Differing site conditions; confusing change orders; excess time and materials following a miscalculation; defective installation. These are just some of the reasons why a construction dispute may result in litigation. When that happens, the volume of electronic information exchanged in discovery can reach into the millions of documents. Despite such significant volumes of data, many cases hinge on just a handful of key documents. It is sometimes impossible to know which documents will be key at the outset. This makes preservation of potentially relevant data all the more critical.
Electronically stored information (ESI) is information stored or communicated using any digital or electronic method. A quick glance at any construction environment reveals the prevalence of electronic communications and reliance on electronic storage of data. Preserving that data for use in litigation, and understanding how to access it at a critical time, can mean the difference between success and defeat.
When a company suspects that it may become involved in litigation, it is under a duty to preserve relevant data. The failure to do so may not only harm the company’s chances, it may subject it to sanctions for the improper destruction of evidence. It is necessary when litigation appears possible to issue a litigation hold. This hold directs certain individuals and custodians of data to preserve that data and suspend any document or data destruction policies. Companies must first identify the key custodians of potentially relevant data to ensure that the litigation hold is properly communicated. Then they must also understand how the data is stored and processed, to allow for the development of proper protocols for preservation.
These considerations are applicable to nearly all businesses, regardless of the industry. Nearly every company employs computer systems and uses tools such as email to communicate both internally and with their customers, clients and stakeholders. But there are several unique aspects of the construction industry that require special consideration for preservation of data. Prime examples include apps that track vehicle movements, safety reports and data, and job progress. Contractors use apps to connect the home office with myriad equipment and devices in the field. Understanding how those apps store data, and who controls that data, is critical to preservation. It is not difficult to imagine the importance of data in a safety tracking app when an accident occurs. Nor is it hard to see the relevance of job progress data when a delay claim arises.
Yet another example is the sophisticated computer programs and tools, such as BIM, that allow contractors and architects to interpret and review architectural designs and drawings. Designed to increase collaboration and productivity, these tools create massive amounts of data, much of which may be stored in unique formats and locations. Understanding how to preserve this data is important, especially when a dispute arises.
Contractors also use special, sometimes proprietary, systems to order materials and supplies, track payments, and manage contract documents and change orders. Resolving disputes over material quality, payment, authorized changes or contractual obligations will require data contained within these systems. In the context of contract compliance, notice of a particular piece of information or condition often changes the game significantly. Understanding how electronic systems collect and store communications and data can make the difference in establishing notice at a critical point in the project, significantly impacting the outcome of litigation. Perhaps even more significant is the preservation of metadata associated with these files. For example, preservation of the file itself may be of little value without related information concerning when the file was created, when it was last accessed and who accessed it when.
The various players in the construction industry must be able to answer the “who,” the “what” and the “how” of data in order to properly prepare for litigation. They must know who has control of the critical data. They must know what is contained in that data. Finally, they must understand how the data is stored, how to access it and how to preserve it. Although all litigants are always bound by the facts of their situation, preparation is key to accessing and understanding all of those facts. This preparation enables litigants to effectively evaluate claims and position themselves for success.