Contractors: How to Avoid Disputes

by Corey Philip
April 27, 2018

Running a construction or repair business can be a pain in the ass, even on a good day. Even during the times your employees are up to speed, even when your clients commit to pre-agreed schedules, even when your equipment is working like it should—things happen.

And when things go wrong, you can count on there being someone ready to take advantage of your moment of disadvantage. Before you know it, you’re staring down the business end of a lawsuit.

This is why the best contractors are also great crisis managers. You need to think ahead to prevent legal disasters, or failing at that, think on your feet to weather the storm. This article will give you a set of tips on how to avoid disputes entirely, based on my experiences in the industry.

Get Everything in Writing

How to Avoid Disputes and Eventual Lawsuit_Get everything in writingMany disputes happen because the terms of a contract or agreement are vague and open for interpretation. And while it’s possible to argue based on unwritten policies in court, it isn’t something you’d want to leave to chance.

Think of how much of your operation is guided by arrangements made over the phone or in person, and how simple things can be when discussed aloud. Well, things can and will get very complicated, very fast when you hit a problem that wasn’t discussed beforehand. Worse yet, it’s entirely possible that your client might conveniently recall your conversation differently, in order to protect their interests.

Putting the terms of each policy and job into clear writing saves you a lot of trouble in the event that things go wrong. Make sure you cover everything from payment details to your policy on rescheduling –the more you’ve enshrined in writing, the more control you have over the different situations that might come up.

Drill Your Staff On Professionalism

How to Avoid Disputes and Eventual Lawsuit_Drill your staff on professionalismMost disputes arise because of something that happens (or doesn’t happen) while on the job. Naturally, this means that your employees and field workers will most likely be caught in the middle of events that lead to disputes, and will likely be the first line of response.

I don’t need to tell you to make sure your employees are competent and well-trained, but it helps to make sure they’re prepared to address mistakes and accidents with calm professionalism. Don’t let them give your clients the impression that they aren’t ready to handle situations like these, and send them out with a set of protocols in the event that they cause damage, or commit a similar error.

Instilling professionalism among your employees doesn’t only keep the situation from getting worse—it can prevent them from being any bad at all. People respond well to courtesy, sincerity, and a pleasant attitude. Conversely, they’re a lot more likely to respond harshly to workers who show attitude, make excuses, or display any kind of disrespect and incompetence. Remember: first impressions go a long way.

Lawyer Up

How to Avoid Disputes and Eventual Lawsuit_Lawyer upThis goes without saying, but paying for a lawyer to review your policies and help you draft your emergency protocols is worth the expense.

It might surprise you to hear that I’ve met a good number of contractors who aren’t aware of their basic legal obligations and the process behind drafting a contract that holds up in court. This is pretty much unacceptable for anyone who wants to run a business without being sued out of their work boots.

Take advantage of the fine men and women in the legal profession, and work with them to build up a good working knowledge of the law as it relates to your business.

Don’t Combat, Cooperate

As the owner of a small business, your primary goal is to serve your clients. Or, at least, that’s the impression you need to give off. Whether your business exists for service, profit, or a combination of both, cooperation is the best policy in the event that you find yourself at risk of a lawsuit.

If you find yourself on the edge of a legal dispute, your best shot is to come across as cooperative. You want to solve problems with your client, not wiggle out of accountability. Likewise, learn to make smart concessions and pick your fights carefully. Think of what you’d want to hear if you were in your client’s shoes, and do your best to give it to them.

At the end of the day, it’s far better to be known as a business that’s willing to help account for its mistakes than one that’d take you to court (which is what the public will see regardless of who throws the first legal punch).

What to Do When Faced with a Dispute

If all else fails, and you wind up having to turn to a third party to resolve your problems, all of the preceding advice stands. Be professional, be polite, and never take a combative position.

Your first concern here should be assessing your legal liabilities and finding a good lawyer—these things are largely out of your hands, and are best left to people who’ve built careers around handling them.

What you can control is the PR fallout that’s likely to follow. This is especially important for popular businesses, and contractors working in small, closely-knit communities. Do your best to put forward an earnest and trustworthy face, and avoid doing anything that looks like you’re trying to squeeze money out of a customer. If you’re on the side of the dispute that’s demanding fair compensation, make sure to keep your demands reasonable.

Finally, learn from the experience. Whether you win or lose the dispute, the whole ordeal should leave you better prepared to carry on with your business and better prepare you to avoid having to go through the hassle again in the future.


Shit happens when you’re on the job. No matter what industry you work in, that’s a fact of life. But if you take the time to prepare for them, and leave nothing to chance, you’ll find that there’s little to fear in the way of legal disputes and lawsuits.

Cover your bases, be smart, and put on your best smile.

About the author

Corey Philip

Corey Philip is a small business owner / investor with a focus on home service businesses.

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