THE OKLAHOMA BAR JOURNAL 28 | MARCH 2025 Statements or opinions expressed in the Oklahoma Bar Journal are those of the authors and do not necessarily reflect those of the Oklahoma Bar Association, its officers, Board of Governors, Board of Editors or staff. Contract Time: Contract Days: 245 Notice to Proceed: March 30, 2024 Original Completion Date: Nov. 30, 2024 Days Granted in COs to date: 15 Revised Completion Date: Dec. 15, 2024 Claims should then be separately identified, with a short description and proposed cost/time impact for each issue. Backup documentation should be included to support the actual or estimated costs for each issue (see above for examples). This includes both claims of a contractor or subcontractor for extra work, as well as claims by an owner to correct deficiencies, repair damaged property, etc., if any. Likewise, claims for additional time should be backed up by schedules, weather data and other documents demonstrating actual or potential time impacts. If attorneys’ fees, costs and interest are available under the contract or applicable law, they should be included in the summary of damages. Of course, what the client desires may not be allowed under the law or the parties’ agreement. Damages are generally available in an amount needed to place a plaintiff in as good of a position as they would have been had the contract not been breached.3 So if a homeowner spends $250,000 on the construction of a new home but later sues the contractor for $1 million to remedy alleged construction deficiencies, it is very likely that such damages would be held unreasonable and, therefore, not recoverable. In the context of mediation, starting negotiations in such a manner could be a nonstarter for the contractor/seller of the home. There could be other limitations contained within the contract. For example, your client may contend they are owed money due to job prolongation, but there is a “no damage for delay” provision disallowing such damages. There could be an exculpation clause disallowing claims for unforeseen site conditions, a consequential damages waiver or a pay-when (or if) -paid provision in the agreement. There could also be legal hurdles to overcome, such as problems with the perfection of a lien or bond claim, statute of limitations or statute of repose. In the case of property damage, the law might limit the owner’s damages to either the cost of repair or diminution in value if the cost of repair is impracticable.4 Including a claim that is flatly not viable can sometimes have a chilling effect on negotiations. For this and other reasons, deciding what to include in a demand should be heavily scrutinized, and reasonable expectations should be developed early. Counsel should carefully explain to their client any shortcomings when determining the list of damages versus what a negotiated compromise might look like in mediation. Sharing Information As paid pugilists, the job of a litigator often does not contemplate freely sharing information with opposing parties unless ordered to do so by a judge or arbitrator, statute or court rule. However, in the context of mediation, there usually are more benefits to sharing than there are to withholding information. Providing a target. As noted above, providing clear and concise damage calculations is imperative to success at mediation. Parties who understand how much is being claimed and how the amount was calculated will be in a far better position to settle than if damages are vague. Even if they do not agree with the claim, the party expected to pay will be in a much better position to offer something reasonable if they understand what is being claimed and how it was calculated. Indeed, for the party seeking payment, arriving at a clear settlement demand is just as important as it is for the party expected to pay. Besides potentially maximizing a recovery, arriving at an opening demand is a great opportunity for counsel to work through all the issues with their client’s claims and set reasonable expectations for when negotiations begin in earnest. A good damage model should also convey to opposing parties the strengths of your client’s claims and provide a framework for what a result at trial or arbitration might look like. Sharing backup. Unless they are voluminous, it is usually better to share with the other parties the documents gathered and the timeline prepared for mediation. When confronted with specifics backed up by contemporaneous project records, the parties’ discussion should become far more focused with fewer distractions. Besides focusing the parties on what is at issue, sharing can also have other beneficial effects, such as demonstrating a willingness to work toward a fair compromise and enabling opposing parties and the mediator to fully understand your client’s position. But again, caution must always be used to avoid providing too much information, which can lead to confusion and/or needlessly increase mediation costs.
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