Why We Started Conifac

Why We Started Conifac

Burns Logan

“We want to proactively resolve construction disputes. Lost time, reduced productivity, and tarnished reputations are not easy to repair.”

Construction professionals and business owners make better decisions when they control the discussion, rather than judges, juries, or arbitrators.   Unfortunately, quality dispute resolution mechanisms are often hidden behind a wall of legal processes and prohibitive costs.  If construction professionals were given the opportunity to take advantage of those processes earlier in the dispute, time, money, and reputations can be preserved.

We built Conifac to make sophisticated dispute resolution processes available to the construction industry earlier in the process and much more cost-effective than traditional dispute paths of litigation and arbitration.

By nature, construction managers are skilled in resolving disputes. They negotiate budgets. They negotiate schedules. They negotiate for materials and allocate personnel. Ironically, they never realize just how much they’re negotiating—it’s a major part of running a successful construction business. Handing a negotiation over to a legal department or outside counsel simply isn’t optimal.  Often, the dispute is taken out of the hands of the individuals who can best handle the issue.

Many disputes are unresolved because the parties simply do not trust that all the relevant information is being shared.  It is difficult for parties to explore the best ways to resolve a dispute when it is in each party’s best interest to withhold as much information as possible.  Negotiating with limited information requires each strategic move to be made in small, calculated increments. This leads to slow progress and increases the odds that no agreement will be reached.

Of course, there is a better way.  Many state laws allow parties to use dispute resolution processes, like Conifac’s, to negotiate disputes with a neutral third-party on a confidential basis. The Conifac process also requires the parties, through their agreement to participate, to agree that information exchanged shall not be used against any other party at a future date.  This is an extremely powerful legal technique.

Conifac’s process makes it easy for parties to communicate freely:

  1. First, the parties agree to enter into a “settlement process” so that all the parties can take advantage of the state laws that protect the confidentiality of the process.
  2. Second, Conifac’s professionals work closely with each of the parties individually to hear their side of the story and review the relevant documents (i.e. contracts, photographs, letters, etc.). Most of this work is done online without a need to travel.
  3. Third, Conifac works with all sides to clarify any outstanding questions and assumptions about the dispute.
  4. Fourth, Conifac works with the parties collectively to explore all of the possible solutions to the dispute. This may involve getting the parties together through an in-person or online meeting or it may involve Conifac proposing a solution to the parties.

Using Conifac allows the parties, via the Conifac representative, to ask questions, clarify priorities, evaluate their own position, and explore creative resolutions without the fear that they are sharing too much information.  It opens the door to a more commercially-driven negotiation.

The effectiveness of using mediation systems, like Conifac’s, has been recognized by all major construction contract organizations.  The AIA, ConsensusDOCS, AGC, and Home Builder Contracts & Construction Management Forms all encourage the parties to use similar processes to resolve disputes.

So, why is this process not more widely used in the construction industry early in the process?

There are two primary hurdles:

  • First, this process is often not presented to parties until after months or even years of costly arbitration or litigation. The best time to resolve a dispute is early on, especially while the project is ongoing. This is the primary time in which Conifac can provide maximum assistance. Outside counsel, many times, do not explore mediation-type processes until the parties are more entrenched in their positions later in the process.
  • Second, the process is rarely presented to disputes that have a low monetary value. Construction professionals often think that mediation processes, like Conifac’s, are only available after a litigation or arbitration is filed (it is available anytime) or that outside legal counsel is required (they are not!).

These misconceptions cost a lot in time and fees. Conifac aims to tear down this imaginary wall of costs. We’re on a mission to help parties resolve their construction disputes on their own terms, using experienced professionals, all at a lower cost than ever before.