Construction Lawsuits: What Michigan Contractors/Owner Need to Know

In Michigan the construction industry is one of the most regulated and high-risk industries, with legal disputes typically arising from contract disagreements, project delays, and/or safety violations. Whether you’re a contractor, developer, or property owner, understanding the some common causes of construction lawsuits and how to help mitigate legal risks is essential for protecting your business and investments is important.

Common Types of Construction Lawsuits:

Breach of Contract Disputes

Contracts define project scope, payment terms, and deadlines. When one party fails to meet obligations, disputes arise.

Common Breach of Contract Issues:

  • Non-payment for completed work

  • Missed project deadlines

  • Use of substandard materials or poor workmanship

  • Unapproved changes to project scope

Mechanic’s Liens and Payment Disputes

A mechanic’s lien is a legal claim used by contractors, subcontractors, or suppliers who have not been paid for their work.

Key Payment Dispute Triggers:

  • Contractors withholding payment from subcontractors

  • Owners refusing to pay due to project delays or quality concerns

  • Disputes over contract terms regarding payment schedules

Construction Defect Claims

Construction defects can result in serious financial losses and legal claims from property owners. These defects fall into four main categories:

  • Design Defects – Architectural or engineering flaws that affect structural integrity

  • Material Defects – Use of faulty or inadequate building materials

  • Workmanship Defects – Poor construction techniques leading to failures

  • Subsurface Defects – Soil instability or foundation issues due to poor site preparation

Contractors can face liability even years after a project is completed, making proper documentation and adherence to industry standards essential.

How Contractors/Owners Can Protect Themselves

While lawsuits are sometimes unavoidable, contractors and owners can take proactive steps to minimize legal risks:

  • Draft Robust Contracts – Ensure payment terms, deadlines, and dispute resolution clauses are clear.

  • Document Everything – Keep records of contracts, emails, invoices, and site progress.

  • Follow Safety Regulations – Maintain compliance with OSHA and MIOSHA standards to reduce liability.

  • Communicate Clearly – Regular updates with project stakeholders can prevent disputes.

  • Consult Legal Counsel Early – Address potential legal issues before they escalate into lawsuits.

How to Handle a Violation of Your NDA/Confidentiality Agreement

A confidentiality agreement, also known as a non-disclosure agreement or NDA, is a legal document used by businesses to protect trade secrets, proprietary information and intellectual property. Many employers require associates, contractors, and employees to sign a confidentiality agreement as part of their employment contract.

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Examples of Breach of Contract

Contracts are created to establish the responsibilities and expectations of parties that choose to engage in business transactions with one another, whether they involve business to business transactions, construction or licensing agreements, or the employee / employer relationship. They also provide for remedies for when things don’t go as planned.

At A|Squared Legal Group, we help clients prevent and mitigate damages that may result from a breach of contract which is the failure, without legal excuse, to perform any promise contained in a binding and legally enforceable contract.

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Your Business and Respondeat Superior

In this post, we’re going to discuss how business owners can prevent lawsuits caused by an employee. An employee’s conduct during the course of business can be the basis for a lawsuit against your company, this is referred to as “respondeat superior” which is Latin for “let the master answer.”

What is Respondeat Superior?

Respondeat superior refers to a situation when the conduct of an employee leads to a lawsuit against the company, opposed to the individual employee being sued because a company is deemed responsible for the conduct of its employees…

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