A View from the Other Side
of a Construction Case Proceeding
by Judges Stanley P. Klein (Ret.)
and Arthur B. Vieregg (Ret.)
(Courtesy of Virginia Lawyer, Virginia State Bar. For a printable version of this article, please click HERE.)
For more than twenty years each of us has presided over trials, mediations, and arbitrations. Often, as we observed the proceedings, we wanted to advise the lawyers what they could do, and on occasion should do, but we were ethically constrained from doing either. Based upon your invitation, we are now free to tell you some of what we have wanted to tell you for years. Here we go!
A. Planning your strategy
Always have a strategy fully planned before your trial for how you intend to succeed in a construction case trial. There generally will be hundreds of documents that may be relevant and multiple witnesses who can testify to some aspect of the project; do not use them all! Instead, take the time before trial to determine the documents and witnesses you really need to produce and how you are going to use them to present a clear and cohesive message to the trier of fact. Ultimately, less is generally more!
Whether it is a jury trial or bench trial you must be careful to make sure that the trier of fact understands the language that you and your witnesses (especially experts) are speaking. Most jurors and judges do not know "construction language" and far too often attorneys forget that they must convince the fact-finder of the virtues of their case, not the other participants in the trial. Many attorneys appear to be more interested in showing how much they know by engaging the witnesses in "construction talk" and, as a result, they never connect with the jury or judge. This is particularly true with expert witnesses. As you know, in construction cases expert witnesses testify on myriad subjects, including construction, engineering, architecture, accounting, property and business valuations, as well as different science. It is simply impossible for jurors and judges to be conversant in all these and other fields of expertise. Avoid the temptation to show off for your client, opposing counsel, and the expert witness by engaging in a mode of questioning that may fly way over the heads of the fact-finders.
C. Educating Fact-Finders
Studies have shown that people learn differently. Some learn best by listening, some by observing, and others by interacting with the speaker. To the extent that you can, attempt to introduce information for the fact-finders through all three methodologies. In jury trials, the only give and take between counsel and the jurors takes place during voir dire. Take the time to prepare your voir dire questions in a way where you are most likely to engage the jurors in a conversation, hopefully about topics that relate to your theory of the case. In bench trials, invite the judge to interrupt you and any witness if the judge does not understand your question or the witness's answer. Some judges may decline your invitation but many others will gladly take you up on it. Whenever possible, include demonstrative aids in your presentation especially in opening statements. Make sure that you provide any such demonstrative exhibits to opposing counsel in advance and advise the trial judge that you have done so. If the fact-finders understand from the opening statement what will be presented during the trial, it will make it much easier for them to remain focused and appreciate the importance of the evidence as it is presented.
D. Winning Over Fact-Finders
Jurors and judges are human too! We are most likely to find a position convincing if it is presented by someone we respect and who makes our job as fact-finders easier. In bench trials, always make sure that the judge has separate exhibit binders so that the judge may utilize the exhibits in the judge's note-taking. Similarly, before the day of trial, see if counsel can agree on the admissibility of the key exhibits (e.g. the contract, the change orders, etc.), and if so, discuss whether binders of these key exhibits can be given to each of the jurors so that they can more easily follow the testimony and arguments about these exhibits as they are presented at trial. Always ask the judge to allow the jurors to take notes and bring pads with you for all of the jurors so that it will be easier for them to truly remember the evidence during deliberations, which in many construction cases may be weeks after the trial begins. In a similar vein, do not overload the fact-finder with every document that may be relevant to your case. Too many attorneys simply "dump" on the judge or jury all of the documents that pertain to the construction job at issue. If they are not worthy of some questions of the witnesses during the trial, they probably do not need to be introduced in evidence. Fact-finders in trials have a responsibility to review the entirety of all documents that are in evidence and may resent having to take additional time to review documents that do not really aid them in the fact-finding process. Take a look at new Evidence Rule 1006 and see if a summary of voluminous documents might better serve the presentation of your case.
