Back to Blog Home

Dealing with Payment Disputes During the Pandemic

Payment disputes are not uncommon in the construction industry and with the pandemic hitting the country hard, it might be even harder to collect payments on construction projects.

So, what do you do when you can’t get payments on time during these crazy times? Even though we are still shuffling through a pandemic, construction contracts still need to be followed. 

Contracts should always include important details, especially the payment due date and the consequences if failed to make payment. However, if this information is not in the contract for some reason, you can still hold the other party liable for late or no payment. 

Payment Disputes

Cash flow is an issue during the crisis and unfortunately could impact your construction project. Following contracts and making payments on time are critical in the construction industry to keep it going. 

Dealing with delayed payments is always a nightmare and it could be a valuable thing to raise a claim when in the middle of a payment dispute. 

Usually, once a project is completed, full payment needs to be made. The current pandemic shouldn’t change this unless it has been discussed. Of course, any changes to a contract including payment should always be put in writing. 

Resolving Payment Disputes

Clear contracts in place are important to avoid payment disputes, but they can still occur. 

There are a couple of options to resolve a payment dispute.

You can always use an Arizona construction attorney to deal with the dispute on your own by threatening to take legal action. Sometimes this is all it takes to finally receive payment, but if not, you will need to be more aggressive by filing a construction lien. Unless you are working on a public works project, then a government claim will need to be filed.

A construction lien is when a contractor files a claim to receive a delayed payment. The construction project usually must be fully completed to move forward with these options.  

In the state of Arizona, you have six years to raise a dispute. This starts when the project is finished and you haven’t received payment in the timeframe that was included in your construction contract.

Working with a Construction AttorneyIf you have been caught in a construction contract dispute such as a payment dispute, our knowledgeable team at Murphy Cordier PLC has the experience handling construction law issues. We will be able to provide you with the legal guidance and representation you need in any construction law case.