Contractors often end up with monetary claims for nonpayment, changed conditions and/or additional work that are difficult to negotiate. Such claims are often met with counterclaims for defective work, and/or contractual defenses such as lack of notice and/or the lack of a written change order. Defeating such counterclaims are often difficult, but, when it comes to negotiating a settlement of a contractor’s monetary claim, the real difficulty is with the potential attorneys’ and/or costs associated with litigation or arbitration. Even a contractor with a six figure claim amount must seriously consider the attorney’s fees associated with litigating a matter to a final judgment or award in addition to the costs associated with the time its organization spends preparing for and attending any dispute resolution proceeding not to mention the risks associated with putting your fate in the hands of a third party whether that be a judge, jury or arbitration panel.
Anyone who has participated in a mediation has likely heard a mediator say, “Well, if you don’t like that offer, you are going to have to pay your attorneys a majority and/or all of the difference between your claim amount and what is being offered now, and,