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Most Common Types of Construction Litigation Claims

Serving California and the Western United States

Construction projects are complex. Consider all the parties involved – developers, investors, contractors, architects, engineers, consultants, suppliers and manufacturers. Success depends on the joint and coordinated effort of all those parties. The responsibilities and risks held between the parties can change dynamically from project-to-project.

It’s no wonder that construction claims and litigation are often be complex and require a prudent claims management team consisting of attorneys, consultants and construction experts.

There are many ways for construction projects to go wrong. Here are the most common types of claims.

Bond claims

Private project owners have the right to demand surety bonds to ensure that all the parties involved in the project will deliver what was promised under the contract. There are different surety bonds in construction, and by the same token, different claims can be made. Different bonds protect different parties. When and if a party breaches the contract, a claim can be pursued against that party.

Construction defect claims

A construction defect is a failure of a building component or system due to poor design, workmanship or materials. Construction defects can be any part of the building, from foundation cracks to corroded piping to a leaking roof. Often they create financial harm to the owner, usually through damages caused by the defect, loss of use, diminution of value or repair costs to correct the defect.

These construction defect claims have to prove that 1) the construction defect is an occurrence, 2) property damage took place because of the faulty work delivered by contractor’s poor management and 3) the defect was not listed in business risk exclusions.

One preventative measure to construction defect claims is the construction team having an effective quality management program, usually including third party quality assurance consultants.

Mechanic’s lien claims

These claims are typically filed by various subcontractors and suppliers. They are also called materialman’s liens, supplier’s lien or laborer’s lien. The law allows subcontractors and suppliers to place a lien on property which was improved by the materials, equipment or labor they supplied, if they weren’t paid by the general contractor. This lien gives them an opportunity to recover the payment they are owed. Unfortunately, the property owner isn’t protected against this process even if they paid the general contractor in full.

Breach of contract claims

Breach of contract is defined as failure, without legal excuse, to perform any promise that constitutes all or part of a valid contract. If this breach causes damages to the non-breaching party, that party has the legal right to remedy. It is important that the filing party is themselves compliant with the contract. Depending on the construction delivery method and the claim, allegations can involve numerous contracts signed between owners, architects, general contractors and subcontractors.

Construction delay claims

These claims are also called disputes related to schedule impacts. Delay claims generally relate to unforeseen events and circumstances that call for deadline extension and/or prevent the work process from being executed as planned.

What is most often contentious about a schedule delay claim is whether the delay affected the critical path of the project, how long exactly the delay is, what the root of the delay is and whether the delay entitles the contractor to ask for time extension/ more compensation. There are various possible causes of delay: poor management and administration, restrictions in site access, financial issues, defective plans, permits and approvals, changes in the work, differing site conditions, inspections, weather conditions and acts of God. 

Personal injury claims

There are two common scenarios where personal injury claims intersect with construction litigation. The first of which are injuries that occur on the construction site, either involving workers or bystanders. Much of the work on the job site is dangerous by nature. For a personal injury claim, what needs to be established is that an unsafe act and/or unsafe condition occurred. In most cases the claims have to prove that OSHA safety standards were not followed by one or more parties. Please get advice from professional injury claim solicitors if you need more advice or help
to discuss your case.

The second scenario are injuries that involve existing building elements after construction is completed. This can be something straightforward as slips, trips and falls on walkways or more complex cases where construction defects led to an injury of building occupants, such as a balcony collapse.

Failure-to-disclose claims

In real estate law in California, sellers and real estate professionals are required to disclose any information they know that may impact the value or desirability of a property to a potential buyer. A failure to disclose is a breach of their duties to a fair dealing. This can be anything from not disclosing unpermitted renovations to black mold in the attic. If the buyer can demonstrate harm from the failure to disclose and that they couldn’t reasonably discover this information themselves prior to completing the real estate transaction, they may file a claim.

 


Ensure Project success with Xpera Group

Xpera Group brings together a diverse team of construction experts from all construction-related fields. Their combined experiences amount to lifetimes of field work and constant career advancement through education and practice. Reach out to us if you want to be sure your construction project is successful. With our forensic, quality assurance and development services offering, we are positive that we can help you prevent issues in your construction project or resolve them in the best possible manner if your project is already having trouble. Contact us today and we will connect you with the ideal expert!

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