When Should Extension of Time Claims be Submitted?
We were recently appointed by a contractor to prepare an extension of time claim. The contractor exceeded the completion date 3 months ago and although there are many employer-caused delays, he has not so far submitted any claims for extensions of time. Unfortunately, this approach by contractors is all too typical and although it often results in work for consultants such as ourselves, it is disadvantageous to the contractor in many ways.
We now have to deal with a claim for 17 employer-caused delay events, which will be a very time consuming and complicated process. Until such time that we prepare the claim and the engineer has reviewed it, delay penalties will continue to be deducted from the contractor.
From both a preparation and a review point of view, 17 separate small claims are easier and quicker to review than one large claim for 17 delay events. It would have been much better to submit the claims as and when each delay occurred.
For the same reason, to complete such a large task with existing resources may not be possible, so additional cost may have to be expended to bring in a consultant to carry out the work.
The engineer, when presented with a claim for 17 delay events will undoubtedly need a significant time to review the claim and issue a response or determination, adding more time to the finalisation.
If one or two of the heads of claim are not agreed by the engineer, then any entitlement forthcoming for the others will be held up until the contentious issues are resolved.
Some of the delay events happened 10 months ago. Over time, memory grows hazy and although records should be available to substantiate the facts, claims are best dealt with contemporaneously when memories are clearer.
Had the contractor dealt with the claim early in the contract period, the engineer would have been sent a message that the contractor is prepared to pursue his entitlement under the contract, which may have encouraged a more reasonable determination than may otherwise be made.
The wait-and-see philosophy of leaving claims until the end of the project almost never works, because at the end of the project, the engineer and employer will have a completed project and there is little incentive for them to resolve matters in the contractor’s favour. Additionally, it is more than possible that when the project has been completed, the person or persons responsible for claims from the engineer’s side may have been moved to a new project and be less than enthusiastic about dealing with old issues.
The lesson here is to submit separate claims for each event as soon as possible after the event occurs.
Subscribe to receive expert commentary on contracts and claims
If you have enjoyed this article and found it interesting, subscribe to our mailing list to receive more great technical articles, plus relevant industry news for the aspiring construction claims professional.