As much as we would like to avoid them, it's almost inevitable that there will eventually be problems with clients that you cannot resolve. That's why, in this month's column, we will examine dispute resolution. First, however, we will take a look at ways to keep situations from escalating out of control.

In my December 2004 column, I reviewed ideas for managing customer expectations in order to keep tensions defused and under control. Enough cannot be said about the importance of addressing customer concerns as soon as they arise.

The key to managing your customers' expectations is to have a clear, concise contract with detailed plans and specifications. With the correct level of detail in your contract, there should be no confusion about what is or is not included in the work you are doing for the client. It is important, however, that these plans and specifications be reviewed in detail with the client, preferably with the client initialing each page of all documents. It's also important to include a clause in your contract that makes it clear that the contract is limited to only those things included in the written agreement and does not include anything that might have been discussed but not included.

More often than any other area, it's the subjective issues that will result in conflicts issues such as variations in the color of tile, graining in the cabinetry, sheen of the paint, etc. Part of the answer to these sorts of questions comes from properly educating your clients in advance. We can usually predict what these subjective issues will be and make sure they are discussed so that your client is prepared for them.

One way to address such issues is by employing a client handbook. Such a document can include many of the issues and subjects that need to be communicated to a client. It's also a good idea to have performance standards (such as those published by the National Association of Home Builders) referenced in your contract.

There are times, however, when a client focuses on an issue and it just cannot seem to be resolved. When you reach this point, you will have to decide whether to dispute the issue or give the customer what he or she is after.

Occasionally, you will encounter someone who simply does not want to reach a settlement and will continue to string together reasons that he or she does not want to make a final payment.

Dispute Resolution