You’re a general contractor on a large commercial construction project impacted by significant delays. You place most of the blame for the delays on the project architect, who you contend issued a wrongful stop work order arising from the performance of one of your subcontractors and performed other construction administration services negligently. Both you and the sub have incurred significant extended general conditions as a result of the work suspension, and you invite the sub to make a delay claim you intend to pass through as a component of your own claim to the owner, who, under the contract documents, is legally responsible for the acts of its architect.
The sub wants to participate in a pre-litigation mediation you’ve scheduled with the owner, but you’re hesitant to oblige. The owner, after all, will spend mediation blaming your sub for the issues giving rise to the stop work order, and you worry your sub’s presence could actually hamper, rather than facilitate, the settlement negotiations.
Are you better off refusing the sub’s request to participate in the mediation, trying to settle with the owner first, and then circling back to resolve open issues with your sub once things are squared away up-the-chain?
That would be a risky play, as a 2011 North Carolina Court of Appeals decision demonstrates.
N.C. Construction Law, Policy & News 