No developer, builder, contractor, manufacturer or supplier wants to deal with a construction claim during the course of construction or a construction defect lawsuit after completion. However, construction claims and construction defect litigation can arise in just about any project. And with the number of commercial and residential projects continuing to increase since the sharp decline during the pandemic, construction-related disputes, claims, and defect litigation are also on the rise.
Parties that wind up involved in these cases should be aware of the potential costs and risks.
Breaking Down the Costs
In construction matters, the costs break down like this:
First, construction of commercial and residential projects can be an exceedingly complicated process. During the course of construction, contractual disputes or claims may arise between developers, architects, engineers, contractors, suppliers, and manufacturers. Such disputes may result in increased project costs and breach of contract claims. Allegations of breach during construction can result in delays, project cost overruns, unanticipated change orders and extras, replacement products and materials, liquidated damages, and additional labor.
Second, costs in construction defect lawsuits could be any damages that a party may need to pay. These construction defect damages can reflect:
- Cost of repairs or diminution in value
- Any personal injuries allegedly resulting from a defect
- Loss-of-use expenses
- Business interruption
- Attorneys’ fees pursuant to a contractual duty to defend
- Expert investigative fees
- Pre-judgment interest
- Punitive damages in the event there are accusations of misrepresentation, concealment, nondisclosure, or fraud
Calculating damages can be difficult, as parties often do not agree when it comes to the cost of an alleged defect. This is why it is critical to consult with an experienced attorney specializing in construction law.
Invest in the Right Legal Representation
Considering how extensive the financial fallout from these construction claims and litigation can be, it is crucial to invest in the right legal representation. With smart legal counsel, parties involved in these claims can seek out the most cost-effective solutions while also minimizing any unreasonable or unfair financial penalties.
Construction claims and construction defect lawsuits are complicated, and potentially expensive. Thus, anticipating these costs and working with an experienced construction law attorney is vital, not just to resolving such matters, but also in identifying and removing risks to prevent or minimize future construction related lawsuits.