Contract claims procedure

[edit] Introduction

The process for making claims under a construction contract typically involves several key steps to ensure they are made in accordance with the contract terms and that they are properly documented and substantiated. This article presents an outline of common procedures, but ultimately the process required will depend on the exact wording of the contract and the application of relevant legislation such as the Housing Grants, Construction and Regeneration Act.

[edit] Identify the basis for the claim

Claims can arise from a number of situations, such as:

• Variations or changes to the work scope.
• Delays and disruptions.
• Unforeseen site conditions.
• Non-payment or late payment.
• Breach of contract terms.

For more information see: Contract claims.

[edit] Review the contract

Carefully review the construction contract to understand:

• The types of claims that can be made.
• The notice requirements.
• The time frames for submitting claims.
• The specific procedures for making a claim.
• The documentation required.

[edit] Notification

Most contracts require prompt notice of a claim. This notice should include:

• The nature of the claim.
• The reasons for the claim.
• The potential impact on the project.

[edit] Document the claim

This may include:

• Detailed records of the work performed.
• Correspondence (emails, letters).
• Site diaries and logs.
• Photographs and videos.
• Statements from witnesses.
• Schedules and programs.

[edit] Prepare the claim submission

Prepare a formal claim document, which typically includes:

• An introduction and summary of the claim.
• A detailed description of the events leading to the claim.
• The contractual basis for the claim (citing relevant contract clauses).
• Supporting documentation and evidence.
• Calculations of the claim value (e.g., costs incurred, delay impacts).

[edit] Submit the claim

Submit the claim to the other party (e.g., the employer, main contractor) in accordance with the contract’s procedures. Ensure that the submission is timely and includes all necessary documentation.

After submitting the claim, there may be a period of negotiation and discussion. The goal is to reach an agreement on the validity and value of the claim. This may involve:

• Meetings and discussions between the parties.
• Clarification and provision of additional information if requested.
• Adjustments to the claim based on feedback.

If the claim is not resolved through negotiation, the contract will typically provide for dispute resolution mechanisms, which may include mediation, adjudication (a statutory process under the Housing Grants, Construction and Regeneration Act 1996), arbitration or litigation.

[edit] Related articles on Designing Buildings

• Adjudication.
• Alternative dispute resolution.
• Arbitration.
• Contract claims.
• Construction contract.
• Dispute avoidance.
• Dispute resolution.
• Disruption claims in construction.
• Evaluation of claims.
• Housing Grants, Construction and Regeneration Act.
• How to prepare a claim for an extension of time.
• Mediation.
• Scheme for Construction Contracts.