Chart out all the worst case scenarios and see how your contract can protect you in those scenarios .I know talking to Attorneys is not the most pleasant thing when you are paying 400 $/hr , but if the project is large scale or if you intend to do this on a regular basis , get the contract drafted by an attorney well versed in litigation/arbitration/mediation .I have been doing this exercise since the past 15 days  so if any one is in this phase of hiring a contractor , we could definitely bounce some ideas off

I would ask the contractor to correct these problems now and or negotiate a price with him and pay him for the work he has done before you end up at the wrong end of this in court or in arbitration.

Attempt arbitration/mediation (is this effective?)

I'm actually a real estate appraiser working on an arbitration assignment. 

Also, the state of formation is likely where internal disputes would be brought among LLC members, so if you and a partner and/or spouse live in CA, you probably want to arbitrate in CA if the two of you had a disagreement.

I think the NAR Code of Ethics (COE) Rule weakens the seller's negotiating position - which is an attack on the fiduciary relationship that the same COE purports to protect.The other is that NAR members agree not to sue each other, going instead to arbitration. 

The arbitrator worked with us and we agreed upon them being out in seven days from that date.

In my case seller was likely going to lose if this proceeded to an outcome (either arbitration or verdict) because he definitely knew of the issue and did not disclose it.  

At the aggriment we sighn that resputers shell be resolved by binding arbitration. 

When I took them to small claims, the court directed many of us to do arbitration.