COVID-19 AND THE CONSTRUCTION INDUSTRY

Here's How You Can Protect Your Business
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Prevalence of Unsubstantiated Claims

Sometimes, one party will start a lawsuit against another party and not have any evidence to support their claim, so a judge will dismiss the case. This type of claim is called an unsubstantiated claim, as there is no evidence that supports it. Unfortunately, going to court costs money regardless of the outcome, which can be a problem for construction companies that need to absorb the cost. In this article, a construction defect attorney in Brentwood, TN, discusses the prevalence of unsubstantiated claims.

Related: Handling Claims During a Construction Project

Unsubstantiated vs. False Claims

There is a difference between unsubstantiated and false claims. A false claim is simply untrue. If the false claim makes its way through the legal process, the outcome should reflect that. By comparison, an unsubstantiated claim may be true or false, but it lacks the evidence required to substantiate or prove it.

Increase in False Claims

There has been an increase in the number of false claims filed against construction companies in the past few decades. While the likelihood that your company will necessarily face an unsubstantiated claim in a legal case remains relatively low, it is a possible problem that you could face in the future. Certain segments within the construction industry, such as residential homebuilders, could be at a higher risk simply because of the nature of the work and the end-users.

Related: Common Types of Construction Claims

State-Level Protections Against False Claims

To combat the negative impact of false claims, there are certain states that have implemented state-level protections against false claims. There is no federal law that currently protects construction companies against unsubstantiated claims. There are certain requirements for this law to be in effect, however, so it’s a good idea to discuss your specific case with a lawyer for more individualized advice. 

Risks

All companies are at risk for unsubstantiated legal claims. Fortunately, there are ways that you can reduce your risk level, including having thorough documentation of project completion, maintaining high-quality assurance processes, and using only reputable vendors for contractors and materials.

It can be scary to face unsubstantiated claims, especially when the claims could put your business at risk. The best way to manage this is to hire a lawyer to discuss your options and to build a strong defense that protects your company’s professional integrity. If you have questions about how to fight an unsubstantiated claim, contact a contractor attorney in Brentwood, TN, from Cotney Construction Law.

If you would like to speak with a contractor attorney in Brentwood, TN, please contact us today.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.