Construction Disputes: 3 Crucial Factors Determine Whether You Win or Lose
Where’s the evidence?
This week’s “Wise Up Wednesday” is about a recurring problem that catches Specialist Contractors out over and over again.
It’s all about the evidence!
Or to put it another way, and I quote from a learned source;
“Most cases are won or lost based on the strength or weakness of the parties’ evidence, so it is vital to ensure that as much relevant evidence (both documentary and witness) as possible is gathered at an early stage (ideally before proceedings are even issued).”
3 Crucial Factors Determine Whether You Win or Lose
There are three crucial factors that determine whether you win or lose and please, please, please bear these in mind even before you enter into the contract, and especially when you are doing the work. Because come the end of the job (and you’re not getting paid properly) it will be too late.
The three factors are;
- the evidence (facts),
- the relevant law when applied to those facts, and thirdly,
- the tactics of the case.
Whilst our Consultants are extremely good at the law and the tactics, the most important of the three is the evidence, as very few cases are won without strong evidence to support the winner’s arguments.
Getting the right evidence early is crucial, not only so you can properly assess the strength or weakness of your case, but also to try to persuade your opponent to negotiate an early and hopefully cost-effective settlement.
If you are not sure what evidence to collect or how to collect it, please give me a call on 01773 712116 and let’s talk it over.
The Good The Bad and The Ugly!
Evidence takes many forms and with good evidence a good Quantity Surveyor, Construction Contracts Consultant or Lawyer (all of whom are available via StreetwiseSubbie) will be able to substantiate your claims for variations, extensions of time, additional costs, and of course helping you get paid.
Without it you are at the mercy of the Client or Contractor who wants to allege all manner of wrong doing against you and make the resultant deductions from your account.
In the 26 years that I have spent representing Specialist Sub-Contractors in all sorts of contractual situations, I have come across the good, the bad and the ugly.
The good came from a mechanical services sub-contractor who had all of the following records in place:
- Weekly progress reports detailing exactly where his works had been delayed.
- Progress photographs cross-referenced to the progress reports.
- Labour allocation sheets detailing exactly where his men were working every day.
- Delay notices confirming the most significant delays and cross-referencing them to the progress reports and photographs.
- All of the contract documents recording in precise terms the agreement between the parties.
- Detailed variation submissions cross-referenced to marked-up drawings and instructions.
- Daywork sheets signed by the Contractor.
- Confirmation of verbal instruction forms confirming all the verbal instructions received from the Contractor.
- Copies of all the Contractor’s instructions.
- Detailed programmes showing the impact of delays.
- Detailed interim applications.
Needless to say, when the time came to prepare that particular Specialist Sub-Contractor’s claim for extensions of time and delay and disruption costs, all the information we needed was readily to hand. The net result was that the claim was very economical to prepare and resulted in a substantial settlement in the Specialist Sub-Contractor’s favour.
The bad came from a steelwork sub-contractor who had undertaken a multi-million pound project for a very well-known petro-chemical company. The work undertaken was first class and in all but the contractual aspects of the project, the Specialist Sub-Contractor had performed impeccably.
No proper systems were put in place initially and contractually the project was a bit of a shambles. The Specialist Contractor had even been persuaded to stop issuing notices, very much against our advice!
Several months passed and the Specialist Sub-Contractor completed his works in spite of all the problems he had encountered. By this time his costs were a cool £500,000 more than he had recovered!
The blue chip multi-national petro-chemical giant’s response to this claim?
They told him that he had not kept proper records as required by the contract. In particular, they said that his claim failed because he had not issued the delay notices required by the contract!!!
Trust me, ugly is an under-statement! The only proper records this particular ground-works contractor had were photographs! Literally hundreds of them.
His claim was that he was entitled to be paid circa £1,000,000 for labour plant and materials. At the point in time, he consulted me he had finished the work and had been paid only £500,000.
It is fair to say that he had been turned over good style by the main contractor, but he had certainly made a massive contribution to his own downfall.
Apart from the supplier’s invoices, he had no proper records of anything. He had no proper wage records and could never explain how he had employed his labour. He had submitted monthly applications which were completely unsupported by any back-up information. His daywork sheets simply referred to “Ground-worker(s)” instead of named individuals. He had no measures of the work he had undertaken and no marked up drawings.
Not surprisingly, the cost of unscrambling this situation was considerable and although our considerable efforts on his behalf secured a further £250,000, this was well short of a profitable outcome!
Need More Information?
We have lots of resources at your disposal from the free information on our web site, to our specially written guides for Specialist Contractors, to our exclusiveLinkedIn Group of 2,192 Specialist Contractors, right through to our best sellingGold Buddy Membership.
(Speaking of which, I’d just like to remind our Gold Buddies to use their free consultancy time to help you resolve any of your problems. We love helping!)
Do not suffer alone. Come and find out how we are helping Specialist Contractors of all sizes, in all trades, right across the UK.
I hope you enjoyed my Wise Up Wednesday email and that it gave you some food for thought, and I sincerely hope to speak with you soon.
In the meantime if you need any help with any of your business issues, please don’t hesitate to pick up the phone and give us a call on 01773 712116.