What Causes Claims on Construction Projects?
We thought it might be good to review some issues that could result in claims on construction projects. Knowing what indicators to look for will help contractors spot problem areas that could develop into claims if not addressed and dealt with promptly.
As discussed in other posts, good record-keeping is key to proving a claim. So, when these issues come up, a contractor needs to be very diligent in recording this information in its daily logs and project documents.
There are many common trends that we see that cause claims on projects. The following list sets out the causes that we see most often result in disputed claims:
- Extra work caused by changes in the scope or complexity of the work. For instance, a differing site conditions claim comes up when the scope or complexity of the work has been increased due to a meaningful difference in the way the site was described in the contract documents versus reality. “How were we supposed to know that there were rocks in the subsurface in Southwest Virginia?”
- Unplanned disruptions, suspensions, or stop work orders.
- Contract acceleration. “When you said to be done by Christmas, I thought you meant next Christmas.”
- Labor, material or equipment problems or shortages. “We’re out of glue.”
- Architect-related delays – errors and omissions in drawings and specifications leading to RFI’s and design confusion, as well as delays in contract administration. “Don’t blame me.”
- Weather delays – “It’s beginning to look a lot like Christmas”
- Site congestion, limited site access, or a lack of coordination among various subcontractors and a lack of coordination by the general contractor. “Who’s on first?”
If these issues come up on your project, then a claim is likely to follow whether you have a claim or expect to receive one.