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Cause and effect proven? My claim got kicked out, why!!

If you have not proven cause and effect, then your claim may well fail!

Sometimes we are asked by clients, why was our claim unsuccessful? There are potentially many reasons for this, but from our experience, the most common and significant reasons that occur time and time again, can easily be identified.

I consider there to be four major causes:

Number 1: effects not proven, you have failed to prove cause and effect

Clauses in contracts allow for contractors to claim for the impact of client ‘events’, which can include “acts of prevention or impediments”, breaches of contract by the client, or variations to the work.

If a contractor alleges that the client has caused a delay then this must be clearly demonstrated, typically by detailing or explaining how the event caused the delay i.e. demonstrate cause and effect. What is trickier is proving the effect of this client-caused event on the contractor’s schedule of work.

Contractors may have hundreds of activities going on at the same time, and identifying the single event that is causing a delay to a milestone or a completion date requires factual delay analysis.

Delay analysis has become something of a cottage industry, with a multitude of textbooks, articles and academic opinion available on delay analysis methodologies. Some of these approaches focus too heavily on “entitlement” and the “theoretical effects” of delays, and in claim negotiations such strategies are rarely successful.

We recently handled a claim in which a contractor whose approach greatly exaggerated the delay actually caused by our client, and failed to take the contractor’s own delays into account. This resulted in protracted negotiations and the contractor ultimately having to go back to square one to properly demonstrate entitlement.

The most effective approach is a pragmatic one that focuses on demonstrating what actually happened, based on contemporaneous records.

Look out for number 2.

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Kenzie Claims Assistant