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In a Construction Contract Who Decides Where Disputes are Resolved?

In the construction industry, more so than in many other industries, disputes are commonplace. When disputes arise, they can become extremely costly, both in terms of time and money, for everyone involved if they are not resolved quickly. One thing that can prevent an obstacle to the resolution of construction disputes is the fact that it is very common for the parties involved to be from different jurisdictions. Where a dispute is resolved can have a direct impact on how it is resolved, with each party wanting the “home court” advantage. The question then becomes “ In a construction contract who decides where disputes are resolved?”

Whether you are entering into a minor home improvement project or the construction of a commercial complex, everything starts with the negotiation of the construction contract. Just about every term in a construction contract is negotiable, including dispute resolution provisions. Because disputes in the construction industry are so common, it has become commonplace to include rather elaborate dispute resolution provisions in any construction contract. Most construction contracts require the parties to submit to some type of alternative dispute resolution, or ADR, should a dispute arise. Jurisdictional issues are also commonly addressed within the dispute resolution section of a construction contract.

Both the law and the procedures relating to a construction dispute will vary from one state to another, making the choice of venue for a dispute yet another area ripe for disagreement if not decided beforehand within the contract itself. There is no “standard” with regard to who decides where disputes will be resolved; however, if you are a homeowner who does not enter into construction contracts on a regular basis you can almost guarantee that the construction company with whom you are contracting will include a provision requiring disputes to be settled in their home state unless you make a point of negotiating the matter.

Ultimately, jurisdiction over disputes that arise from a construction contract is an issue that can be part of the negotiation process between the parties to the contract. Because it will give the other party a decided advantage, both in terms of familiarity with the law and costs related to the litigation, to have disputes settled in their home state, it is not a point you should concede without first consulting with an experienced construction law attorney. In fact, you should never enter into a construction contract without going over the contract with an experienced attorney fist to ensure that your rights are protected.

If you plan to enter into a construction contract in the near future, contact an experienced Conshohocken, Pennsylvania construction law attorney to review the contract and help you negotiate the terms most favorable to you. Contact the construction law attorneys at Curley & Rothman, LLC by calling 610-834-8819 today to schedule your free consultation.