What is a homeowner to do when a project under construction comes to a grinding halt? A delay can come in many forms — stop-work orders, zoning problems, inclement weather, contractual disputes — but the end result will always hit you right in the wallet.
There may not be much that can be done about natural disasters or inclement weather, but fortunately, most of the other project delays can be avoided or at least resolved.
Dispute resolution procedures for contracts typically involve three options — litigation, mediation or arbitration. Of the three, typically mediation will be the first step to consider. In fact, some contracts stipulate that before the parties can proceed to the other two options, mediation must be attempted.
Mediation is nonbinding, yet still frequently resolves conflicts. It’s also generally less expensive than either arbitration or mediation.
Qualified mediators quantify issues and streamline the dispute-resolution process for the parties. However, not all disputes can, or should, be resolved through mediation. For instance, when parties in a zoning dispute are at swords-point with wildly disparate land-use views for a piece of property, it’s not likely that mediation will help them reach accord.
In some cases, arbitration may. If you elect to arbitrate your case, you should realize that, unlike mediation, arbitration rulings are binding. That means that if you are dissatisfied with the results, in most cases, you won’t be able to litigate the matter in court.
Arbitrators are not judges. They may be one individual or a panel of industry insiders who can understand the issues at hand and rule fairly on matters. Most belong to professional societies like JAMS (Judicial Arbitration and Mediation Services) or the American Arbitration Association (AAA).
It’s a common perception that “arbitration favors contractors,” said one attorney partner in a New York City firm. Arbitrators also can sometimes skirt the law in their rulings, which can make litigation a more appealing way to resolve a dispute that hangs on the letter of the law.
Still unsure which way is the best to resolve your dispute? Learning more about Arizona zoning and contract laws could point you in the right direction.