In large-scale commercial construction, disputes aren't a matter of if — they're a matter of when. Bill Shaughnessy and I recently co-authored a practice note for LexisNexis' Practical Guidance about representing owners in construction litigation. Here are a few key insights.

The "Deep Pockets" Problem

Judges, arbitrators, and juries often view owners as the party with the money — the entity trying to avoid paying contractors who did the actual work. That's why owner claims must go beyond legal technicalities. They need strong economic justification that demonstrates fairness and proportionality. Credibility matters as much as the merits.

Litigation Readiness Starts in the Contract

The time to prepare for litigation is before you sign — not after problems emerge. Prioritize indemnification clauses broad enough to cover subcontractor defaults and regulatory violations, schedule provisions with acceleration clauses, liquidated damages that reflect reasonable estimates of actual harm (never call them a "penalty"), and venue provisions that favor your interests.

Two Often-Overlooked Essentials

First, evidence preservation. The moment a dispute appears likely, issue a litigation hold on everything — daily reports, RFIs, emails, texts, and photos. Meet with your project team immediately to capture recollections while details are fresh.

Second, don't forget the bond. Performance bonds are triggered only upon declared default and strict compliance with bond terms. Communicate early with the surety and obtain consent before significant change orders.

Read more in depth on this topic in the full practice note on LexisNexis.