Rocco Ruso has seen this play out on project after project: a contractor hits unexpected subsurface conditions mid-dig – contaminated soil, bedrock, hazardous gases – that weren’t identified in the geotechnical reports, adding cost and complexity.
Rather than stop and alert the owner, the crew keeps working, assuming it can be sorted out later. By the time it’s raised, the issue has already escalated into something far more difficult to resolve. On large transportation and other government infrastructure projects across Ontario – where multiple contractors and consultants are working under demanding schedules – the misconceived assumption that the issue will “sort itself out” almost always escalates into litigation.
“It’s never the case where you should just continue to work, fix the issue, and not tell the world,” said Ruso, principal and founder of RAR Litigation, a construction law firm with extensive experience in infrastructure disputes. “Make sure you communicate it and you do it in writing. Everyone needs to appreciate what the issue is.”
It’s a lack of communication that is at the heart of what Ruso sees driving disputes on Ontario infrastructure projects – and what separates the projects that run smoothly from those that end up in court.
What differentiates successful projects
Ruso says the projects that proceed most successfully are typically the ones where communication starts early and remains consistent throughout the job. Problems are identified quickly, expectations are clearly understood, and parties address issues before positions harden into disputes.
“Projects where there’s a robust pre-qualification process – so you know who it is that you’re working with – if you’ve worked with the subcontractors before, or you shortlist certain subcontractors that you know have the financial and the professional capability to perform the work, that is the recipe to ensure the project runs smoothly,” said Ruso.
Collaboration also plays an increasingly important role in how some projects are being structured contractually. Ruso points to growing industry interest in collaborative contracting models, such as alliance agreements and integrated project delivery (IPD), which are intended to align key project participants earlier in the process. “The core philosophy is to solve the project at the beginning before building it,” said Ruso.
These models bring owners, consultants, and contractors together earlier to identify risks, refine project planning, and improve alignment before construction begins. While collaborative delivery models are not a replacement for dispute management practices, Ruso says they can help reduce friction on complex infrastructure projects by addressing issues proactively.
Where disputes begin
The seeds of most disputes are planted long before shovels hit the ground, Ruso says. Incomplete tender documents, insufficient site investigations, unclear contract provisions, and procurement decisions based solely on price can create conditions where conflict becomes almost inevitable once work begins – particularly on large infrastructure projects involving multiple parties, evolving site conditions, and demanding schedules.
Many of the disputes Ruso handles involve parties who have never worked together before. Without established working relationships or clearly aligned expectations at the outset, disagreements can escalate more quickly once challenges emerge on site.
Most disputes ultimately trace back to one issue: money. When financing falters, payment slows. When payments stall, the trust behind the project begins to collapse – and friction follows. “It’s always the case that when a project isn’t sufficiently funded, the flow of payment is impeded,” said Ruso. “When there’s no money, there’s a lot more friction.”
In addition to non-payment, Ruso identifies several pressure points on projects that tend to escalate into formal disputes:
- Design deficiencies, where an insufficient base design leads to conflicting interpretations and unclear specifications
- Excessive scope changes through change orders that alter the agreed-upon scope of work
- Unforeseen schedule delays and disputes over who bears responsibility
As disputes escalate, communication often becomes more formal, and parties begin relying on the dispute resolution procedures set out in the contract. At that point, the dynamic shifts. “When claims begin, that’s when everybody starts getting their back up against the wall,” said Ruso.
Documentation and notice
For Ruso, the most consistent predictors of successful claims are two‑fold:
- Whether notice was provided in accordance with the contract documents
- The quality of the evidence supporting the claim
Courts are clear – failing to meet notice requirements can be fatal to a claim, particularly where notice provisions are treated as a “condition precedent” to advancing that claim. Just as critical is the documentation behind it: daily reports, photos, correspondence, and site records that establish when an issue arose and how it impacted cost or schedule. That’s why Ruso recommends that contractors assign someone specifically to contract compliance and project documentation – a role with no other responsibilities.
