• Boston’s Hot Real Estate Market May Give Rise to Construction Litigation
  • August 7, 2013
  • Law Firm: Sally Fitch LLP - Boston Office
  • The greater Boston area is experiencing a hyperactive real estate market this year. According to Redfin, a local brokerage and market research firm, Massachusetts homebuyers are engaging in bidding wars at a rate that is completely at odds with the normally slow dog days of summer. While sales are way up, inventory is way down, creating a bit of a bind for buyers and builders alike.

    Due to the sharp rise in sales, new home construction is shooting through the ceiling and construction contractors are scrambling to keep up with the demand. Numerous residential condominiums put on hold in the past few years are finally sprouting up all over the city. The U.S. Commerce Department says that numbers of applications for building permits for new single-family residences are the highest they have been in five years.

    With the high amount of construction, some issues are bound to arise from general contractor, builder, project owner and buyer perspectives. Following are some tips for helping to keep construction disputes to a minimum:

    • Put it in writing: Put all provisions of an agreement regarding a construction project in writing. Evidence of oral agreements, explanations and promises will not help if a dispute arises. It is especially important to accurately document all revisions to the original construction contract made during the construction process by maintaining a paper trail of change orders.

    • Subcontractor issues: Every aspect of a project delegated to a subcontractor reflects the standards of the general contractor or project owner. Carefully select subcontractors that will be used and subcontractors should, likewise, know for whom he or she will perform work.

    • Unforeseen issues: Unexpected problems may come up and it is wise to address how they will be handled ahead of time, if possible. Issues with soil quality, inferior or defective products or unexpected results should be immediately communicated to all interested parties, if they arise. Construction lawyers can help resolve such issues through negotiation or legal action.

    • Dissatisfied customers: Some buyers expect perfection when they buy a new home. However, new does not mean perfect and every new condominium and home typically has a few issues upon completion. Before starting a new construction project for a client, tell him or her what to expect and explain how punch lists are used after completion.

    Lastly, make sure everyone is using the correct set of blueprints and that all involved in the construction process receive notification of any change orders.

    Consult a lawyer

    Construction companies, builders and buyers can all benefit from the advice of an experienced construction litigation attorney. A lawyer who is knowledgeable about construction contracts, avoiding disputes and litigating construction claims can help.