Progressing the claim

Notification under the contract

Most standard forms of contract require the contractor to submit to the representative of the other party notices of actual or anticipated delay as soon as the contractor becomes aware of any delay. Failure to provide such notices will not usually prevent the contractor from being granted an extension of time, unless clear words to that effect are used in the contract conditions. However, failure to provide such notices is a breach of contract that may entitle the other party to recover damages, for example, if the failure to provide such notices deprives the other party of an opportunity to mitigate the delay.

The surveyor should therefore check that proper notices have been given specifying the circumstances, as soon as it became apparent that progress of the works, in whole or part, would be or had been affected by the stated event.

Generally, there is not a contractually prescribed form for such a notice. A statement during a meeting that is subsequently minuted may suffice, but a notice in writing is usually required. Best practice would be to send separate written notification of delay even if the matter has been discussed at a meeting. The purpose of the notice is to inform the other party that the circumstances in question were or would be likely to cause the contractor to suffer delay for which it would be entitled to an extension of time under the terms of the contract.

Relevant cases (to be found in the Key cases section) with regard to notification under the contract are: City Inn Ltd v Shepherd Construction Ltd [2010] Scot CS CSIH 68 and [2003] BLR 468 and Multiplex Constructions (UK) Limited v Honeywell Control Systems Limited (No 2) [2007] EWHC 447 (TCC).

Initial response to the contractor

In the event of an apparently valid claim being submitted, it is for the claim assessor to carry out the following, as required by the contract concerned:

• identify the claimed circumstances as notified;
• determine the circumstances actually causing the events on site;
• evaluate the effects on resources, including determining whether the effects are too remote from the cause;
• ascertain or determine the financial evaluation; and
• report on the claim.

In ascertaining loss or expense, or the amount of delay, the claim assessor should seek to obtain as much evidential demonstration as possible that the loss or delay in question has in fact been suffered. Often, even following an analysis of all available information, there can be some doubt. In such cases, if the claim assessor is satisfied that they have all available information, and is satisfied that it is not the contractor's fault that any further information is not available, the assessor should proceed either to include the amount in the next interim valuation (for loss and expense), or grant an extension of time, if there is a higher chance than not that the loss or delay has in fact been incurred (see Ascon Contracting Ltd v Alfred McAlpine Construction Isle of Man Ltd [1999] 66 ConLR 119.

Design team action and records

The architect or engineer is responsible for administering a contract so as to permit the contractor effectively to execute the works.

Such post-contract action includes:

• programming the timely supply of information or variations in line with the contractor's applications;
• limiting variations to essential matters;
• giving early sound consideration to requests made by the contractor for additional information or monies;
• having a sound knowledge of progress and events on site; and
• providing a proper and full valuation of variations.

It is also the responsibility of the architect or engineer to instruct on and ensure the sound maintenance of project records of relevant issues and to chair site progress meetings. As soon as the architect or engineer becomes aware that the contractor may become entitled to reimbursement of loss or expense, or to an extension of time, they should review the records that are being kept in order to be sure that they will enable an accurate ascertainment of the loss or expense, or delay, to be made. If it becomes necessary to instruct the contractor to keep additional records, this instruction should be issued as soon as possible.

Requests for records, or to keep additional records, should be reasonable and relatively easy for the contractor to effect. Instructions for the contractor to collate and analyse information in a complex and time-consuming way could involve the client in additional liabilities.