Construction and architects’ law
Risk management During the proceedings
Due to the large amount of evidence that must be collected and presented, and the specialist reports that are usually required, court actions relating to construction and architects’ law require significant resources and are expensive. As a result, these areas of the law are typically excluded from legal insurance coverage. Even though a settlement might be possible in many cases, claimants often shy away from lawsuits in order to avoid the financial risk associated with it and a protracted battle in court.
The following examples present scenarios within construction law for which litigation funding would be possible:
The M. heating and plumbing enterprise was commissioned by a general contractor to perform work in the heating, plumbing, and ventilation trades. Despite having agreed on a payment plan, the general contractor fails to pay the interim invoice issued by the M. company. The latter requests security for the building trade, and when said security is not provided properly, the M. company proceeds to terminate the contract for work and services. At this point, the M. company demands compensation for work and services both provided and not provided. When out-of-court proceedings fail to be brought to a close, ROLAND ProzessFinanz provides funding for the action for compensation for work done.
The private builder-owners K. commission an architect with the complete architectural service for a newly-to-be-constructed single-family home. After completion of the construction, several deficiencies become apparent. The builder-owners initiate independent proceedings for the taking of evidence. The court-appointed assessor determines there to have been planning and monitoring errors. Since the builder-owners hesitate to take on further costs, ROLAND ProzessFinanz provides funding for the action against the architect for compensation of damages.
A commercial building developer commissions architect D. with the planning and monitoring of the construction of a residential and office building, along with its appurtenant underground parking lot. Upon the architect having submitted the design planning and cost estimate, the developer terminates the business relationship with the architect. The latter draws up a final invoice, demanding payment of a fee for services provided and not provided. When the developer refuses to make payment, D.’s lawyer turns to ROLAND ProzessFinanz. ROLAND provides funding for the action for payment of a fee and assumes the costs for the required specialists.
A public building owner commissioned architect G. with the complete architectural service for the refurbishment of an integrated comprehensive school. Because of disagreements during the monitoring of the construction process the building owner ceases paying the architect’s interim invoices. After completion of his performance and consultation with a lawyer, G. prepares his final invoice in accordance with the minimum rates pursuant to the Honorarordnung für Architekten und Ingenieure (HOAI, German Regulation on the Fee Structure for Architects and Engineers). ROLAND ProzessFinanz provides funding for the action for payment of a fee. The suit was dismissed by the court of first instance; now, before the appellate court, the parties agree on a settlement after the court had obtained an expert opinion.