Recent developments have cast doubt on arbitration in the construction industry. The common belief by many builders is that arbitration is faster and cheaper than litigation, though that is not always the case. Homeowner and consumer groups on the other hand, including Consumers Union, the publisher of Consumer Reports, say that arbitration panels may be stacked in favor of industry and deprive home owners of their constitutional right to a jury trial.

It is common sense that the best approach to winning a dispute is to avoid it in the first place. Easier said than done. Most, if not all building and construction contracts today include an “arbitration clause” for use if the inevitable dispute arises. This clause generally sets forth that if a dispute arises, both sides agree to submit the matter for arbitration before the American Arbitration Association (“AAA”), according to the AAA’s established rules and costs. The arbitration or “hearing” is in reality a “mini trial” where each side presents its evidence and witnesses before an arbitrator that is jointly selected by the opposing sides from a panel of approved arbitrators.

The premise behind mediation and arbitration is a speedy cost-effective resolution. Unfortunately, the acceptance or demand for an arbitration clause may be an unwary, time consuming and expensive trap for the unfamiliar.

The attorneys at Kushnick & Associates, P.C. routinely handle arbitration matters and are intimately familiar with the rules and procedures of the AAA, including the Construction Industry Arbitration Rules and Mediation Procedures and the Home Construction Arbitration Rules and Mediation Procedures. In addition to prosecuting or defending the arbitrations, Kushnick & Associates, P.C. also regularly advises clients on whether arbitration provisions should be included in their contracts, on the scope and applicability of the arbitration provisions in their existing contracts and, after an arbitration award has been issued, the process for appealing, affirming and enforcing the award.

If you are entering into a contract and want to know whether an arbitration provision is right for you, or if you have already entered into a contract and have a dispute that you believe should, or must, be settled by arbitration, don’t get caught unprepared, contact us for a free initial consultation to discuss how we can help you protect your rights and develop a strategy that is right for you.

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