In a recent client conference, I was asked, “So what is arbitration, anyhow?” In the context of a construction claim or in seeking to prevent such a claim, there are several significant advantages that arbitration can provide in lieu of litigation. In today’s challenging business environment, this signifies awareness of the various options available that could make an important impact on your business’ circumstance.
Perhaps the most common construction-related dispute is the refusal of a party to make payment to its contractors or subcontractors. While litigation is the traditional avenue for resolving such disputes, methods of alternative dispute resolution such as arbitration and mediation are enjoying growing importance in the field of construction law.
We all know what a lien is. Depending on which side of the claim you’re on, a lien could be a good thing or a bad thing. According to Black’s Law Dictionary, the true definition of a lien is “a claim, encumbrance, or charge on property for payment of some debt, obligation or duty”. So, how is a Mechanics Lien any different?
An arbitrator has ruled in your favor. What do you do now? In a perfect world, the other side would just pay you and be done with it, but we all know that this world is less than perfect, and you may find yourself having to enforce your arbitration award. Before you can avail yourself of the enforcement techniques that are provided by New York law, you’re going to have to follow some formalities. The following elements may be necessary for have your arbitration award ‘confirmed’ and seek collections.
Arbitration is an established alternative to court litigation in construction disputes. Challenging an unfavorable construction arbitration award is so difficult that homeowners may wish to give serious thought before submitting their disputes with contractors to arbitration. Courts give great deference to the decisions of arbitrators, refusing to review arbitration awards even for errors of law or fact. There are few exceptions to this rule, and courts only invoke them in rare circumstances.
When it comes to construction contracts, arbitration and mediation (Alternate Dispute Resolution) are both commonly specified for out of court dispute resolution. The use of mediation and arbitration in construction contracts, both for small and large construction, has been increasingly common over the past decade.