A Practical Guide to the Phases of Construction Litigation

Construction disputes can escalate quickly, if not properly managed. Budgets shrink, schedules slip, and contract interpretations differ. At Estavillo Law Group, our experienced attorneys bring over 50 years of combined experience in real estate and foreclosure matters, as well as complex construction conflicts, offering large-firm skill with personalized attention.

In this guide to the construction industry, we provide a clear, step-by-step overview of each phase in the construction litigation process and dispute process, from the first warning signs to what happens after a verdict. Whether you are an owner, contractor, or subcontractor, this roadmap will help you recognize issues early and make informed decisions with confidence.

Most common construction disputes trace back to a few common causes. We encounter issues such as payment delays, late or missing payments, construction delays, workmanship mistakes, and changes to the scope that were not appropriately priced or documented.

When tension rises, slow down and create the paper trail. Read the contract, all change orders, daily reports, pay apps, emails, texts, and meeting minutes. A tight review tells you what was promised, what changed, and what proof you actually have.

Spotting a dispute early can change the entire direction of a case and help avoid additional costs. With quick notice and thorough documentation, you can fix narrow issues before they grow into claims that hit the schedule or your bottom line. Careful record-keeping matters, as does the dispute resolution process, along with written dispute resolution terms. Under California Code of Civil Procedure Section 1281, written agreements to arbitrate are valid and enforceable, which makes it worthwhile to include clear ADR provisions in every construction contract.

If the basic facts and contract duties are pinned down, the next smart move is to try to talk it out before anyone files suit. A calm discussion supported by documents often helps to resolve disputes and misunderstandings before they escalate into legal action.

Before anyone files a complaint, most owners, contractors, and subs try direct talks. A brief phone call, followed by a written summary or letter with supporting documents, can help clarify confusion about project changes, change orders, delays, or payment disputes related to timing. A well-written demand letter sets expectations, documents your position, and often prompts the other side to engage before things reach court.

Early resolution, including pursuing alternative dispute resolution, saves money, preserves working relationships, and helps the project stay on track. In California, courts strongly support settlement efforts before trial. Many counties, including Alameda, Contra Costa, and Santa Clara, encourage early mediation or settlement conferences through local court programs. Judges can also require the parties to meet with a neutral mediator under California Rule of Court 3.1380.

If your contract includes a “meet and confer” or “executive review” clause regarding project scope, follow each step carefully. Failing to provide a required notice or skipping a meeting can give the involved parties grounds to challenge your claim later. Treat each communication as if it could be reviewed in court — it should be clear, factual, and professional.

When talks stall, stay disciplined. Continue collecting project records, update your timeline, and calculate your exposure to understand the financial impact if the case continues. Sometimes, the strength of your documentation alone persuades the other side to settle once they see how complete your file is.

If informal negotiations fail, review the dispute resolution clause in your contract before considering legal proceedings. Many construction agreements require mediation before resorting to litigation or arbitration to maintain legal standing , which is why having a construction litigation attorney can be crucial. Complying with that step preserves your right to recover costs and may even satisfy court requirements before you can proceed.

Handled correctly, legal counsel during pre-litigation efforts often sets the tone for the rest of the case. Clear communication and organized records can transform what starts as a heated disagreement into a practical, negotiated outcome that allows everyone to move forward.

The discovery process is a complex stage that involves gathering facts. Each side requests documents, asks written questions, and takes testimony to build the record that a judge or jury will see later. The goal is to lock in facts, not surprise anyone at trial.

In California, discovery procedures are governed by the Code of Civil Procedure Sections 2016.010 through 2036.050. These rules govern depositions, interrogatories, requests for admission, document production, and the use of expert witnesses. The discovery phase often takes the most time and plays a major role in shaping trial themes, motions, and settlement value.

Because construction projects generate thousands of communications and technical files, this phase requires strong organization. Emails, BIM data, project logs, schedules, inspection reports, and meeting minutes can all become evidence. Sorting these materials early helps your legal team focus on what truly matters and avoid missing deadlines.

Many disputes, including those related to construction defects, turn on details buried in correspondence or digital project records. It is wise to create a discovery plan that identifies who holds key information, where files are stored, and what terms to use for electronic searches. Cooperation between your attorney, project team, and IT staff ensures that data is preserved and searchable when needed.

Discovery also serves as a reality check. It reveals the strength of your case, exposes weaknesses in the other side’s story, and often sets the stage for productive settlement talks. Once the facts are on the table, many cases move toward mediation or arbitration, and some never reach trial at all.

