PRESENTING CLAIMS

27 FEB 2013
Project Description
The project is the construction of a small building which is to house switchgear. The building comprises a steel
structure which supports the external walls and the roof. There is an Access Gantry constructed just outside the
building. The switchgear is installed within the building.The Main Contractors programme has 4 activities. The
erection of the Steel Frame, which is to be carried out by Sub-Contractor A. The Walls and Roof are constructed
by the Main Contractor. The switchgear inside the building is to be manufactured and installed by Sub-Contractor
B. Finally, the Access Gantry is to be erected by the Main Contractor, who intends to use a 200T crane to perform
the operation.
The work is expected to take 9 months, but the contract completion date is at the end of month 10 i.e. there is a
one month float in the programme. The actual project takes longer to construct than planned. In fact, there is a 3
months overrun, to month 13, although the total delay is 4 months, given that the programme float is used up as
well.The causes of delay are as follows:-
(a) The steel frame is two months late due to slow progress by Sub-ContractorA.
(b) Sub-Contractor B advises that the switchgear will be 4 months late beingdelivered.
(c) A design fault is discovered which will prevent the commencement of the Access Gantry work by 2 months,
There is a 4 month delay by the Main Contractor delivering his crane which is required to erect the Access Gantry.
2 MAKING A CLAIM FOR EXTENSION OF TIME CLAIM
2.1 There are various claims that could be made by the Main Contractor. For example,he could claim against Sub-
Contractor A or Sub-Contractor B resulting from theirdelays. However, I want to concentrate on the delay caused
by the design fault -Delay 3.
2.2 If we adopt the as-planned impacted method of analysis, we identify that the design fault affects Activity 4.
The design fault prevents Activity 4 starting for 2 months. Consequently, the impact is to push the completion
date out to month 11, which would mean a 1 month extension of time.
2.3 However, if we leave it at this, the Employer benefits from the Main Contractors float i.e. month 10.
Consequently, the Main Contractor would want to claim the benefit of the programme float. (If the project had
been actually completed in month 11, then there would be no need to claim this extra month - since we only claim
an extension of time for the actual period of project delay).
2.4 In summary, we now want to make a claim on behalf of the Main Contractor for a 2 month extension of time
due to Delay 3 - the Employers design fault.
2.5 6 steps for making an extension of time claim.
Step 1 - The Contract
2.6 We need to review the contract we are operating under and look for the following
type of clauses:-
(a) The obligation to complete by a given date. Usually, the clause will say that the Contractor must complete the
Works by a date set out in an Appendix to the Contract. In this case, the Appendix will say the completion date is
the last day of month 10.
(b) There will be a liquidated damages clause which will explain that if the Contractor does not complete the work
by the completion date, the Employer will be entitled to receive payment of a sum of money, usually expressed as
a sum of money per day.
PRESENTING CLAIMS
27 FEB 2013
(c) In order to maintain the validity of the liquidated damages clause when there are certain types of delay, there
will be an extension of time clause.
(d) This clause will identify excusable events, which are those events which, if they arise, will excuse the
Contractor of any delay caused by the event. In this case, we have to show that the event we are claiming - the
design fault - fits in with one of the excusable events in the contract.
(e) All contracts require the Contractor to give written notice of the delay; some contracts require written notice
within a given period of time - say 14 days from the date of the event. Contractors need to be very aware of these
clauses because sometimes you loose the right to make a claim if no notice
is given.
(f) Finally, a contract clause will require the Contractor to provide particulars of the event and its consequences.
STEP 2 - RECORDS
2.7 The provision of particulars of the claim brings us on to the second step, which is the need to maintain records.
These include progress records, labour records, photographs, cost records, drawing schedules etc. It is really
important to keep records.
STEP 3 - THE FACTS
2.8 Based on the project records, the Contractor should provide a detailed statement of the facts of the case. In
this case, the statement will explain how the Access Gantry was designed in the Contract, what the programme
was for erecting it, when the design fault was discovered and what it was and what had to be changed. Also, it will
set out when the new design was received from the Employer and so when the Access Gantry work was able to
start.
STEP 4 - THE TIME ANALYSIS
2.9 Having explained the facts of the event, i.e. the CAUSE of the delay, it is necessary to demonstrate its EFFECT.
In this case, we would submit a programming analysis which shows which activities were affected and how the
event delayed the overall project completion.
STEP 5 - THE SCOTT SCHEDULE
2.10 A very popular way in which the details of the claim are summarised, is by constructing a Scott Schedule. In
most claims, there will be many events which the Contractor will be relying upon and so the schedule is quite long.
In our case study, there is only one event, which is obviously artificial. Anyway, the Scott Schedule should set out
the following information in relation to each event:-
description of the event, factual details relating to the history and nature of the event, clause giving the right to
extension of time, details of the notice given,relevant documents to evidence the event and its related facts,
programme activities affected, period delay claimed i.e. the delay to completion caused by the event
STEP 6 - THE STATEMENT OF CLAIM
2.11 Finally, the Contractors claim should include a clear statement which confirms that:- in accordance with a
particular contract clause
an extension of time is requested,arising out of a particular event relevant to the extension of time clause, that
the event was notified in good time and setting out, a statement of how long the extension of time requested is.