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California clears up confusion about contract dispute mediation

California may be more scenic without a huge construction industry, but the homes and infrastructure for millions of people depend on the workers and equipment that build and maintain them. Construction projects are often complicated and involve different specialties, so owners and developers rely on contracts to get people to work together.

Disputes can happen in construction contracts all the time, so many include clauses for how the signatories will try to resolve them. Although several disputes turn into lawsuits and see the inside of a courtroom, a large majority are sorted out before that would ever be necessary.

Mediation is one of the most popular advanced forms of contract dispute resolution. A new law signed by the governor in Sacramento requires lawyers to inform clients of the specific requirements of confidentiality for mediation. This comes after some confusion by parties to mediation on what parts of the process could be used in a later suit or court action.

Attorneys who engage in mediation starting in 2019 must provide written descriptions on confidentiality restrictions, and they must obtain written confirmation from their clients after the fact. This move should reduce the number of people in a dispute who make a mistake because they are unaware of key differences between court proceedings and mediation.

Contractors and developers with a contract dispute to resolve may use mediation, a lawsuit or other means to end it. In any of these options, an attorney is advisable to represent the interests of claimants and work with other parties to solve problems as quickly and easily as possible.