ADR, short for alternative dispute resolution methods, can occur before a lawsuit, during the course of a case, or even just before trial. It gives both sides more control over timing, privacy, and cost compared to going through a full courtroom process.

Mediation works well when you need a practical, business-first solution for construction projects or when technical issues are complex but can be solved through discussion and documentation. It is confidential and gives both sides room to find creative compromises that a judge might not order.

Arbitration is more structured than mediation but faster and more private than the trial process. An arbitrator reviews the evidence, listens to witnesses, and issues a written award that usually becomes final and binding. In California, arbitration is governed by the California Arbitration Act (Code of Civil Procedure Sections 1280–1294.2), which enforces written arbitration agreements, limits appeals once a decision is issued, and often involves discussions on insurance coverage.

Many California construction contracts include specific contract terms, such as a “step clause” that requires mediation first, followed by arbitration if mediation fails. Following that process is essential because skipping a required step can prevent a party from recovering legal fees or enforcing contract rights later.

ADR also works best with open communication when both sides, involving multiple parties, have already exchanged key project documents and understand the facts. Once the groundwork is done, these sessions often lead to practical resolutions that save time, protect relationships, and get projects back on track without waiting for a court date.

Trials are about presenting a clear, credible story that the fact-finder can follow. Attorneys present documents, schedules, cost data, and testimony from project witnesses and individuals with technical knowledge. Clear, plain explanations of complex construction issues help the judge or jury connect the events to the contractual obligations, contract language, and the claimed losses.

Evidence comes in through direct testimony, cross-examination, and exhibits. Your attorney will highlight how the paper trail supports your position, tying daily logs, pay applications, and correspondence to the events that led to the dispute. Outcomes can include monetary damages, orders to perform or refrain from certain work, or rulings that clarify and enforce the contract’s terms.

In California, civil trials are governed by the California Code of Civil Procedure and the California Rules of Court, which outline how evidence is introduced and how witnesses are examined. Construction cases often involve both factual and technical proof, so expert testimony from engineers, cost estimators, or schedulers is common to explain causation, delay, or workmanship standards.

Trials carry real risks. They take time away from ongoing projects, incur costs, and introduce uncertainty until the verdict is in. Because of that, many parties continue settlement talks even during the trial. The pressure of being in court, compounded by labor shortages, often motivates practical agreements before the judge or jury delivers a final decision.

When the trial ends, the process is not always over. Either side can file post-trial motions or appeal a ruling they believe was legally flawed. Collecting a judgment may also require follow-up steps like recording liens, garnishing accounts, or enforcing the court’s order through the sheriff’s office.

Handled carefully, a trial can reset the record and bring closure to a long-running dispute. Even when it does not resolve everything, it defines the rights and obligations of each party and sets a firm foundation for compliance moving forward.

After a verdict, either side may file post-trial motions to correct errors, clarify rulings, or ask the court to reconsider certain findings. If a party believes the law was misapplied, they can appeal to a higher court. Appeals in California focus on legal questions, rather than new evidence, and they are governed by strict deadlines under the California Rules of Court.

Winning in court is one thing; collecting payment from property owners is another. Enforcement may include recording the judgment, placing liens on property, or pursuing payment schedules and garnishment, depending on the available assets. For California construction cases, compliance with the California Civil Code Sections 8000–9566 helps protect payment rights. Structured payment plans or close-out releases are often included in settlements to reduce future conflict and expedite resolution.

Each dispute among project participants offers lessons for the next project and can impact business relationships, helping to prevent future disputes . Tighter scopes, clearer change procedures, and steady communication help prevent a repeat. California courts give substantial weight to written terms, timelines, and documentation. Therefore, taking the time to draft clear contracts with construction professionals can help mitigate risks and maintain accurate daily records, which always pays off in the long run.

After litigation, it’s also worth reviewing your internal procedures. Check how your team tracks emails, stores project files, and handles field directives. Even small updates, like using consistent file naming or standard change-order templates, can prevent confusion later.

If you want a quick review of your contract stack or an action plan for an ongoing dispute, a short call can help you confirm priorities and move forward without wasted steps.

We fight hard to protect owners, builders, and subs when projects go sideways, and we do it with cost control in mind. If you need steady guidance through a dispute or are facing a lawsuit and require a plan quickly, please don’t hesitate to reach out. Feel free to call (510) 982-3001 or visit our Contact Us page to connect with a knowledgeable attorney.

We welcome your questions from construction companies, whether you need help drafting a demand, preparing for mediation, or getting ready for trial. A brief conversation can clarify your options and help us provide strategic advice, along with the next steps you can take today. If you are ready to talk, we are prepared to listen and help you move forward.