Construction Dispute Law in Minnesota
When the owner of some real estate and a contractor enter an agreement for a construction project in Thief River Falls, 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 usually 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 involved 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 usually 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.
Construction Dispute litigation in Thief River Falls, Minnesota is usually time-consuming and expensive. But it is sometimes necessary, usually as a last resort.
Examples of Construction Disputes That Might Lead to Litigation in Thief River Falls, Minnesota
Delays in Construction: Delays are often 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 usually be liable to the landowner for any harm resulting from it.
Owner's Refusal to Pay: If the contractor completes the project, and the owner refuses to pay the agreed-upon price, the contractor will usually file a lawsuit to recover what is owed. Of course, the owner will usually claim that there is a good reason for not paying, arguing that the contractor didn't conform to the project's specifications, or that the quality of construction was unacceptably poor. In such a case, the court will have to decide if the contractor actually breached the contract by doing shoddy work, which could, at least in part, excuse the owner's duty to pay.
Subcontractors: With big construction projects, contractors usually hire other, smaller contractors to do some of the work for them. This is usually work of a specialized nature, which the general contractor isn't equipped to handle (such as plumbing or electrical wiring). The general contractor is the one who is responsible for the satisfactory completion of the project. If a subcontractor makes a mistake, or causes a delay, the general contractor is ultimately liable to the person who hired them. Nonetheless, if they are sued for the mistakes of a subcontractor, and lose, they can then sue the subcontractor to recover their losses.
Mechanic's Lien: When a contractor wins a case against a client for nonpayment of the contract price, and the client still declines to pay, there is a problem: a monetary judgment means next to nothing if it can't be enforced. To solve this problem, the mechanic's lien has been developed. Essentially, if a landowner refuses to pay a contractor, even in the face of a court order, the court can force a sale of the property that the contractor worked on, along with all the improvements on it, and then give the funds to the contractor, to secure payment.
Can a Thief River Falls, Minnesota Attorney Help?
Disputes over construction delays or defects can be extremely taxing. Therefore, getting an experienced Thief River Falls, Minnesota real estate attorney might mean the difference between success or failure in your business ventures.