2 Claims That Increase Contractor Risk
Claims are commonplace in the construction industry. The more complex the project, the more likely contractors and owners will encounter claims. There are two claims that leave many contractors stuck with the risks that oftentimes could be avoided in the early stages of project planning. This article provides an overview of delay and disruption claims and what it takes to be successful in proving them.
Delay claims occur due to unexpected circumstances which extend the completion of a project. These claims are complex and frequently happen due to inclement weather, defective issues, approvals, differing site conditions, changes in work, and so on. Although delay claims are very common in the construction industry, these unanticipated extensions can get very expensive and cause disputes if not handled properly. Aside from direct additional costs, other disputed costs may include preliminaries, site and office overheads, and profit loss.
To be successful with a delay claim, you’ll need to prove the cause of the delay, the costs incurred as a result of the delay, and the delay’s impact on the critical path of the project. If you’re a contractor facing a delay discrepancy due to an owner or developer’s inactivity, a St. Petersburg construction attorney can assist you with getting a time extension or the compensation you deserve for the money you’ve lost as a result of the delay.
Project disruptions are the result of unforeseen events disrupting the critical path of a project thereby causing a decrease in output. Disruption claims may seem similar to delay claims, but they aren’t evaluated based on contract terms and are essentially related to productivity. These claims are challenging to prove because they are usually detected after the fact and the causes and effects of the disruption usually overlap with other issues.
Contractors are tasked with proving work was interrupted and that interruption caused delays. Further, the contractor must provide evidence of what elements of work was disrupted, which trades experienced disruption, and what losses occurred.
When unanticipated events impede project progress, you must ensure your documentation and records are in order. Depending on the extent of your disruption, filing a claim may require the expertise of a St. Petersburg construction attorney. The key to winning a claim is to be sure you have an established documenting and record-keeping process and that you keep consistent and accurate records throughout the entire operation. Failing to do so will make it difficult to backtrack if a claim arises.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.