How are disputes between contractors and subcontractors resolved?

In Texas, disputes between contractors and subcontractors are often resolved in one of two ways: litigation or arbitration. Litigation is a process that occurs in court when two parties disagree on an issue and cannot resolve it without outside help. In litigation, each side provides arguments to a judge and jury, who determines the outcome. Arbitration is a process that involves a neutral third-party, typically a lawyer or retired judge, to review the dispute and decide a resolution. This process is usually faster, less expensive, and more confidential than litigation. If the parties in the dispute cannot come to a consensus, Texas law provides an opportunity for them to bring in a mediator, who is an impartial third party that assists in resolving the issue. A mediator does not make rulings or decisions, but instead helps parties understand their issues better and come to a resolution. Texas also has the American Arbitration Association, which provides dispute resolution services, including mediation. Overall, the best way to avoid disputes between contractors and subcontractors is to enter into a clear, written contract with each party, outlining the scope of the project, payment, and expectations. If disputes arise, following the mediation and/or arbitration process will ensure the most efficient resolution.

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