Recommendation and report

Where it is apparent that monies are due, some payment should be made even if the total has not been fully calculated. Likewise, if it is apparent that some time is due to the contractor, an interim extension of time should be made, prior to a full calculation being carried out. In any event, an early response, without prejudice, should be issued to the contractor, setting out any prima facie errors and noting any additional information required.

It is important that every effort is made to pay such losses or costs, or grant such extensions of time, as have been ascertained or determined, as soon as possible. This particularly applies to large claims with high interest rates or fast programmes.

For loss and expense, having ascertained or determined the loss, the claim assessor should include an appropriate amount in the next valuation. The amount paid should be reviewed as and when significant new information is received, and when the claim assessor is satisfied that further payments are justified.

For extensions of time, having assessed the delay, the claim assessor should recommend an appropriate extension to be granted. The amount of the extension should then be reviewed when significant new information is received.

The proper, timely and professional consideration of claims reduces the risk of a major dispute arising.

For loss and expense, values should be reduced in subsequent valuations where they are shown to have been previously assessed at too high a level. Any delays in reducing amounts included in valuations will only exacerbate the problem. However, valuation reductions are always difficult and should be avoided wherever possible. The contractor has a legitimate interest in the stability of amounts included in the interim valuations, as it will probably use figures in the valuations as a basis for payment of subcontractors and suppliers.

Where a contractor is late in supplying information, appropriate deductions from finance charges should be made.

With regard to extensions of time, many standard forms of contract do not allow the contract administrator to review the entitlement to an extension of time downwards. Extensions should therefore not be granted, for example, on the promise of further evidential information being provided.

Forensic planning

A large number of construction and engineering disputes come about because of unforeseen changes or post-commencement variations to a project. Such changes almost always result in delay and disruption to a project, in particular to the programme and, consequently, the completion date.

Forensic planning is used by parties to a dispute to assess the potential entitlement to damages, costs and extensions of time. This is achieved through the carrying out of an independent review of planned versus actual progress of a project and the analysis and quantification of delay and disruption. All of this takes place within the context of the provisions of the construction contract.