When addressing construction disputes, whether over payments, delays, quality or health and safety concerns, avoiding litigation is the most cost-effective and amicable way of achieving a resolution to a dispute.
However, litigation cannot always be avoided.
When a construction dispute escalates to litigation, it may for a variety of reasons, including but not limited to:
- The parties are unable reach an agreement through mediation or other methods of dispute resolution;
- There is an enforcement issue, such as the outcome of arbitration;
- There are complex or unprecedented legal issues involved.
Whatever the cause of resorting to litigation, it is important that you try to achieve a resolution as quickly as possible with advice and strategy.
Going to litigation
Within construction disputes, where major infrastructure, significant sums of money or health and safety issues are potentially at stake, litigation is a formal and structured process.
Your legal team or solicitor will advise you on each step and what you need to do to prepare.
The exact process will vary depending on many factors including:
- The cause of the dispute
- The complexity of the legal issues
- The parties involved
- Contractual issues
- Parties willingness to cooperate
However, the overall process of litigation usually follows the below procedure:
- Pre-litigation: Before litigation formally begins, the parties may be offered a last opportunity to negotiate informally;
- Initiation: One party will file a claim with the Court against the other;
- Disclosure: During this stage, both parties exchange relevant information, documents, and evidence pertinent to the dispute
- Court: If the dispute is not settled during earlier stages, it may proceed to a trial where both parties present their case before a judge, who will make a final decision upon the evidence provided
- Judgement: The trial may end with a judgment, which could be subject to appeal by the losing party.
Litigation can be a lengthy process, particularly if one party is not cooperative or decides to appeal against the final judgement. However, litigation can also be a successful way to seek to resolve a dispute between parties.
What happens next?
The aftermath of any litigation proceedings will depend on the judgement and any other commercial issues that remain afterwards.
Judgements can vary widely depending on the nature and severity of the dispute. Some of the most typical include:
- An award of compensation or payment of damages
- An order to fulfil contractual obligations
- Legal termination of the contract
- The issuing of an injunction to stop or mandate activities
Litigation is a powerful tool for resolving disputes, meaning it is typically only used as a last resort. In comparison to mediation or negotiation, litigation can be less cost-effective in the long run.
The best way to protect yourself as an individual or your company is to engage fully with alternative dispute resolution (ADR) if possible, and always act in accordance with agreed contracts as far as you able to.
If in doubt, always seek advice from a construction law specialist.
Contact our team today for guidance on avoiding and navigating litigation in construction law.