Construction Law

Disputes and Lawsuits: When Does it Make Sense to File?

All too often, our Portland contractor lawyers hear stories of contractors that were denied payment but never took legal action because they feared that the cost of legal fees would undo any headway made on a payment dispute. While this is a reasonable assumption, depending on which law firm you choose to work with, your experience could differ drastically.

For instance, when you partner with a Portland contractor lawyer from Cotney Attorneys & Consultants, they can help you get paid, regardless of how much you are owed. In fact, our lawyers will advise you on the best method for procuring payment while maintaining or even improving your bottom line. If litigation isn’t necessary to resolve your dispute, we can use various non-legal methods that have a proven track record of efficacy for helping contractors, subcontractors, and suppliers obtain the money they worked hard to earn. 

When it comes to disputes and lawsuits, most contractors aren’t sure when they should back-off or heap on the pressure, which is why our Portland contractor lawyers have provided some useful tips in this article.

$10,000 or Less: the Demand Letter

When it comes to claims valued at $10,000 or less, it doesn’t hurt to send a strongly worded demand letter before you pull out the “big guns.” This is an especially effective tactic when a Portland contractor lawyer drafts your demand letter on legal letterhead and sends it on your behalf. When the entity that owes you money sees this letter, they will understand that, although this letter is a warning, it’s a sign of more severe legal action on the horizon. Nobody wants to receive a demand letter because it affirms the fact that the party they’ve wronged isn’t going to be walked all over. In most cases, a demand letter is sufficient for procuring payment, and it has the benefit of reduced legal fees, which helps your business save money.

$25,000 or More: the Lawsuit

For claims valued at more than $25,000, filing a lawsuit may be your best option for getting paid. It’s important to understand that unless you partnered with a Portland contractor lawyer in advance and had them integrate an “attorney’s fee” clause into your contract you may still be responsible for paying attorney’s fees even after prevailing in court. On average, legal fees cost about $15,000 in construction-related disputes, so ensuring that the other party is responsible for this expense is essential to protecting your bottom line. However, there are other options to consider before litigation, such as alternative dispute resolution (ADR) methods like mediation and arbitration. These processes can be used in place of traditional litigation and are oftentimes more cost-effective, but you should leave it to your Portland contractor lawyer to determine the best course of action for your business.

Remember, you can protect yourself and create some breathing room when a dispute does arise by investing in a partnership with one of our Portland contractor lawyers before a substantial dispute materializes.

If you would like to speak with one of our Portland contractor lawyers, please contact us today.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.