More construction litigation ahead as economy picks up

As the economy begins to improve and more construction projects get underway, it’s safe to assume that more construction litigation in Louisiana is just around the corner. And while no big headlines are in the Louisiana papers as of late, other states are already seeing an increase in construction and the disputes that often come with it.

In upstate New York, for instance, a company that operates a shopping center claims it was denied the right of first refusal when the shopping center was sold to a realty development company. Specifically, the operating company claims it was entitled to match the offer for the supermarket before the shopping center was sold. The company has asked the court to cancel the sale of the property and stop the owners from selling without first offering the business to the operator.

In response to the litigation, a number of the shopping center’s related entities filed a countersuit. These entities claim that the lawsuit brought by the operating company threatens the sale of the property. The countersuit seeks the court’s permission to move ahead with the demolition of the existing structure and building a new shopping center on the same property. The counter litigation seeks $16.4 million in damages.

The owners of the property argue that the operating company was never entitled to the right of first refusal because the supermarket was being liquidated and the building was scheduled for demolition. The store operators reject these defenses and argue that the property owners are trying to commit fraud and deny the operating company its right to first refusal.

It will be interesting to see what the court decides as the two sides present their arguments.

The case illustrates both the complexity and everydayness of construction litigation and contract disputes. However, fluency in construction law is nonetheless indispensible for the equitable resolution of any potentially costly dispute.

Source: Times Herald-Record, “Thruway plans draw lawsuit,” James Walsh, March 30, 2012