Disputes are all too common in the construction industry. Among the most common causes of a dispute is withheld payments. Nothing can make tempers flare quite like an owner refusing to pay a contractor what they are owed. When an owner refuses to abide by the payment terms of the contract, contractors are often left with little choice but to file a mechanic’s lien, initiate a lawsuit, and plead their case before a judge. But as a Knoxville construction lien lawyer with Cotney Construction Law discusses below, disputes rarely make it to court.
By the Numbers
It’s widely known that the majority of disputes are settled outside a court of law, but just how many actually go to trial? In an article published by the New York Times, Randall L. Kiser, principal analyst at DecisionSet, states, “The vast majority of cases do settle — from 80 to 92 percent by some estimates.” Other sources even claim that this number is closer to 97 percent. However, not all cases are created equally.
In a paper published by Cornell Law Faculty Publications, it’s stated that only tort cases approached a 90 percent settlement rate. The paper goes on to state that two-thirds would be a more accurate single settlement rate. The paper concludes by stating: “Perhaps because relatively little systematic information is available about settlements, discussions of settlement rates tend to be overly simplistic. The 95 percent settlement rate often claimed finds little support in actual practice. The quest for a single settlement rate, or even a single reasonable definition of settlement, may be futile.”
Due to the confidential nature of dispute resolution, we will likely never know exactly how many disputes are settled before reaching court. But the truth remains clear: the majority of cases do settle before going to trial.
Trials Rarely Lead to a Satisfactory Resolution
The reason that so many cases are settled or dismissed is because going to court rarely serves either party’s best interest. In the same New York Times article, it is stated that “plaintiff’s who decided to pass up a settlement offer and went to trial ended up getting less money than if they had taken the offer.” The article goes on to state that defendants are far less likely to be found culpable during trial. If your mechanic’s lien has turned into a lawsuit, don’t do your opponent any favors. Seek a resolution that ends the dispute and puts money in your pocket.
Alternatives to Trial
Trials are reserved for “close calls,” cases where no party is clearly in the right. If you’ve had your contract reviewed by an attorney from Cotney Construction Law, your contract clearly states that you are owed payment for any services and materials provided.
If you are embroiled in a legal dispute, your judge will likely request that an agreement be reached out of court, as stated on uscourts.gov. “The courts encourage the use of mediation, arbitration, and other forms of alternative dispute resolution, designed to produce a resolution of a dispute without the need for trial or other court proceedings.”
If you think that alternative dispute resolution (ADR) processes are a waste of your time, don’t. Trials are expensive, time-consuming, and out of your control. With ADR, you can argue your point in private during an accelerated and cost-effective process. ADR may be your best chance of preserving professional relationships and getting back to the task at hand. As evidenced by the Department of Justice, a whopping 75 percent of voluntary ADR proceedings in 2017 were resolved and 77 percent of unresolved cases still achieved benefits, resulting in 1,967 months of litigation avoided. For assistance deciding if mediation, arbitration, or litigation is right for you, consult a lawyer from Cotney Construction Law.
Buckling Under the Pressure
While our team of attorneys can provide expert litigation services, they rarely have to. More often than not, your legal opponent will buckle under the pressure and give in to your demands, especially when they receive a well-crafted demand letter complete with our Knoxville law office’s legal letterhead.
Owners are also known for buckling under the pressure of a mechanic’s lien. By partnering with a Knoxville mechanic’s lien law attorney and providing an owner with notice of intent to lien filing, you are sending a clear message that litigation is a real possibility. No owner would prefer to go to trial when a favorable settlement can be reached in private.
A Legal Partner Inside and Outside the Courtroom
Legal disputes rarely go to court, but that doesn’t mean they never do. If you are facing a dispute, whether minor or major, you need legal representation that can work to quickly resolve the issue and fight on your behalf in the event that your case is seen by a judge. At Cotney Construction Law, our dedicated team of attorneys can do it all, and they can do it all for a single monthly fee. For an expert in contract review, mechanic’s liens, demand letters, ADR processes, and more, partner with the Knoxville construction attorneys from Cotney Construction Law.
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.