ConstructionPro Week, Volume: Construction Advisor Today - Issue: 111 - 06/10/2011

Public Project Owner Delay on Claim Decisions

Public construction contracts at every level of government call for the initial submission of a claim to the public project owner itself for an administrative determination of the merits of the claim. This is a prerequisite to litigation of the claim in another forum. Sometimes the contract stipulates a period within which the owner must make a decision on the claim; sometimes not. Even when a deadline is stated, the owner can invoke exceptions. Basically, a standard of reasonableness prevails.

 

On a recent federal construction project, the agency was allowed almost a year to render a decision on a claim. Admittedly, the claim was large and complex. The agency needed to hire a claim consultant to analyze the claim. And the contractor’s lack of diligence hurt its own cause. Nonetheless, a year is a long time to wait for a decision which is merely a prerequisite to the actual prosecution of the claim.

 

What has your experience been on public construction contracts? Do project owners delay issuing claim decisions in order to discourage contractors and defer payment of funds rightfully owed? From the standpoint of a public project owner or representative, do you feel contractors create their own problems by submitting poorly formulated claims which lack supporting documentation? I welcome your comments.

 

Featured in Next Week’s Construction Claims Advisor:

 

  • Commercial Impracticability Did Not Mandate Change Order
  • Delivery Tickets Did Not Support Supplier’s Lien
  • No Evaluation Advantage for Environmentally Preferable Building Products

 

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