“Even if you have external counsel, external counsel can’t be with you in real time, all the time,” said Ruso. “It’s good to have someone who has no other responsibility than contract compliance and project documentation.”
The goal is not to avoid disputes entirely – it is to prevent them from materializing into protracted and expensive litigation.
This approach is agnostic as to whether the contractor has 50 employees or 5,000. While larger firms are more likely to have in-house counsel, every contractor – regardless of scale – benefits from involving external legal counsel early, before a dispute fully forms.
“The first time you call a lawyer shouldn’t be when the dispute entirely escalates,” said Ruso. “It should be early in the process, [where] they are assisting you, even if it’s behind the scenes, in preparing for a potential claim or lawsuit, such that they have all their ducks in a row.”
This is what makes a strong claim
The strength of any claim depends heavily on its preparation, which begins long before the claim is filed. A well-documented issue – where proper notice was provided in accordance with the terms of the contract – improves a party’s chances of successfully prosecuting its claim. “The dispute is crystallized to the extent that the party making the claim can clarify what the nature of the claim is and what the nature of their objection or issue or complaint is,” said Ruso.
A well-organized, well-evidenced claim signals to the other party that the issues are valid and the dispute is supported, which can prompt early discussions for resolution, he says.
Communication over confrontation
Ruso’s advice to contractors is straightforward: communicate early, document thoroughly, and treat every issue as though it may become a claim. “No longer is it the day that these things get managed at construction meetings, verbal representations, or back-of-the-napkin agreements,” he said. “They need to communicate, they need to document and evidence their file like they’re going to, in fact, be prosecuting a claim.”
Ruso warns that clients who are too aggressive at the inception of the project prematurely create long-term problems. Typically, those same clients are overly litigious. “If I have a client that’s too litigious, it becomes a concern to me, at least as counsel, that they won’t be around in 10 years,” he said.
Ruso is clear that involving legal counsel early is not about escalating tension. The most effective use of a lawyer, he argues, is as a shield rather than a sword. The goal is not to avoid disputes entirely – it is to prevent them from materializing into protracted and expensive litigation.
“The most successful files that I have been responsible for are files for which the other side doesn’t even know I’m involved,” he said.
Before engaging in litigation, consider partaking in early mediation or other forms of alternative dispute resolution procedures. These tools work best when the dispute is already well-defined.
Prompt payment and the Construction Act
One of the biggest factors shaping construction disputes in Ontario is the evolution of prompt payment and adjudication under the Construction Act. The Construction Act, formerly the Construction Lien Act, which received royal assent on Dec. 12, 2017, introduced the concepts of prompt payment and adjudication and came into force on Oct. 1, 2019 – has been further amended by Bill 216 (Building Ontario For You Act (Budget Measures) and Bill 60 (Fighting Delays, Building Faster Act, 2025) and came into effect Jan. 1, 2026.
Regarding adjudication, Ruso calls it “swift justice.” Adjudication provides an interim resolution to ensure that the parties can continue their work on a project on the basis of a binding determination. It is a structure Ruso says has meaningfully improved cash flow on projects. And as for prompt payment, Ruso explained, “A contractor on a multi-year project can ensure that it’s paid in accordance with the timelines under the Act, which are very aggressive.”
Ontario was the first province to implement these amendments, and others are following. British Columbia’s corresponding legislative changes are expected to take effect in spring 2026, Ruso says.
Practical advice for contractors
The issues that escalate into disputes are rarely unexpected – but they are often handled too late. Ruso offers three recommendations for contractors bidding and working on infrastructure projects.
First, ensure credit checks are performed and owner financing is confirmed. Second, read the contract in full – not just the key schedules – with legal assistance. Third, invest the time upfront to gather all available information before pricing the work. “Look at the document,” he said. “Basically, this is the document that will dictate whether or not you’ll be successful on a project.”
The difference is often not the issue itself – it’s how early it’s recognized and how well it’s documented.
