July 19, 2018
1. If first notice of the claim is oral, confirm the contract requirement for written notice, and confirm that this date initiated the time period for the Contractor to provide its full and complete response. If first notice is written, draft and send a letter acknowledging receipt of notice and instructing the Contractor to meet all unmet contract requirements, including strict compliance with claim-notice provisions. Inform the Contractor that the Owner’s communications are in no way a waiver of compliance and that the Owner reserves all rights.
2. Calendar the date for the contractual deadline of Contractor’s submission of a complete written response. In most cases, deny any extensions of time for submission.
3. As the submission date approaches, review relevant contract provisions to incorporate into a draft letter responding to and rejecting the
Contractor’s claim. If needed, engage both the Owner’s representative and counsel to review and edit the Owner’s response letter.
4. If the Contractor in its formal claim submission fails to provide full and complete notice, draft a letter rejecting the claim for failure to timely and fully comply with all relevant contract and claim-notice provisions. Cite each that applies so the Contractor must respond on multiple fronts. Have the engineer or consultant produce an (oral) estimate for the proposed cost of the work. If the contractor’s proposed change is significantly higher, include that same (now) written estimate in the Owner’s response. To the future reader, the Contractor has not only failed to timely and fully comply with claim-notice provisions, but also the cost of the work now appears overstated and unreasonable.
5. Review the contract for other claim-related defenses, such as clauses where the risk of certain known or unknown subsurface or site conditions are allocated to the Contractor.
6. Review bid and contract addenda for sign-in sheets noting Contractor participation in opportunities to inspect site conditions and to review consultants’ testing, reports, and estimates of the cost of the work. Include in the Owner’s response any contractor failure to take advantage of information available that would have negated or reduced the Contractor’s basis for making a claim. If the claim is based on a subcontractor’s scope of work, but related to the Contractor’s failure to provide the sub with the same bid or contract information, include that as a basis to deny the claim.
7. If the Owner engages in negotiations on the cost of the claim or any increase in time, state that these communications are under Evidence Rule 408 and are not in any way a waiver of the Owner’s defenses or of the requirement for strict compliance with all related contract and claim provisions.