L EG AL ISSUE S SPO T L IGHT


The Growth of Arbitration and Mediation in Construction


BY MARILYN KLINGER, SMTD LAW A


fter 45 years of practicing con- struction law, representing virtually everyone on a con-


struction project, including design pro- fessionals, owners, general contractors, specialty trade subcontractors, and bonding companies/sureties, I am now focusing my practice as a neutral party doing arbitration and mediation work. During my time as a construction law


“trial” attorney, the alternative dispute resolution field has grown exponentially, such that I had to start calling myself a “trial attorney,” both in court and in arbitration. While there do not appear to be any


statistical analyses comparing arbitration to court trials, my perception is that the majority of construction disputes have gone the mediation and then arbitration route rather than litigation and trial. Te key reasons for that phenomenon are (1) mediation/arbitration clauses included


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CALIFORNIA CONSTRUCTOR MAY/JUNE 2026


in form contracts (2) time to resolution, (3) privacy and confidentiality, (4) no juries, (5) finality/no right to appeal, and (6) limited discovery. Following are a few observations about the use of arbitration and mediation in construction disputes.


Arbitration Te American Institute of Architects in- cludes in its form construction contracts an option to arbitrate. Te ConsensusDocs suite of contracts also includes the option of resolving disputes via arbitration. Most construction folks continue to select the arbitration option, whether under the American Arbitration Association (AAA) or JAMS rules. As arbitrations are private and arbitra-


tion awards are confidential, some critics bemoan the fact that the resolution of so many construction disputes no longer creates precedent that parties can rely


on to manage the performance of their contracts. However, generally those crit- icisms are outweighed by the benefits of arbitration.


Among those benefits:


• Tey are private. • Te adjudicators will be knowledgeable construction professionals.


• Discovery is limited. • Te rules of evidence do not apply. • Tere is no jury. • Te evidentiary hearing is scheduled sooner than trial.


• Te parties can generally control the schedule and are not at the mercy of a judge.


• Te arbitration award is final, most of the time, avoiding the appellate process and the delay and costs associated with appeals. Occasionally, a few of the above bene-


fits fall by the wayside, the most prevalent of which is the limitation on discovery.


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