E. Closing Arguments
Synthesize the evidence for the fact-finders, do not just rehash it. Jurors and judges (just like you) have limited attention spans. Tie the evidence together for the fact-finder so that you make it easier for the fact-finder to accept your theory of the case.
In bench trials, if the amount in dispute warrants it, ask the judge whether it would be helpful to submit closing arguments in writing so that you can refer the judge to specific exhibits or transcript pages that are vital to an understanding and appreciation of your case. Then, invite the judge to ask for oral closing arguments, if the judge deems it necessary after reviewing the exhibits and the written arguments. When utilizing this procedure urge the judge to advise counsel of the specific issues that the judge would like to hear about in the oral arguments so that you can focus on them in your presentation.
Ultimately, in any construction trial, be prepared, be professional towards all participants in the trial process and be considerate of the fact-finder. You will be two steps ahead of your opponent if you are.
A. Why not mediate!
Many cases wind up in trial or arbitration when mediation is actually a more effective way to resolve the dispute. In mediation, the parties themselves can choose the mediator and can provide the mediator with what is helpful to the process, whether admissible in evidence or not. Perhaps the most important reason to suggest mediation to your client however is that the parties themselves will remain the ultimate decision-makers instead of asking a stranger to the construction project to be the decision-maker. This empowerment of the parties themselves not only allows the parties to make their own business decisions about how to resolve the dispute but also significantly enhances the chances that the parties can work together on future projects.
It is not a message of failure by the attorney when you suggest mediation to your client. In many cases, a neutral can propose other avenues for the parties to find common ground. Also, in cases where the attorneys cannot settle because of unreasonable positions taken by their clients, upon learning from an experienced neutral that their attorneys' advice has been entirely reasonable, the parties may then be able to come to closure.
Always have the heart-to-heart conversation with your client before the day of the mediation so that your client comes to the mediation with realistic expectations about possible resolutions. Before you arrive, be prepared to make your first settlement proposal, whether you will be asked to get the negotiation going or responding to the other side's initial proposal. You can always tweak your client's intended initial position based upon the other side's opening settlement proposal.
Always make sure that you bring your client's ultimate decision-maker to the mediation and require the other side to do the same absent unavoidable circumstances. The process that leads up to the proposed final settlement is often just as important as the final number. If the ultimate decision-maker has not participated in the process and does not appreciate the compromises which have taken place along the way, it significantly hampers the parties' ability to find the common ground that should lead to a mediated settlement
D. Ex-Parte Contact
Remember, in mediation you can have ex-parte contact with the mediator before, during and, if necessary, after the mediation. After an appropriate period of time has elapsed at the mediation, if the mediator feels that he or she has learned enough information, upon request of the parties, the mediator can morph from being solely facilitative to taking on a more evaluative role in the discussion. Should that occur, look for cues from the mediator because he or she should have some sense of what is going on in both rooms. The mediator can then be an attorney's greatest asset in working with the attorney's client. If you do not reach the finish line during the mediation itself, encourage the mediator to have continuing contact with both sides after the mediation session. Many cases settle shortly thereafter with the assistance of the mediator.
In mediation, be prepared, be patient and persevere. Contrary to a trial or an arbitration where there will always be at least one party that perceives itself as the loser, in a successful mediation, both clients leave knowing that they made their own deal and, as a result, they are much more likely to leave satisfied and often gratified.
A. Preliminary Matters
Many form construction contracts require that disputes between the parties be resolved by arbitration. In other cases where a construction contract dispute arises, the parties and their attorneys may conclude arbitration is faster, less expensive, and more adaptive to their specific needs than a jury or bench trial.
If there is one over-arching word of advice we would advance, it is that counsel should cooperate with one another before the actual arbitration to ensure that the arbitration meets the needs of both parties.
