Following a speech from the 2014 Construction Law Conference on record keeping, Constructive takes a look at what is considered by many to be the single most important aspect to establishing a successful claim: the availability of adequate records. 

Documents are the buildings blocks from which arguments are presented.  Nevertheless, parties often fail to comply with the contractual requirements in respect of the provision of documents.  This can be damaging to the project.  It can lead to a loss of trust between the parties (a certifier is less likely to accept the position of a contractor where it has no faith in its record keeping), and ultimately to a claims culture. 

The parties to a contract are well advised to take note of what their contracts say about record keeping.  Under the FIDIC Red Book, there are obligations upon the contractor to provide detailed monthly reports with information on progress as well as the use of staff, labour and equipment, whereas the current JCT Standard Building Contract does not directly impose those kinds of obligations. Nevertheless, in the event of a claim for more time or money under the contract the same kind of information will be important, since the contractor is required to “supply such further information as the Architect/Contract Administrator may at any time reasonably require.”

In the event that a contractor seeks to establish entitlement under a contract, it will generally be required to demonstrate that:

  • the employer was contractually responsible for the event (liability);
  • it incurred some loss (damage);
  • the loss was caused by the event complained of (causation).  This is often the most difficult aspect to prove.

To establish a relationship between liability, loss and causation, a judge or adjudicator will normally need to see a mixture of witness evidence and expert analysis. However, factual and expert evidence which is not underpinned by contemporaneous evidence is unlikely to be persuasive to a tribunal.

Here are some of Constructive’s record keeping tips:

  • make sure systems and procedures are put in place to adequately record events and their effects on a contemporaneous basis;
  • invite the other party to agree correspondence and meeting minutes when they are issued (it will be more difficult for a party to dispute the veracity of a document that it has not objected to);
  • ensure that staff are aware of the contractual requirements in respect of record keeping and are adequately trained in the relevant systems;
  • audit the system – avoid the assumption “we are already doing this”;
  • employers should consider incorporating specific contractual requirements in respect of record keeping.

If it becomes necessary to establish a claim before a judge or adjudicator, the party who holds the best records will be in the best position.  It’s inconvenient, but in the long run, it pays to get your house in order.

Slides from the 2014 Construction Law Conference can be found here.