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June 2009

Forensic Construction Accounting a.k.a. “Who Owes Who How Much Money?

Presented by Stevem Podesta, The Owner’s Advocate

Who owes who how much money? That is the question new Westcon member Steven Podesta must answer as an expert in forensic construction accounting. In one instance, a contractor insisted that he was owed $203,000 until the eve of trial when he agreed to pay Steven’s clients $150,000. Another contractor claimed he was owed $97,000, but the arbitrator ruled that he must pay Steven’s clients $360,000.

Attorneys involved in course-of-construction disputes need to know what really happened before a case goes too far. One of  the first attorneys who hired Steven said, “I’ve been avoiding these boxes of docs for months and have no clue where to begin. I need you to create clarity from chaos and give me an objective analysis so that I know if I have a case.”

When a dispute about monies owed arises on projects that have not had competent construction administration, it can be very difficult for a third party to reconstruct what happened in order to determine who owes who how much money. Steven compares it to re-assembling an F-15 fighter without the manual. Piecing together the story might require the analysis of 5,000 pages of documents one day, crawling under a house the next day and pulling information from stressed out, screaming clients the following day. In fact, there are times when Steven’s years of volunteer crisis line work are more valuable than his construction experience.

Though he has worked as a consultant helping homeowners and nonprofits plan and manage projects since 1989, most of his work these days is dispute resolution and course-of-construction investigations on residential and small commercial projects. His goal, if attorneys are not yet involved, is to help contractors and owners resolve disputes without “taking it to the next level.”

When disputes do get more serious, attorneys appreciate Steven’s ability to take the stories, the physical evidence and the mountains of documents and weave them into concise, compelling course-of-construction claims.

Working more often for owners than for contractors (since many contractors don’t seem to believe they need an expert), Steven has found that virtually all course-of-construction investigations turn up “errors” in contractors’ charges and problems with incorrect/defective construction.

Please join us at our June meeting when Steven Podesta will discuss some of his recent cases and explain how he helps divide the money pie.


 

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