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Contract clauses that reduce the risk of litigation

Contracts are the lifeblood of contractors in North Carolina, but as with any agreement between two or more parties, there is always the chance that something will go wrong. To protect yourself in case of a breach claim, you may want to consider alternative dispute resolution methods that may keep you out of the courtroom should a problem crop up. At Triangle Law Group, our team is well-versed in construction contracts and ways that contractors can minimize the risk of litigation.

Often, dispute resolution is approached in stages. The American Arbitration Association explains that mediation may be the first step, and possibly the only step, needed to resolve a contract issue. By including a clause that requires mediation, you can ensure that you and the other party have the opportunity to sit down and discuss what went wrong. The mediator is neutral and unbiased and has training in construction contract law and dispute resolution. Therefore, this person (or people, if you choose to have more than one) can guide both parties toward an effective and legal solution. However, the mediator does not impose a solution. You and the other party have to do that.

If mediation does not resolve the contract issue, you may need to move on to arbitration. Unlike the mediator, the arbitrator does have the authority to make binding decisions. In fact, the arbitrator acts much like a judge, and the process is similar to taking the issue to court. The primary differences are that arbitration typically costs less, takes less time, and does not expose the parties involved to a public court case. More information about effective resolution techniques to include in construction contracts is available on our webpage.

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