Florida is experiencing a building boom, with new construction a major driver of the local economy. However, the news isn’t all good. The increase in the building industry brings with it a new kind of challenge: construction disputes.
When a disagreement arises over project specifications, payment issues, or other disputes, deciding between mediation and Florida construction litigation becomes a top priority.
In this article, we break down the key differences between the two resolution options, plus answer other questions such as:
- What is mediation in Florida construction disputes?
- What is Florida construction litigation?
- How do you choose the right approach between litigation and mediation?
- What role does a construction litigation attorney play in the process?
What is mediation in Florida construction disputes?
Mediation in Florida construction disputes is an alternative resolution process that involves a neutral third party, called a mediator, who assists the parties in reaching a mutually agreeable solution.
The first step in mediation is choosing a qualified and experienced mediator with a deep understanding of construction issues and the legal framework in Florida for resolving them. Impartiality is key. Mediators must not have any stake in the outcome to remain truly impartial.
Mediation is voluntary and confidential. Information shared during mediation cannot later be used against either party in litigation.
Pros of mediation
One of the biggest benefits of mediation to resolve Florida construction disputes is cost-effectiveness. It can significantly reduce legal fees, court costs, and other expenses associated with lengthy court proceedings.
Other pros of mediation include:
- Timely resolution. Mediation often leads to a quicker solution, making it more attractive than waiting months (or in some cases, years) for litigation to run its course.
- Control over the outcome. The parties involved in mediation control the proceedings and possible solutions. Litigation relies on a judge or jury to determine a resolution that may not be in either party’s best interests.
- Preservation of relationships. Court battles can turn ugly, ruining relationships between contractors and other construction professionals who may want to work together in the future. Mediation promotes a more collaborative and cooperative atmosphere.
- High success rates. Mediation has a high success rate in resolving disputes.1 Many construction disputes are settled through the process, with the parties reaching mutually agreeable solutions.
Cons of mediation
While mediation offers several advantages2 for resolving construction disputes in Florida, it’s essential to consider its limitations as well.
Mediation may not be the best approach for every construction dispute. One of the primary disadvantages of mediation is the outcome is non-binding. The parties involved are not required to accept the recommendation, which means the dispute proceeds to litigation.
Some of the other cons of choosing mediation include:
- Risk of incomplete discovery. Mediation may not provide the same level of information and discovery as Florida construction litigation. If any of the parties involved needs to gather extensive evidence or uncover hidden details related to the dispute, a lawsuit may be the more suitable option.
- Reliance on willingness to cooperate. All parties must agree to participate in good faith. Mediation is ineffective if even one participant involved in the construction dispute refuses to cooperate.
- Potential for unfavorable agreements. In mediation, parties can agree to terms that, upon later reflection, they find unfavorable. They may have felt pressured to accept a resolution that wasn’t in their best interest.
What is Florida construction litigation?
Florida construction litigation refers to legal action taken to resolve disputes within the construction industry. It typically follows the legal procedures and rules in the Florida Statutes and is subject to the state’s specific construction and contract laws.
These disagreements can involve property owners, contractors, architects, engineers, suppliers, and others involved in the construction process.
Some of the most common issues include:
- Bond claims
- Breach of contract
- Construction defects
- Delays and extensions
- Design and engineering problems
- Lien claims
- Payment disputes
- Professional liability
Pros of litigation
Litigation is usually a last resort in Florida for most construction disputes. However, with pressure rising in the state and across the nation to build faster, disagreements have become more common.3
When formal legal action in the courts becomes necessary, it offers some advantages to resolving the situation:
- Contract enforcement. Unlike with mediation, the courts enforce contractual obligations between the parties. This is especially important for contractors and subcontractors seeking payment for their services.
- Expert witnesses. In the courtroom, all parties involved in the dispute can call expert witnesses in architecture, construction, and engineering to support their argument.
- Mechanic’s liens. Florida has specific laws related to mechanic’s liens,4 allowing subcontractors and suppliers to file liens to secure payment for services and materials.
Cons of litigation
While construction litigation has its advantages, it can also be a lengthy, costly, and adversarial process. One of the biggest drawbacks is the risk of damaging relationships within the Florida construction industry. No guarantees of success exist when leaving the outcome in the hands of the court.
Other cons include:
- Costly and time-consuming. Florida construction litigation can be a lengthy process. Experienced construction attorneys, expert witnesses, and other court costs add up quickly, making it the more expensive of the two options.
- Impacts on project progress. Legal disputes often lead to construction project delays, increased costs, and disruptions, which are detrimental to all parties involved.
- Appeals process. If one party is dissatisfied with the outcome of a construction litigation case, they have the right to appeal. Doing so creates additional expenses and time before a resolution is reached.
- Public record. Construction litigation disputes resolved in a courtroom are generally part of the public record. Details of the disagreement – including sensitive financial information – become publicly accessible.
How do you choose the right approach between litigation and mediation?
Choosing between construction mediation and litigation in Florida is a critical decision. Before deciding which option to pursue, it’s important to consult with a skilled and experienced construction attorney who can review the specific circumstances and objectives.
Begin by thoroughly understanding the nature of the disagreement, all parties involved, the issues at stake, and the desired outcome. Clarify what you hope to achieve through mediation or legal action to decide which is more conducive.
Other considerations include:
- Assess the contract. Review the construction contract at the heart of the dispute. Contracts often include dispute resolution clauses that may specify mediation as a prerequisite to litigation. Ensure an understanding of the terms and obligations of all parties.
- Evaluate the relationship. Consider the impact of the dispute on your working relationships with the other parties involved. If preserving favorable associations is preferred, then mediation may be a more suitable alternative.
- Explore hybrid approaches. In some cases, a combination of mediation and litigation might be the most effective approach. Parties can attempt mediation first and proceed to litigation if they do not achieve the desired outcome.
What role does a construction litigation attorney play in the process?
In Florida, construction litigation is a complex and specialized field of law due to the state’s specific construction regulations and case law.
It’s critical to work with a construction litigation attorney who has the experience and expertise to navigate the entire process, including providing legal guidance and representing clients in court.
Their primary duty is to assess the case and offer legal advice on the best course of action. A construction attorney meets with their client to review the contract, discuss the issues and desired outcomes, and then make a recommendation on how to proceed.
An attorney can engage in settlement negotiations with the other parties or represent their clients in the mediation process. If a dispute heads to court, they prepare a legal strategy that can include legal research and analysis and identifying expert witnesses for testimony.
Informed decision-making in Florida Construction Litigation
Making informed decisions about Florida construction litigation requires a thoughtful and strategic approach. Consulting with legal professionals experienced in Florida construction statutes is the most important step you can take.
A Florida construction litigation attorney can manage the complexities and potential challenges of the legal process, helping clients achieve their desired outcomes.
Sources
- Effectiveness of Mediation: An Independent Analysis of Cases Handled by Four Major Service Providers. ojp.gov. Accessed October 17, 2023.
- Mediation in Florida. flcourts.gov. Accessed October 17, 2023.
- Construction Lawsuits Are Spiking As Pressure Rises To Accelerate Projects. bisnow.com. Accessed October 17, 2023.
- The 2023 Florida Statutes. leg.stat.fl.us. Accessed October 17, 2023.