Disputes and claims have continuously increased along with the evolving landscape of construction industry. As the sector navigates the complex post-pandemic era, a new set of conflicts is anticipated to take shape. Companies that are best prepared for potential changes and delays are likely to be in a favorable position to mitigate the risk of costly litigation.
The past few years have been plagued by construction project delays because of the pandemic-prompted suspension of works worldwide. With a series of challenges that are likely to loom in the construction industry this year, all concerned practitioners must take innovative approaches to be one step ahead of the shifting landscape, especially in construction defect cases and litigation.
Construction claims, which typically arise from disagreements, failed obligations, or violations on construction contracts, can be challenging and time-consuming. Failure to effectively manage and resolve such disputes can have a profound effect on a project’s lifecycle and deter good relationship between parties.
Construction claims are considered as one of the most complex types of dispute. Because of its complexity, involved parties oftentimes choose between litigation and arbitration as a dispute resolution tool.
Disputes on the scope of work, defects, and timeliness often arise in construction and over the years, these disputes have evolved into more complex challenges posing greater problems to project owners and contractors. Although settled through mediation, arbitration, or trial, construction disputes can often be expensive and time-consuming.
Calculating lost profits in a construction dispute is an important factor to prove and recover claims of lost profits damages. However, this process presents a wide array of complexity and challenge for both parties as it requires thorough and accurate analyses of evidence presented. The implementation of an appropriate calculation methodology must also be carefully considered.
Lack of proper project management and documentation, compliance with the present project standards, and excessive costs are often the reasons behind construction disputes. For years, these disputes have created significant challenges and risks in the construction industry.
The construction industry has been hounded by unprecedented threats and other legal pitfalls. Various claims for damage to property or persons arising from construction projects, often expose companies and individuals to the risk of costly litigation. In order to prevent or limit risks arising from such claims, general contractors, subcontractors, and owners must adopt an insurance program that will effectively mitigate the risks of claims and potentially provide a source for coverage and recovery.
