Common Types and Resolution Options.

Construction projects can be complex, involving multiple parties, tight deadlines, and significant financial investments. Despite careful planning, disputes often arise between contractors, subcontractors, developers, architects, and clients.  They can  disrupt progress, inflate costs, and damage business relationships if not managed effectively.

In this article, Senior Solicitor Thomas Browne  of  Kingsfords Solicitors Litigation and Disputes Team explores what constitutes a building construction dispute, the most frequent types of disagreements, and the three primary methods of resolving them: Mediation, Adjudication, and Litigation.

If you are one of the parties mentioned above and are involved in a construction dispute,  please contact your local Kingsfords office in Ashford Cranbrook or Hythe,  to discuss how we can help.

What Is a Building Construction Dispute?

A building construction dispute occurs when there is a disagreement or conflict between parties involved in a construction project. These disputes often relate to contractual obligations, project timelines, workmanship, or payment issues. If left unresolved, they can escalate into potentially costly and time-consuming legal battles.

These disputes may emerge during the planning, execution, or post-construction phase of a project. They may be caused by misunderstandings, breaches of contract, or unforeseen circumstances that affect performance or expectations.

Common Types of Construction Disputes in the UK

Several types of disputes commonly arise in the UK construction industry. Below are the most frequent:

1. Payment Disputes

Delayed or non-payment is one of the most common causes of construction disputes. This could involve withheld retention payments, quite commonly disputes over final account figures, or failure to pay for variations.

2. Delays and Extensions of Time

Projects rarely go exactly to plan. Delays may be caused by weather conditions, changes in scope, supply chain issues, or workforce shortages. Disputes often arise over who is responsible for the delay and whether a time extension is justified.

3. Defective Workmanship

Claims regarding poor-quality work or failure to meet the required specifications are common. These can lead to costly remedial work, reputational damage, or legal claims for breach of contract.

4. Contractual Disputes

These involve disagreements over the understanding of contract terms. Disputes may focus on scope of works, variations, liquidated damages (for late or poor performance), or insurance obligations.

5. Professional Negligence

Claims may additionally be brought against architects, engineers, or surveyors for providing incorrect advice or services that lead to project failure or additional costs.

Resolving Construction Disputes in the UK

Disputes do not always need to go to court.  In such disputes going to Court should arguably be the forum of last resort, rather than first. There are a number of dispute resolution methods available in the UK construction industry, with the most common being Mediation, Adjudication, before embarking on Litigation. Each method has its own advantages and is suitable for different circumstances.

Mediation

Mediation is a voluntary, confidential process in which an independent third party – the “mediator” – helps the disputing parties negotiate a settlement.

Benefits of Mediation:

•    Cost-effective: Mediation is usually cheaper than formal legal proceedings.
•    Faster resolution: Disputes can potentially be resolved within a few weeks.
•    Preserves relationships: Rather than being an adversarial process, mediation supports ongoing business relations, by trying to remain collaborative.
•    Flexible outcomes: Parties can agree on more creative solutions, that courts may not be able to order.

When to Use Mediation:

Mediation is ideal for parties who wish to resolve a dispute as amicably as possible, especially where maintaining a business relationship is important. It is often used before or alongside other resolution methods.

Adjudication

Adjudication is a dispute resolution process introduced under the Housing Grants, Construction and Regeneration Act 1996. It gives parties the right to resolve disputes quickly during the course of a project.

Key Features:
•    Quick decisions: An adjudicator’s decision can typically be made within 28 days of referral.
•    Binding outcomes: The decision is temporarily binding, pending final resolution by arbitration or litigation.
•    Common in construction contracts: Most standard UK construction contracts include adjudication clauses.

Benefits of Adjudication:
•    Keeps projects moving: Because it delivers quick decisions, adjudication can sometimes prevent work from stalling.
•    Enforceable outcomes: Decisions can be enforced in the Technology and Construction Court.  (As if they were a Court Judgment).

Suitable For:

Adjudication is well-suited for payment disputes, delay claims, and disagreements over variations. It is particularly effective when an immediate resolution is required to keep a project on track.

Litigation

Litigation involves taking the dispute to court. In construction cases, this typically means using the Technology and Construction Court (TCC), a specialised branch of the High Court in England and Wales.

When to Use Litigation:

Litigation may be appropriate for complex, high-value disputes where other resolution methods have failed or not considered suitable. It is often used when legal precedents or third-party claims (such as professional negligence) are involved.

Pros:

• Legal clarity: Courts provide binding judgments and set legal precedents.
• Disclosure: Parties are required to disclose relevant documents, which should provide greater transparency and help strengthen a case.
• Appeals process: If a party disagrees with a decision, there is a route to appeal.

Cons

• Time-consuming and costly: Litigation can a significant period of time to conclude and may incur significant legal fees. (A ‘winning’ party can normally expect to be awarded around 75% - 80% of its own costs from the ‘losing’ party – or on a full indemnity basis in rarer instances).
• Public record: Court proceedings are generally not confidential.

Which Method Should You Choose?

The appropriate method depends on the nature and complexity of the dispute, the urgency of the resolution, and the relationship between the parties. 

Conclusion

Building construction disputes in the UK are unfortunately common but can be managed efficiently with the right approach. Understanding the types of disputes and the available resolution methods, allows parties to take informed, strategic action.

Wherever possible, it's best to resolve conflicts early and amicably. Seeking professional advice from a construction solicitor or dispute resolution expert can help you choose the best path forward and protect your commercial interests.

Contact Us

If you  are a party involved in a construction dispute and wish to discuss any of the issues raised Senior Solicitor Thomas Browne   and the  Kingsfords Solicitors Litigation and Disputes Team is on hand to support you. Please contact your local Kingsfords office in Ashford, Cranbrook or Hythe. Alternatively, you can send an enquiry and a member of our team will get back to you promptly, by calling us on 01233 665544 or emailing via tnb@kingsfords.net.   We are happy to discuss your concerns without obligation.