Construction Dispute Law in Minnesota

When the owner of some real estate and a contractor enter an agreement for a construction project in Medina, Minnesota, be it a house, landscaping project, or wide office building, there's always a chance that issues will come up, no matter how careful everyone is. A few minor setbacks are almost inevitable, in fact.

In the overwhelming majority of cases, however, these problems are resolvable, and do not lead to major disputes. Being rational, business-minded adults, landowners and construction contractors are normally able to resolve disputes amongst themselves. After all, both stand to gain if the project is completed, and the contractor is paid.

Even if someone else needs to get immersed 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 normally 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.

Because of the large cost in time and money involved, litigation in Medina, Minnesota is regarded a last resort. However, in rare cases, it does become necessary.

Examples of Construction Disputes That Might Lead to Litigation in Medina, Minnesota

Delays: If the contractor is culpable in a major delay in a construction project (a delay of weeks or months, for example), a lawsuit could result. If the contract particularly states that completion by a particular date is very important, or the builder has a good reason to know this, a court will often award the owner compensation for any economic harm caused by a delay.

Owner's refusal to pay: Contractors can also be the victims in construction disagreements. Sometimes, the person who hired them will refuse to pay the agreed-upon fee, or withhold a portion of it. This, without more, certainly constitutes breach of contract. However, in such cases, the owner will rarely go to court and say "I just didn't feel like paying, so I didn't." Rather, they will claim that they had a very good reason to withhold all or part of the payment, such as unsatisfactory work by the contractor. In these situations, the court has to determine if the owner has a valid reason for not paying. If it concludes that he or she does not, it will order the owner to pay the agreed-upon price.

Subcontractor Disputes: When a construction company is contracted to complete a large project, there is normally 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. Nonetheless, the general contractor (the one that the landowner hired to do the work) is still accountable 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 Liens: Sometimes, when a contractor wins in a case against the landowner who hired him or her, and obtains a court order for payment, the contractor will still refuse to pay. Since a money judgment isn't worth much without a way to enforce it, the laws of many states have evolved to authorize what's known as a "mechanic's lien." As a last resort, if a landowner refuses to pay the contractor for work done on the property, the contractor can force a sale of the property, and keep the proceeds, up to the amount of money owed.

Can a Medina, Minnesota 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 imperative, and a Medina, Minnesota construction disputes attorney can be of great help.