Authority Industries Dispute Resolution Process

When a home service project goes wrong — missed deadlines, disputed invoices, workmanship failures — homeowners and contractors need a structured path toward resolution that does not immediately escalate to litigation. This page explains how the Authority Industries dispute resolution process is structured, what triggers a formal case, how decisions are reached, and where the process has defined limits. Understanding this framework is relevant to anyone engaging with the Authority Industries consumer protection framework or evaluating a contractor through the network.

Definition and scope

A dispute resolution process, in the context of home services, is a formalized sequence of review, mediation, and adjudication steps that sits between informal complaint and civil litigation. The Authority Industries process applies specifically to transactions and service engagements that involve network-listed contractors — that is, providers who have completed the Authority Industries vetting process and agreed to the Authority Industries contractor code of conduct.

The scope covers 4 primary categories of grievance:

1. Workmanship disputes — completed work alleged to fall below the standard represented at contract signing
2. Payment and invoicing disputes — disagreements over billed amounts, change orders, or withheld final payment
3. Project abandonment — contractor failure to complete agreed scope without documented cause
4. Conduct and compliance failures — violations of licensing, insurance, or behavioral standards established at onboarding

Disputes arising from circumstances entirely outside the contractor-homeowner engagement — such as municipal permitting delays or manufacturer product defects — fall outside this process and are noted as structural exclusions.

How it works

The process runs in 3 sequential phases. Advancement to each next phase requires documented failure to resolve at the prior level.

Phase 1 — Direct Negotiation (Days 1–10)
The disputing parties are expected to communicate in writing using the network's documented communication log. A 10-day window is allocated. If a written agreement is reached and signed by both parties, the case is closed at this phase with no further escalation.

Phase 2 — Facilitated Mediation (Days 11–30)
If Phase 1 produces no resolution, a neutral case facilitator reviews submitted documentation — contracts, photos, payment records, correspondence — and schedules one or more structured sessions. The facilitator does not render a binding decision; the facilitator's role is to identify points of factual agreement and propose settlement options. Mediation at this level resolves the majority of cases that reach it, based on industry patterns documented by the American Arbitration Association (AAA Consumer Arbitration Rules).

Phase 3 — Binding Arbitration (Days 31–60 target)
Cases unresolved after mediation proceed to binding arbitration under rules aligned with AAA or JAMS (JAMS Arbitration Rules). An independent arbitrator reviews all submitted evidence and issues a written decision. This decision is enforceable under the Federal Arbitration Act (9 U.S.C. §1 et seq.), meaning either party may seek court confirmation of the award if necessary.

Common scenarios

Disputed final payment after punch-list disagreement
A contractor claims project completion; the homeowner identifies 6 unresolved deficiencies. This is the single most common dispute category in residential construction, per the American Institute of Architects. The Phase 1 negotiation log typically serves as the primary evidence base in arbitration.

Undisclosed subcontractor substitution
A licensed contractor listed in the network substitutes an unlicensed subcontractor without homeowner notice, violating standards outlined in Authority Industries licensing requirements by trade. This triggers both a dispute case and a compliance review running in parallel.

Change order pricing disputes
Homeowners challenge verbally authorized change orders that appeared on final invoices without written sign-off. The Authority Industries pricing transparency standards require written change order acknowledgment; absence of documentation becomes a dispositive factor in Phase 3.

Project abandonment mid-construction
If a contractor stops work, the homeowner may file a Phase 2 case directly (bypassing Phase 1) when the contractor is unreachable after 5 documented contact attempts over 72 hours.

Decision boundaries

Not every outcome the disputing parties might want falls within the authority of this process. The following boundaries are structurally fixed:

• Compensatory damages ceiling: The process handles disputes up to the full contract value plus documented consequential costs directly traceable to the dispute. It does not award punitive damages — those remain a matter for civil courts.
• Criminal conduct referrals: Fraud, theft, or licensing fraud allegations are referred to the relevant state contractor licensing board and, where applicable, to the consumer protection division of the state attorney general. The Federal Trade Commission's guidance on contractor fraud (FTC Consumer Advice) applies as a baseline reference.
• Insurance claim interface: Where a dispute involves property damage that triggers a homeowner's insurance policy, this process runs concurrently with — not instead of — the insurance claim process. The Authority Industries insurance standards framework governs contractor-side coverage requirements.
• Binding vs. non-binding phases: Phases 1 and 2 produce no enforceable obligation unless both parties execute a written settlement. Only Phase 3 arbitration produces a binding, court-confirmable award.

The distinction between mediation (Phase 2) and arbitration (Phase 3) mirrors the distinction recognized by the AAA: mediation is collaborative and consensus-dependent; arbitration is adversarial and decision-dependent. Parties who skip to arbitration without good-faith participation in mediation may face procedural disadvantage in cost allocation under the arbitrator's discretion.

References

• American Arbitration Association — Consumer Arbitration Rules
• JAMS Comprehensive Arbitration Rules and Procedures
• Federal Arbitration Act, 9 U.S.C. §1 et seq. — House Office of the Law Revision Counsel
• Federal Trade Commission — Hiring a Contractor (Consumer Advice)
• American Institute of Architects — Owner-Contractor Agreements
• U.S. Small Business Administration — Resolving Business Disputes