A recent article in the Construction Executive discussed the importance of preserving your claim, both in terms of timeliness of submitting your claim and making sure that you aren’t waiving portions of your claim when executing releases. These are all excellent points and bear some follow-up.
Timing Your Claim
I often review construction contracts that contain deadlines by which claims must be submitted. It may seem counter intuitive to think that you need to submit a claim when you are discussing the basis for the claim with an upstream contractor or the owner. But, there are more cases than I care to count where a contractor’s claim has been denied because the claim was not timely submitted.
Tool Box Tip: A good practice is to summarize the claim deadlines on a contract checklist so that you have the deadlines easily at hand when you are considering a claim.
Preserving Your Claim
When it comes to resolving disputes on a project, contractors are often asked to sign contract modifications or releases. While the purpose for the modification or release may be narrow, the release or modification may contain broad waivers of rights. As noted in the CE article, even governmental entities are not above using broad waivers, leaving it to the contractor to find the broad language and limit it. Contractors may also be asked to waive lien rights when receiving a partial payment that are much broader than the payment being made.
Tool Box Tip: Make sure that when you are being asked to waive rights, you read all the fine print and speak up if you notice that the rights being waived are broader than those sought to be resolved.