Archive for the ‘Construction Claims’ Category

Contractors! Are Your Claims Responded to Correctly?

EC Harris’ (now Arcadis) Global Construction Dispute Report has, for many years, cited inadequately expressed claims as being one of the top five causes of disputes in the construction industry.

Although the reports do not specifically mention it, I suspect that inadequately and unfair determinations should also be somewhere near the top of this list. This is because over and over again, attendees at our courses complain that their claims have not been responded to either fairly or in a meaningful way.

So, what is the problem?

If we look at the FIDIC forms of contract as being fairly typical of the widely-used forms of contract, we can see that the Engineer has the following obligations when responding to claims:

  1. Respond to the claim within 42 days – Sub-Clause 20.1 (Contractor’s Claims);
  2. In a case of rejection, respond with detailed comments – Sub-Clause 20.1 (Contractor’s Claims);
  3. Include sums that the Engineer considers to have been reasonably substantiated as being due in interim payment certificates – Sub-Clause 20.1 (Contractor’s Claims);
  4. Consult with each party to attempt to reach agreement – Sub-Clause 3.5 (Determinations);
  5. Make a fair determination in accordance with the Contract – Sub-Clause 3.5 (Determinations);
  6. Give notice to parties with detailed particulars – Sub-Clause 3.5 (Determinations).

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Trying Your Luck – Where do you draw the line with your claim submissions?

I was recently asked a question by one of our distance learning students which, at some time or another, you may have asked yourself. The question was:

Where do you draw the line when it comes to ‘trying your luck’? Is it better to be realistic in your claim submissions, taking your own delays into consideration, or do you submit all, knowing that they’re incorrect, and wait for the Engineer to ‘catch you out’?’

Obviously, a scenario where the claim is solid and difficult to refute is preferred, but there will often be ‘grey’ areas when it comes to entitlement or quantum. When preparing claim submissions for clients, we give our client the benefit of the doubt within the claim and if the Engineer notices these or disagrees with them, then this will be a basis for negotiation. It’s always good to give the other side something where they can score a few points to show that they are doing their job. To answer the question though, I think that there should be two parts to my answer. (more…)

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Top 10 Secrets of Successful Subcontract Commercial & Claims Management

It is no secret at all that subcontracting is one of the highest risk sectors within our industry. Subcontractors suffer more than most from the mistakes and misdemeanours of others. If the project is poorly funded then the Main Contractor’s first course of action is to reduce outgoings. The easiest way to do this is to delay or limit payments to Subcontractors.

If the Main Contractor feels the pain of liquidated damages or the rejection of interim payment applications then the first to feel the impact will again be the Subcontractors (and often for reasons completely out with the Subcontractors’ own performance!). This is not the result of malice, rather an unpleasant commercial inevitability in jurisdictions without statutory protection for Subcontractors.  The reality is that the further you are away from the source of the project funding, the less likely it is that the cash will find its way to you.

However, there is much that the weary and / or wary Subcontractor can do to minimise their risk and maximise their recoveries. Here are our top 10:

“Back to Back” or “Pay when Paid”- Is it really? The authors of this piece very much doubt that this is indeed the case. What people declare as being “back to back” is rarely so. A Main Contractor may not have been paid for a variety of reasons. Unless those reasons expressly relate to your performance then you may legitimately ask why this has anything to do with you at all. Ask yourself “If the Employer never pays the Main Contractor does that mean I will never be paid?” Is that what you actually signed? We find this rarely to be the case and is often a cause of great confusion between Contractors and Subcontractors who blur the difference between the commercial reality of their financial position and the conditions of the Subcontract they have entered into. (more…)

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Construction Claims Basic and Intermediate E-Courses: What’s the difference?

We currently have two e-course options on the topic of Construction Claims: Basic and Intermediate. But what’s the difference? And which one should you take if you’re looking improve how you write and manage construction claims? In this blog we look at each course and answer those questions to help you decide which one could be best for you…
Construction Claims Basic E-Course

The Construction Claims Basic E-Course is our ‘no frills’ course. You get 24 video tutorials delivered via 6 modules that focus on:

  1. Contract Administration for Claims
  2. Types of Claims and Procedures
  3. Delay Analysis
  4. The Essential Elements to a Successful Claim
  5. Compilation and Presentation of Claims and Responses
  6. Responses, Determinations and Disputes

You simply sign up and work through the videos at your own pace. 

Construction Claims Intermediate E-Course

By comparison, the Construction Claims Intermediate E-Course offers a more practical and involved learning experience.

You still get 24 video tutorials delivered via the same 6 modules but you also get: (more…)

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E-Course Trial | Leveraging Lessons and Implementing Improvements

It’s no secret by now (we hope!) that Claims Class is launching e-courses in 2017 and, over the past couple of months, we have been running a trial of our first e-course, a Construction Claims Intermediate E-Course.

Running the trial was definitely a worthy exercise. We gained some great feedback from our students and learnt some valuable lessons ourselves, all of which have gone into improving the course and creating the final version. In this blog, we explore the trial process, share the key takeaways and showcase the final version of the e-course.

The Trial

The trial included 18 students from all over the world who agreed to complete the course within a given time-frame and provide feedback on each module as they progressed through the course. When the trial ended, we had gathered 108 feedback forms that gave us key insight into the following areas: (more…)

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