Arbitration and mediation in construction related disputes

By Jack L. Werner, Ph.D.

A To Z Inspections

I traveled to Santa Fe, New Mexico, the first part of August to enhance my construction-related credentials through training with Construction Dispute Resolution Services (CDRS).

Owned by Peter Merrill, a member of the National Home Builders Association board of directors for many years, CDRS is the largest arbitration/mediation firm in the U.S. that is solely dedicated to construction-related disputes. Merrill provides training across the nation, but I was fortunate to schedule one-on-one time with him while securing my arbitration/mediation training and certification.

In layman’s language, mediation is an outside party helping two parties arrive at their own agreement.

An arbitrator assesses the facts and renders a decision that can be binding or non-binding.There are many factors favorable for seeking arbitration. A few are:

• The contract calls for arbitration.

• A significant power imbalance exists between parties.

• An immediate decision is needed.

• A confidential decision is desired.

Unfavorable indicators for arbitration are

• Constitutional issues are involved.

• A party wants emotional aspects considered by a jury.

• Proprietary information needs to be disclosed to the decision maker, but the other side cannot see that information.

An arbitrator is trained to enforce the contract, not to “rewrite” the contract to fit the arbitrator’s or any party’s ideas of what it should be. If you are in a construction-related business, you would be prudent to include a clause in your contracts requiring that any disputes be resolved by arbitration and specifically by Construction Dispute Resolution Services. See model contract language and CDRS arbitrators’ qualifications and specialties (listed by state) constructiondisputes-cdrs.com.

Peter Merrill began his career with the CPA firm of Peat, Marwick, Mitchell and Co. (now known as KPMG), specializing in tax accounting and auditing and gaining expertise in financial issues related to the construction industry. Since 1971, Peter has been involved in the construction industry as an award-winning builder, remodeler and designer.

He has served as president of the Santa Fe Area Home Builders Association and the New Mexico Home Builders Association. In 2004 he retired from the construction industry and established Construction Dispute Resolution Services to devote his time and expertise to aid consumers and contractors in resolving construction disputes.

He continually pursues arbitration and mediation study and has attended the Strauss Institute for Dispute Resolution at Pepperdine University School of Law and the Arbitration Training Institute conducted by the American Bar Association.

Mr. Merrill can be reached at 505-473-7733. He would be glad to discuss a dispute resolution process that would work best for your circumstances.

Jack L. Werner, Ph.D., owns A to Z Inspections and can be reached at 405/412-7861 or [email protected]. Performing commercial and residential inspections. Learn more at atozinspectionsok.com. Jack has a construction degree from OSU and was Oklahoma’s first designated Master Inspector. He teaches inspections as well as courses for the Oklahoma State Home Builders and was named a Master Instructor in 2017 by the National Association of Home Builders. He is a trained arbitrator/mediator with Construction Dispute Resolution Services. This essay first appeared in the September print edition of The City Sentinel.