Construction Dispute Law in Indiana
When the owner of some real estate and a contractor enter an agreement for a construction project in Ellettsville, Indiana, be it a house, landscaping project, or huge office building, there's always a chance that problems will come up, no matter how careful everyone is. A few minor setbacks are almost inevitable, in fact.
Typically, contractors and landowners can resolve minor disputes amongst themselves, without having to resort to litigation. Frequently, construction contracts contain built-in remedies for mistakes and delays that can be easily corrected, such as payments to the owner for every day the project is delayed.
Even if someone else needs to get engaged to resolve a dispute, this does not automatically mean litigation is necessary. For example, the parties might attempt mediation, in which a neutral third party tries to help guide the parties to an agreement, but cannot render a binding decision himself. They might also agree to arbitration, during which a third party is able to render a binding decision. Arbitration is typically done through a private company, and may cost less than litigation, and is overseen by an arbitrator who is an expert in the relevant field.
Litigation of an Ellettsville, Indiana construction dispute is never something that anyone wants to do. Nonetheless, there are sometimes no other options.
Examples of Construction Disputes That Might Lead to Litigation in Ellettsville, Indiana
Delays in Construction: Delays are frequently points of contention between contractors and landowners. Contracts sometimes have clauses which explicitly state that the project needs to be completed by a certain date, or penalties will be imposed on the contractor (reduced payments, for example). However, if the contract doesn't contain such built-in remedies, or one party refuses to abide by them, litigation may be necessary. If a contractor causes a delay that it could have prevented, it will typically be liable to the landowner for any harm resulting from it.
Owner's refusal to pay: if the contractor finishes a project to specifications, and the owner of the property doesn't pay the contractor, the contractor will most likely file a lawsuit to recover the agreed-upon price. In such cases, the owner will typically argue that the contractor's work wasn't of acceptable quality. In these cases, the court must decide who first breached the contract. In these cases, it's the party who did not breach first who wins the lawsuit. If the court finds that the contractor breached the contract through sub-quality work product, the owner will not be responsible for payment (though he may have to pay for materials and labor), and if the court finds that the construction was acceptable, the owner has to pay, because he is the party in breach.
Subcontractor Disputes: When a construction company is contracted to complete a large project, there is typically a great deal of specialized work to be done which they aren't equipped to handle. As a result, they hire other contractors, who, in this arrangement, are subcontractors, to do some of the work. However, the general contractor (the one that the landowner hired to do the work) is still responsible for the completion of the project - if a subcontractor causes a problem, the general contractor is on the hook for it. This sometimes leads to landowners suing general contractors for the mistakes of subcontractors. If the general contractor loses, and has to pay the client, the general contractor can then sue the subcontractor for whatever amount of money it had to pay.
Mechanic's Lien: If the contractor wins in a lawsuit against the land owner, and the court orders the owner to pay the contractor for services rendered, the contractor needs a way to secure payment, if the owner refuses. In some cases, a mechanic's lien permits the contractor to force the sale of the land, and any improvements to it, in order to secure payment for the services it provided.
Can a Ellettsville, Indiana Attorney Help?
If you are involved in a dispute over a construction project, you should try to avoid litigation, and settle the matter as amicably as possible. However, litigation is sometimes necessary, and an Ellettsville, Indiana construction disputes attorney can be of great help.