A Claims Class e-course student recently asked me when to use consolidated claims. This is something that I see contractors frequently get wrong, so I thought it would be a good subject for this month’s blog.

Should I submit a claim for each delay event or a consolidated claim for several delays?

A typical scenario is:

A contractually inept contractor gets to the last few months of the project and realises that they will not complete on time. Consequently they will be liable to delay damages and will incur overrun costs. The contractor then concludes that they need an extension of time to protect them against such risks.

This thinking is incorrect for two reasons. Firstly, most contracts provide that you should submit claims within a stipulated time of the occurrence of the event. This way, they may be dealt with as the project progresses. If you leave a claim until the end of the project, this will more than likely be a breach of contract and may even affect entitlement.

Secondly, good contracts management dictates that the time to submit a claim is when the contractor becomes entitled to make a claim. This differs from when the contractor needs more time or money. Again, this ensures that claims are dealt with as the project progresses and when matters are fresh in people’s minds.

If the contractor leaves extension of time claims until the end of the project, it is likely that several delay events will have occurred. The contractor usually then compounds their poor contract management by submitting one claim that includes all the delay events – a consolidated claim. Again, this is a poor strategy and is why, we always recommend that contractors submit separate claims for each delay event.

Our mantra is one event, one claim.

This has several advantages:

• Several small claims are easier to deal with for all parties than one large, complicated claim.
• It’s easier to prepare several small claims than one large, complicated claim.
• It’s easier to respond to several small claims than one large, complicated claim.
• It’s always better to submit claims within the contractual time frames than waiting for other events to have a knock-on effect.
• If one part of a large, complicated claim is questioned or not agreed to, this will hold up the award of the whole claim. This would not prevent other separate claims being resolved in a timely manner.

So, if you want your claims to be resolved and the time extended before it runs out, always remember this key point – the time to submit a claim is when you become entitled to make a claim, not when you need to make a claim.