Originally from Dispute Resolution Journal

This article is an outgrowth of the author’s graduate thesis in dispute resolution. With the support of the Association of General Contractors of Colorado, the author interviewed 20 commercial building contractors (including general contractors and subcontractors) along Colorado’s Front Range to ascertain their perspectives on conflict resolution in the construction industry. Contractors are intimidated by the prospect of litigation, fearing that they will become mired in a legal battle that could threaten their business with financial ruin. While contractors largely accept arbitration and its promise of lower costs and shorter duration, they are concerned about its increasing emulation of litigation. Nevertheless, contractors seem reluctant to embrace mediation wholeheartedly. This article assesses contractors’ attitudes toward the most-used ADR methods, summarizing the perceived strengths and limitations of each.

Until the 1970s, the construction industry tended to settle disputes the old-fashioned way—in court. Reliance on litigation began to erode in the 1970s when court dockets became backlogged with a growing number of cases, and the cost of litigation increased dramatically. In the 1980s, the U.S. Supreme Court issued a series of pro-arbitration rulings that encouraged commercial parties to provide for arbitration of disputes in their contractual arrangements. The construction industry has been in the vanguard of using many different types of alternative dispute avoidance and resolution options over the years—arbitration, mediation, partnering, and dispute review boards among them. In their search for reliable alternatives, contractors have largely accepted arbitration yet remain reserved toward mediation and other forms of alternative dispute resolution (ADR).

This article discusses the attitudes and experiences of Colorado contractors toward litigation, arbitration, mediation and negotiation. For this article, I conducted face-to-face interviews with 20 commercial building contractors and subcontractors along the Front Range of Colorado, whose annual volume ranged from $5 million to over $2 billion.