To claim or no to claim?

Construction News - 08/04/2009

Upon completion of any construction project there will be discussion of unresolved issues while the project was underway.

It is at this point that contrasting views are often held by each party over what the final settlement figure ought to be. Often representatives from each side may have become fixed in their views, with feelings running high and a breakdown in the relationship that may be hard to recover from.

The dilemma is frequently not whether it is worth claiming, rather it may be ‘is there a claim to be pursued?’ Any entrenched positions held by the parties may prevent a clear and objective view of the issues.

It may be apparent that there is in fact no claim to pursue or the chances of success are minimal. If there is any sense that the claims arise primarily due to the intransigence of the parties’ representatives rather than a strong basis in contract or law, then this ought to be addressed before entering into any negotiations.

During negotiations, the issues that are proving difficult to resolve with the other party must be quickly highlighted. You must also seek to understand why they are proving difficult – is it a genuine and substantive disagreement over the issues and principles, or a clash of personalities?

To achieve resolution, those who have reached an impasse may in some instances have to be taken out of the negotiations and replaced with others from both parties and / or third party advisors. The contentious issues should then be assessed individually.

If all goes well a mutually acceptable negotiated settlement can often be achieved without reference to a formal tribunal. Unfortunately, even with best intentions a settlement cannot always be achieved. If the stalemate cannot be broken, adjudication may present an effective alternative.

Any subjectivity should be removed to ensure the decision to prosecute or defend is made for the right reasons. Third party advisors with no prior knowledge of the project may be beneficial.
Greg Brownlee is managing director of commercial management and dispute resolution consultancy Blake Newport.

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