Independent Claims Review
The Construction Industry is almost unique in the manner in which it does business. It knows what it will be paid upon completion of a project but has to estimate its costs prior to execution and submit tenders on the basis of those estimates. Conversely, most other industries know their costs and assess their future income.
Contractors rely heavily, sometimes almost universally on subcontractors and suppliers outside of their direct control thereby compounding the difficulties faced by them.
Contractors’ claims are often badly structured and lack adequate support and evidence of entitlement. Many are based wholly or partly on claims submitted by subcontractors that many contractors will seek to pass on to the ultimate client.
The construction process itself frequently suffers from unforeseen and unexpected events that the contractors have little or no control over. These include physical conditions on sites; material shortages, labour shortages, political issues and of course over the past year we have seen the devastating effect of COVID-19 on the industry; its subcontractors, suppliers, and of course the substantial human cost.
The history of the construction industry is littered with the names of companies ranging from the world’s largest to its smallest construction companies, who no longer exist. (Refer also to the article on our website published in Construction Law (Volume 31 No. 2 March 2020) titled “The importance of Being Earnest” that examples a UK company called Davy McKee. Other examples of major contractors that no longer exist include, Germany’s Philipp Holzman and the UK’s Carillion.
It is not uncommon for contractors to raise claims that are badly supported, lack adequate support and provide the minimum proof of the balance of probabilities.
It is also not uncommon for many consultants to reject claims out of hand and/or fail to investigate the factual data and refuse to certify payment even when there are claims with substantial merit.
As a consequence, the parties move further apart and arbitration and other forms of formal disputes commence, often leading to enormous cost incurred by employers and contractors alike that could have been avoided by a more professional and pragmatic approach by one or both parties.
Whether you are a lawyer acting on behalf of an Employer or Contractor; or a Contractor that has formulated or submitted a claim for more money, or time or both; or an Employer, in receipt of a claim, have you considered a professional independent review?
Such a review provides an independent professional assessment of the strengths or weaknesses of a contractor’s claim and a broad view of possible entitlement or liability, always subject to issues of law and the vagaries of arbitration.
Our professional team of construction professionals are highly experienced individuals with substantial track records working on live projects for contractors and employers, and in disputed matters ranging from relatively swift overviews and simple advice to providing expert independent expert testimony in major arbitrations.
That independent advice includes some stark examples noted below.
Example 1
One of our experts was asked by the Developer of a large multi-story office block in central London to examine its claim (already submitted to a court) against a trade contractor on a Construction Management project to refurbish the entire building including the external facade. The employer claimed that the lift contractor had held up completion to such an extent that it delayed the letting of the building from a period of high demand for office space to much reduced demand that resulted in substantial losses of rent.
One of our experts took on the role that he had pre-estimated might take about seven weeks. He returned to the client within two days with the advice to “get out of this as fast as you can because it is obvious that that trade contractor did not hold up completion.”
The client followed our expert’s advice and withdrew from its claim against the trade contractor.
Example 2
A number of our team members were engaged as experts to one of the major contractors on the Channel Tunnel. Following an initial review of the facts, the contract and the details, our expert consulted instructing solicitors about a “non-legal” opinion that he had established after his initial review. The contract contained a bonus clause for early completion and delivery of elements of its work. The Expert asked the legal team if he could establish that the client was entitled to extend its delivery period because of excusable delays, would that change the bonus dates for early delivery?
The legal team agreed that it would. The consequences were to introduce into the claimed values amounts of several tens of millions of pounds to the client’s case. It was settled by negotiation.
As a team we have written articles often published in Law Journals. Those articles were and are based on the collective experience of our experts’ who have all been involved in live construction projects; construction disputes; dispute resolution and independent expert witness roles.
Our experts have proven experience working on live projects and expert knowledge of the dispute processes. We provide our consultancy services based on our individual and collective understanding and knowledge of construction and the dispute processes.
One of the many services that we have always provided to our clients is an independent review.
If you require any assistance with any issue relating to claims promulgated or received, or acting on behalf of an employer or contractor, we provide an initial one-hour consultation by telephone or video meeting free of charge.
We will discuss your issues, advise as far as we able as to the way to proceed and offer support to address any claims to be presented or received.
Should it be considered that further investigation is necessary we will discuss with you the procedure and basis upon which any such work is undertaken.
If this service is of any interest to you, please do not hesitate to contact us in the first instance by email info@iainwishart.com or via our website www.iainwishart.com/contact/.
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