Joining parties in a complex construction litigation case involving millions of dollars of damages is not to be done lightly. If counsel is not careful, it is easy to wind up with 50 or more parties, each of whom has to be served with every pleading, motion, letter, discovery request, expert report and everything else that is sent out in the litigation. This can cost tens–sometimes hundreds– of thousands of dollars each year that the case continues.
If a party is going to be joined, careful thought must be given to what it will cost to add that party, and what recovery is likely to be obtained. We have seen complex cases where a party is joined because of a relatively small claim. That party then files a third party complaint, and brings in two other parties seeking contribution or indemnification. The three of them get involved in a series of disputes about who did what on the project. Each party serves extensive discovery requests on the plaintiff and on each other. Experts have to be hired for each party and site inspections have to be arranged. By the time everyone gets done with all of that work, the amount to be recovered has been dwarfed by the amount of attorney’s and expert fees and costs expended. This causes aggravation and delay for all involved and in the end, no one is happy with the outcome. Thus, even if the plaintiff has a perfectly valid claim, careful consideration has to be given to whether it is economically sensible to assert that claim.
Generally, experienced counsel knows that you follow the money in a construction litigation case. Common sense dictates that you assert and spend most of your time on the most valuable claims. You must make sure that you have a good understanding of insurance coverage issues, as well as the best experts you can find. Care has to be taken to plead your claims in such a way as to make it as likely as possible that the insurance carriers will refrain from disclaiming insurance coverage. For example, you will want to try to frame your pleadings to describe negligent rather than intentional conduct. Typically, CGL policies exclude claims for intentional conduct but cover negligent conduct. In a similar vein, counsel will want to carefully consider whether he/she wants to plead fraud claims because they involve proof of intentional conduct that is beyond the scope of CGL policies.
Once the initial investigation and preparation of pleadings is complete, counsel has to assimilate the documents and interrogatory answers, and then get ready for depositions. This is the most important part of discovery because you are getting answers directly from the witness without counsel coloring the answer as typically occurs when interrogatories are answered by counsel and then affirmed by the client.