Beware the pitfalls of political reporting! You’ll regret it!
All construction contracts impose obligations on contractors to report on the progress of the work to its client. All too often, especially on major international projects, we encounter what I term as political reporting.
Let’s be clear about what I mean by “political reporting”. In simple terms, construction contracts impose obligations on contractors to accurately report progress achieved against the baseline or planned position, and any delays identified. If delay has been suffered, then mitigation measures should be ascertained and put forward to the owner, so that delays can be recovered and the owner can make an informed decision accordingly.
In our experience, all too often this does not happen!
On numerous disputes that we have been involved in, contractors particularly on major international projects, all too often only report delays when it becomes blatantly obvious that they are not going to complete on time. Typically, this will be some months after the actual delay was experienced, as there is always a belief that “we can still finish on time”.
Rather bizarrely, we encounter this on projects where the delays are not even the contractors fault!
I know that nobody wants to be the bearer of bad news and get shot. But come on guys, by reporting delays you are only operating the contract i.e. you are doing what the contract requires you to do. From my experience, clients become more upset when they are denied the opportunity to attempt to mitigate the problem away and not have to deal with its consequences some months later.
Contractors, by taking this approach run the risk of being time barred for their claims and having severe difficulties evidencing their delay claims. It’s not easy demonstrating delay when the contemporaneous records show you being on time!