sample loss and expense claim
TRANSCRIPT
[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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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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