Why Construction Companies Need Special Lawyers
Lawyers for construction companies have a lot of hats to wear, and construction companies and contractors alike need lawyers for construction companies who are experienced in commercial litigation, the appeals process, construction law, and employment law, in addition to having a mastery of all kinds of environmental regulations and community codes. Here are just a few reasons lawyers for construction companies are so necessary.
- Employment contract issues can get messy. Just between April of 2006 and January of 2011, economic downturns resulted in more than 40% of the construction industry’s workforce being eliminated. Now the industry is rebounding, and in 2016 the construction market in America was worth about $1,162 billion. As employees are hired and laid off, contract disputes and labor issues are an inevitable part of doing business that lawyers for construction companies need to know how to deal with.
- Builder’s risk coverage has to be done right. ISO’s Builder’s Risk Coverage Form, the CP 00 20, is the simplest and quickest avenue to obtaining builder’s risk coverage, but even fully understanding that form can be tricky without professional help and someone who knows all the ins and outs of this minimum one-year coverage for new buildings or alterations and repairs to an existing building.
- Things are changing fast in the construction and contracting industries. This isn’t always a bad thing, but it is a thing that lawyers for construction companies have to keep on top of if they’re going to help clients protect their companies and their assets as methods and materials change. Robotics and 3-D printers are just one example of enormous changes that have come about in recent years. Drones are increasingly used in construction, particularly in the surveying stage, and Colin Guinn of 3-D Robotics believes drones are on their way to make quite a few engineering and architectural tasks easier to perform and more accurate when it comes to results. With drones come a host of new laws and regulations, and the involvement of a whole new regulating body–the FAA–which means that lawyers for construction companies need to master the ins and outs of this new aspect of construction and design.
- Everything can be on the line when it comes to arbitration. The American Arbitration Association oversaw 551 construction cases in 2015 that were for claims of $500,000 or more. All the construction claims in that year totaled $5.5 billion, and the largest mediated case was for $2.6 billion and the largest arbitrated case for $96 million. The largest case ever resolved by just one arbitrator was for a $232 million claim, and the smallest (actually arbitrated by three people in this case) was for a $23,000 claim.
While arbitration or other alternative dispute resolution is the preferred method of settling disputes in the construction industry–and this is indeed preferable to taking a lawsuit to court–the process still takes an average of eight months. There’s a lot that can go wrong during this kind of time period, and in arbitration in general, and having a good construction law firm is essential to getting a good outcome.
- The worse really can happen. Sometimes contracts, arbitration, and advance preparation simply aren’t enough and cases end up in court. Most states allow only a certain amount of time before a breach of contract claims can be filed unless otherwise specified by contacts, but when it comes to court cases there’s nothing good to be had by messing around. A review of the civil cases brought in 2005 showed that plaintiffs won bench trials nearly 70% of the time and jury trials 54% of the time. Attorneys for construction companies need to be brought in at the beginning of a project so they know all the ins and outs of the contract in case the worst does happen.
Lawyers for construction companies have a lot of areas of law, regulation, and code that they must master. They have to also be skilled negotiators, arbitrators, and trial lawyers. It’s a specialized job, but one every construction company is glad exists when the moment of truth arrives.