Throwing Money at Construction Disputes May Not Solve the Problem

by | Jan 20, 2021 | Construction Law

In the construction industry, contracts are crucially important to protecting the interests of everyone involved in a project. Even smaller scale projects often require multiple contracts between the various parties to clearly dictate parameters and limit liability for those involved.

In the event that someone breaches a contract, it can be tempting to assume that the offending party will be required to pay the non-breaching party for a mistake. However, money is not always the solution to these situations.

How Much Will This Cost?

Issues such as delays or scope changes can have a major economic impact on the project, as can mistakes caused by subcontractors or problems related to defective materials. Additionally, negligent parties who fail to take proper care can damage property or cause catastrophic injuries. Construction projects are complex and involve long timelines, many workers, and large sums of money. The first step in any dispute is to examine the facts to determine who is liable.

When Parties Should Seek Alternate Outcomes

Depending on the nature of the construction dispute and the relationship between parties, economic relief may not even be an option. For example, in California, the economic loss rule dictates that parties cannot recover purely economic damages in a negligence claim if they did not suffer personal injury or property damage.

Further, contracts may expressly specify other remedies beyond economic relief. If valid, such contracts are typically upheld in a court of law.

And in many cases, courts may order a party to perform the promised work or deliver the guaranteed product or service under what is called “specific performance.” In the context of a construction dispute where a party completed work with the wrong materials, s/he may be required to go back to the job site and correctly complete the work.

Canceling a contract altogether may be another viable strategy.

Know Your Legal Options

If you are involved in a construction dispute regarding contract breaches or negligence, Edlin Gallagher Huie + Blum can work with you to identify the best options and design a viable strategy to achieve swift resolution.