sample loss and expense claim

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[put project title here] Contractor’s Loss and Expense Claims 1.1 Introduction. [Put brief introduction of the project and the circumstances leading to the claim. Remember to quote the authorising contract clause] 1.2 Heads of Claim. The following have been established through time, precedent or case law to be legitimate heads of claim. A. On-Site Establishment Costs These are cost associated with keeping the site operational during the extended period caused by delay and disruption of contractors regular. They are easily ascertained and generally relate to preliminary items such as supervision, plant and equipment, accommodation, etc. directly engaged upon the site. B. Head Office Overheads Head office overhead cost is often expressed as a percentage of a Contractor’s turnover and forms part of the rates inserted in the Contract Bills. During period of delay, there is reduced volume of work compared to planed activities. Losses thereby results due to the shortfall in income generated from the site for contribution towards the cost of head office overheads. Delays in completion of a contract may also mean that the contractor does not have the opportunity of being employed on another contract that would have contributed to the overheads. C. Loss of Profit 1

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Page 1: Sample Loss and Expense Claim

[put project title here]Contractor’s Loss and Expense Claims

1.1 Introduction.

[Put brief introduction of the project and the circumstances leading to the claim. Remember to

quote the authorising contract clause]

1.2 Heads of Claim.

The following have been established through time, precedent or case law to be legitimate heads of

claim.

A. On-Site Establishment Costs

These are cost associated with keeping the site operational during the extended period caused

by delay and disruption of contractors regular. They are easily ascertained and generally relate

to preliminary items such as supervision, plant and equipment, accommodation, etc. directly

engaged upon the site.

B. Head Office Overheads

Head office overhead cost is often expressed as a percentage of a Contractor’s turnover and

forms part of the rates inserted in the Contract Bills. During period of delay, there is reduced

volume of work compared to planed activities. Losses thereby results due to the shortfall in

income generated from the site for contribution towards the cost of head office overheads.

Delays in completion of a contract may also mean that the contractor does not have the

opportunity of being employed on another contract that would have contributed to the

overheads.

C. Loss of Profit

Loss of profit for delay or disruption is an allowable head of claim and this was established as far

back as 1854 in the case of Hadley v Baxendale [9 Exch. 341, 156 Eng. Rep. 145 (1854)].

D. Inefficient or increased use of Labour and Plant

Delay and disruption can lead to the loss of productivity or inefficient use of labour and plant.

This is also an established head of claim and relates to disturbance of the contractor's regular

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Page 2: Sample Loss and Expense Claim

and economic progress as in Croudace Construction Ltd v Cawoods Concrete Products Ltd

[(1978) 8 BLR 20]

E. Increased Costs due to Inflation

Delay caused by the Employer results in increased costs to the contractor due to inflation.

Additional expenditure on labour and materials due to these increases is an allowable head of

claim as in Croudace Construction Ltd v Cawoods Concrete Products Ltd [(1978) 8 BLR 20]. the

contractor may claim these costs15 by reference to published inflation indices. and can be ..

F. Finance Charges and Interest

It is now settled under the JCT Contract that finance charges by way of interest expended are

allowable heads of claims as is the loss of interest that might have been earned from money

diverted from investment; compensation for the loss of use money. This principle was

established in the case of F.G. Minter Ltd. v Welsh Tech. Services Authority [(1980) 13 BLR 1].

2.0 Statement of Claim

[provide here the statement of claim on each head you wish to make claim for showing your calculations clearly and making reference to supporting documents]

3.0 Summary and conclusion

[Conclude here and show total claim]

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