Such cooperation should begin even before an arbitrator is chosen. Such cooperative efforts should address (1) whether the case justifies one arbitrator or multiple arbitrators; (2) the identity of an available arbitrator or arbitrators, who are "right" for the parties' case; (3) an agreed location for the arbitration; (4) the number of days necessary to conclude the arbitration; and (5) potential dates available for the parties, witnesses, and the attorneys. These issues will be addressed by the arbitrator in any event, but such "pre-first conference cooperation" will afford counsel the opportunity to discuss these and other issues before the arbitrator is involved.
i. Discovery - Discovery in arbitration runs the gamut from no discovery to discovery common in major litigation. Arbitrators will usually work with counsel to afford an opportunity for necessary discovery. Because extensive, needless discovery can defeat several primary benefits of arbitration -- savings of time and legal fees -- counsel should only seek to conduct discovery that is truly necessary. Counsel might also agree to exchange expert reports in lieu of pre-arbitration depositions. In some cases, counsel might agree to the submission of expert reports, deposition testimony, and interrogatories and responses thereto in lieu of live expert testimony at the arbitration hearing.
ii. Stipulations - Counsel should also cooperate to stipulate to undisputed facts. This will reduce the amount of necessary live testimony, will assist the arbitrator to focus on the evidence dispositive of the disputed issues, and should eliminate unnecessary costs to the parties. An attorney's resistance to stipulating undisputed facts is unlikely to impress even the most impartial arbitrator.
iii. Time - The allotment of time between "the litigants" for opening statements, presentation of evidence, and argument should also be discussed with the arbitrator as early as possible in the process. This is especially important if counsel wish to limit the arbitration to an agreed number of hours or days. In that event, counsel might ask that a record be kept of the time taken by each side to present opening statements and evidence, and to argue the case. An extension of time for good cause shown to a later hearing date may also be appropriate if the case is not presented in the time agreed upon.
iv. Notebooks for the Hearing - It is recommended that counsel consult before the arbitration as to the submission of three ring binders for the arbitrator, counsel, and the witnesses. They should contain key exhibits and relevant portions of deposition transcripts. With the consent of the arbitrator, they should be highlighted to emphasize portions that are especially pertinent.
v. Pre-Hearing Briefs - In advance of the preliminary arbitration conference, counsel should also consider whether the arbitrator would benefit from pre-hearing briefs outlining each side's case. Counsel should consider seeking permission to present such pre-hearing submissions even if not requested by the arbitrator. An informed arbitrator will be in a better position to follow the evidence and afford the parties a better decision.
B. The Arbitration Hearing/Evidence Presented
Construction cases often involve many players (owner, general contractor, subcontractors, design professionals, surety and insurance representatives, etc.). In medium to large construction cases, a core set of agreements, plans, insurance policies, etc., often will be dispositive of the arbitrator's final decision. Counsel should plan how to present the evidence necessary to prove or disprove his or her claim or defense.
Counsel should seek to present the most probative evidence and refrain from presenting superfluous evidence that often raises unnecessary issues. In the end, the arbitrator is likely to receive and analyze most of the evidence you present. However, filling the record with extensive cumulative documents or testimony will usually do little more than increase the cost of the proceeding. Furthermore, it may diminish the force of the most probative evidence you present.
C. The Award
Counsel should discuss what type of award is requested and inform the arbitrator(s) of counsels' expectations as early as possible. In most cases, findings of fact and an award of a dollar amount will be sufficient. In major construction cases, however, extensive findings of fact, conclusions of law, and a detailed award may be sought. Equally important, the parties should inform the arbitrator how soon an arbitration award is needed by the parties.
Although there is clearly some overlap in these different modes of dispute resolution, each presents potential advantages and disadvantages which should be fully considered and discussed with your client. Whichever mode you choose, there is simply no substitute for planning, strategizing, and preparation. And, whichever procedure you decide to utilize, being professional at all times will serve your client well.
Courtesy, Virginia Lawyer, Virginia State Bar.
Click HERE to view the profile of Hon. Stanley P. Klein (Ret.)
Click HERE to view the profile of Hon. Arthur B. Vieregg (Ret.)