The real estate industry can fraught with legal risk. Whether you’re a developer, investor/lender, landlord, commercial tenant, broker, or property manager, disputes can arise at any stage of a real estate transaction or business operation. When disagreements escalate, real estate business litigation may be necessary to protect your interests and enforce your rights.
Understanding the most common types of real estate business disputes—and how to effectively resolve them—can help you avoid costly mistakes and unnecessary conflict.
Common Types of Real Estate Business Disputes in Colorado
- Breach of Contract
Contracts are the backbone of most real estate deals—purchase agreements, leases, development contracts, brokerage agreements, and more. A breach of contract occurs when one party fails to uphold their end of the deal, whether by missing deadlines, failing to deliver services, or not making payments.
Example: A buyer backs out of a purchase agreement without valid cause, or a seller refuses to close despite meeting all contingencies.
Resolution Options: Contract disputes often require close analysis of the written agreement, negotiation, or court intervention to enforce specific performance or award damages.
- Partnership or Joint Venture Disputes
Many real estate ventures in Colorado involve partnerships, limited liability companies (“LLCs”), or joint ventures. These business arrangements can turn contentious when there’s a disagreement over management, profit distribution, exit strategies, or contributions of time and capital.
Example: One partner accuses another of mismanaging funds or making decisions outside the scope of their authority.
Resolution Options: Operating agreements, bylaws, or partnership agreements often govern disputes. Mediation, arbitration, or litigation may be necessary or required to resolve financial problems and management disputes, effectuate a buy-out, or even dissolve the entity.
- Title and Ownership Disputes
Ownership of real property can be clouded by conflicting deeds, liens, or boundary disputes. These issues can disrupt sales, financing, and development plans.
Example: A buyer discovers after closing that another party has a claim to part of the property due to an undisclosed easement or inheritance issue.
Resolution Options: Title insurance claims, quiet title actions, or declaratory judgment lawsuits can resolve ownership problems and/or obtain compensation.
- Landlord-Tenant Disputes (Commercial)
In the commercial real estate world, landlord-tenant conflicts can arise over lease terms, improvements, maintenance obligations, rent payments, or early termination.
Example: A tenant stops paying rent after alleging the landlord failed to make necessary repairs; the landlord begins eviction proceedings.
Resolution Options: These disputes may be resolved through lease interpretation, negotiation, or court action—often involving claims of breach of contract or warranties, constructive eviction, or specific performance.
- Construction and Development Disputes
Large-scale developments often face disputes over construction delays, quality of work, payment issues, or unmet zoning and permitting requirements.
Example: A contractor fails to meet a completion deadline or delivers subpar work, causing financial harm to the developer.
Resolution Options: Resolution may involve mechanic’s lien claims, breach of contract lawsuits, or performance bond enforcement.
Methods for Resolving Real Estate Disputes
While some disputes inevitably end up in court, many real estate conflicts can be resolved through other legal strategies. Here are a few common methods:
- Negotiation
The simplest and least expensive route, negotiation allows parties to reach a mutually beneficial resolution without formal proceedings. However, sometimes parties need to hear from someone outside of their adversary to come around.
- Mediation
A neutral third-party mediator (usually a retired judge or a long-time practioner) helps the parties communicate and work toward a compromise. Mediation is faster and less adversarial than litigation, but does not always result in a definitive outcome.
- Arbitration
Arbitration is a private, binding process where an arbitrator (or panel) makes a decision after hearing both sides. It can be quicker than litigation in court, the outcome is more difficult to appeal, and is often required by contract.
- Litigation
When other methods fail or legal clarity is needed, litigation provides a formal process for resolving disputes in court. Litigation may be necessary to protect your rights—especially when fraud, misrepresentation, or large financial losses are involved.
Final Thoughts for Colorado Property Owners and Real Estate Professionals
If you’re involved in a real estate business in Colorado—whether as an owner, manager, commercial landlord or tenant, investor, or developer—you’ll likely encounter disputes that could threaten your investment or operations. Don’t wait for the conflict to escalate.
- Review your contracts regularly.
- Establish clear governance procedures in business ventures.
- Seek legal advice before reacting emotionally to disputes.
- Document everything—from memorializing conversations in emails to having clear financial records.
And if you’re already facing a serious dispute, working with an experienced Colorado real estate litigation attorney can help you identify the best resolution strategy, whether that’s negotiation, mediation, or taking your case to arbitration or court.
Your property, your rights, and your business are valuable assets. Make sure your legal strategy is protective in real estate business litigation. Talk to the dedicated real estate business litigation lawyers at Keating Wagner for more support.
