Claim Management

Successfully navigate through turbulent times

Challenges in the global economy because of inflation, materials shortages, material price escalation, supply chain disruptions, labor shortages, and a regional wars have undoubtedly caused increased cost and schedule pressures on owners, contractors and the supply chain, which will lead parties to consider the possible options for claims for additional recovery.

To respond to this challenge, the parties’ effort at the early stages of projects has become more important than ever. In this respect, appropriate preparation of contract documents, suitable project schedules and risk management at the start of projects has been identified as the most effective method for preventing claims. But even with effective planning, disputes over cost inflation may be inevitable, and emphasis should be placed on early dispute resolution.

Resolution of construction disputes can be very costly, so seeking to resolve them earlier, mitigate them during construction, or prevent them altogether is preferable strategy

Claims Avoidance

The most effective claims avoidance technique is contract and specification reviews, followed closely by risk management and constructability reviews. Careful advanced planning and risk management are some of the potential ways to avoid disputes and subsequent claims. Risk management, when done properly, provides a significant impact while at a relatively low cost.

Claims Mitigation

The risks that drive the need to mitigate are generally realized risks so the projects are already in a state of delay and since time is an expiring resource, the most that can be done is to regain time later in the project to offset the already lost time. Risk management is often focused on negative risks or threats, whereas claims mitigation is much more heavily focused on positive risks, or opportunities, to reduce delay quantum and consequence. Implementing positive risk management to identify and exploit opportunities is a continuous performance improvement process that yields great returns on investment. Parties’ willingness to compromise, as well as accurate and timely schedules and reviews by project staff, were the most important factors in being able to mitigate disputes or achieve early resolution.

Claims Resolution

Settlement prior to proceedings is the most common dispute resolution technique, especially reached through early party-to-party negotiations, followed by arbitration as a preferred forum for formal proceedings. Parties favor negotiation over mechanisms such as arbitration and litigation due to time and cost as well as the desire to maintain good relationships for continued work. When it comes to finding resolutions, recognition of the need for compromise, coupled with disputes avoidance techniques have proven to make a big difference in delivering successful projects while minimizing disputes.

Owners and contractors who address these new impacts earlier in the project will have a greater likelihood of success.

Claims Services

Depending on our client’s current and future project needs, we can analyze problems and disputes, establish cause-effect relationships, and determine responsibilities for problems and their impacts.

Our personnel are experienced construction management professionals who have experience on numerous EPC projects to analyze issues related to Schedule Delay Claims, Cost Based Claims or Loss of Labor Productivity Claims.

Our tasks depend on work a client has already performed, availability of project documentation, issues in dispute, and available time for preparation of required work products.

Our claims resolution methodology incorporates a systematic process involving problem identification, document analysis, contract analysis, entitlement analysis, establishment of cause-effect relationships, and damages analysis and calculations.

  • Problem identification that cause project cost, quality, and schedule issues
  • Entitlement establishment through contract language, case law, or good industry practice for recovery of damages
  • Forensic schedule delay analysis for the resolution of delay and impact-related construction disputes
  • Cost/damage matrix for the allocation of responsibility for man-hour and cost variances between control budgets and actual man-hours and costs
  • Cause-Effect relationships among problems, schedule impacts, productivity losses, and cost overruns

Experience gained on numerous projects has taught us how to provide claims prevention services that save clients from costly consequences. Essential elements of our claims prevention include:

  • Understanding contracts
  • Analyzing risks before signing contracts
  • Knowing the basic claim entitlements and avoiding them
  • Reviewing and approving as-planned schedules
  • Understanding schedule administration
  • Implementing timely contract administration
  • Integrating cost and schedule control
  • Adhering to the contractual change management system
  • Documenting cause and effect of delays and increased costs
  • Implementing an effective dispute resolution process