an optimal process for resolving post-transaction legal challenges.

That is not always the case, of course. Parties in some instances strongly insist on the formality of court rules and processes, coupled with the close oversight of a judge, to resolve material construction disputes.

However, legions of industry participants also know that taking a construction dispute to arbitration can sometimes confer distinct benefits that are not so readily available – or flatly lack – via a formal resolution process conducted through court.

One in-depth online overview highlights several of them, noting for starters the clear finality often linked with an arbitrator’s ruling. Arbitration awards can sometime be challenged in court, but judges typically grant them due respect and will weigh in only in cases of clear fraud or other serious departure from justice.

And then there is speed. Although not uniformly the case, arbitration does generally progress with more dispatch than a court proceeding. There is also far more flexibility regarding scheduling and document production, which can imbue participants with a sense of control and autonomy that lack in a court.

Those factors can collectively contribute to lowered dispute-resolution costs, which are obviously always a core concern for business principals. So too is privacy, which is often greatly enhanced in arbitration when compared with the public nature of formal litigation. The above-cited article notes that lawsuits “are eminently public affairs.”

Arbitration is not a panacea for resolving every construction dispute, but it can be a preferable venue to a court filing on many occasions.

An experienced real estate legal team with a demonstrated history of client advocacy in the construction realm can provide further information.

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