Loss and Expense

Legal and Contractual Solutions

Loss and Expense

Solutions on loss and expense: head office overheads and the formulae, finance charges, profit, acceleration and consultant claims.

Extension of time and loss and expensePremiumNo. An extension of time and financial compensation are separate entitlements unless the contract expressly combines them. The contractor must establish the contractual basis and...

Recovering contractor's claim payments from consultantsPremiumPotentially, but not automatically. The employer must establish the consultant's breach of its appointment, a causal link to the contractor's liability and the reasonableness of the sum...

Contemporaneous records and additional payment claimsPremiumYes. Poor records may reduce the recoverable amount or defeat the claim entirely, particularly where the contract makes contemporaneous verification a limit or condition of entitlement.

Defective claims notices and particularsPremiumYes, where the contract clearly makes compliant notice or particulars a prerequisite or otherwise states the consequence of non-compliance. The wording, purpose and scope of the...

Early completion programmes and late informationPremiumNot merely because the contractor programmed an earlier finish. Recovery requires a contractual duty or breach causing compensable disruption or cost; the employer does not ordinarily...

Accepted programmes and information releasePremiumNot necessarily. Programme approval does not, without supporting wording, replace the contract's information-release obligations. The executed contract determines when information is due...

Recovering claim-preparation costsPremiumOrdinarily, the cost of performing the contract's claims procedure is not separately recoverable. Additional preparation cost may be recoverable where it is caused by a separate breach, or...

Head-office overhead claims and formulaePremiumA formula may assist valuation after entitlement, causation and actual loss are established. It cannot prove that a compensable delay caused unabsorbed overhead, lost opportunity or...

Valuing extended preliminariesPremiumThe starting point is the contractual valuation rule. Where entitlement concerns direct loss, expense or cost incurred, recovery should ordinarily reflect reasonable additional expenditure...

Prolongation period and resource scopePremiumValue the reasonable additional cost when and where the compensable event affected the works. The extension or overrun period is not automatically the correct cost window, and critical...

Finance charges in contractor claimsFreeFinance charges may be recoverable where the contract permits them or as damages for proven financing loss caused by delayed payment. The claimant must establish entitlement, actual loss...

Profit in contractor monetary claimsPremiumProfit is recoverable only where the contract or damages rules provide for it and the contractor proves the relevant loss. Some cost definitions expressly exclude profit, while other...

Acceleration and constructive accelerationFreeAcceleration cost is recoverable where the contract or an agreement provides for it, or where proven employer's breach causes the contractor reasonably to incur acceleration expenditure....

Reasonable time for notices and informationFreeThere is no fixed universal period. Reasonableness is assessed objectively from the contract, the purpose of the obligation and all relevant circumstances at the time performance was...

Disruption evaluation and the measured mileFreeThe measured mile compares productivity on substantially similar unimpacted and impacted work. It can quantify lost productivity, but it does not establish contractual entitlement or prove...

Claims consultant's liability for incorrect advicePremiumYes. A consultant may be liable where the retainer imposes the relevant duty, the advice falls below the required professional standard and that breach causes recoverable client loss.

Employer delay and later adverse weatherPremiumPotentially. The contractor must prove that the employer-risk delay moved the affected work into the adverse-weather period and that the later time and cost were a recoverable consequence...

Unforeseen ground conditionsPremiumThe executed contract allocates the risk. Some forms place unforeseen physical-condition risk on the employer subject to defined thresholds and procedure; others place it on the contractor...

Mitigation of contractual lossPremiumThe injured party cannot recover loss that it could reasonably have avoided. Mitigation is a limitation on recoverable damages, not a separate duty owed to the party in breach.

Meaning of consequential lossFreeAn exclusion of consequential loss does not necessarily exclude every financial consequence of a breach. Its effect depends on the language used, read in the setting of the contract as a...

Pre-agreed delay loss and expense ratePremiumThe parties may agree a daily or weekly payment for loss and expense or additional cost arising from employer delay. The provision must define when the rate applies, what it covers and...