Construction claims can significantly impact your project’s timeline and budget. While not all claims are preventable, many can be avoided through proper planning and management. Here’s what every project owner/contractor should know about preventing construction claims before they arise.
Recognizing Warning Signs
The best defense against construction claims is early recognition. Watch for these key indicators that may signal potential claims:
- Repeated requests for information about the same issues
- Increasing frequency of change order requests
- Schedule delays without clear explanation
- Sudden changes in site personnel or subcontractors
- Documentation gaps in daily reports
- Verbal disputes over contract interpretation
- Rising tension in project meetings
When these signs appear, take immediate action to address underlying issues before they escalate into formal claims.
Essential Documentation Practices
Strong documentation is your best protection against potential claims. Implement these proven practices:
Create detailed daily reports that include weather conditions, work performed, equipment on site, and any delays or disruptions. These reports should be consistent and factual, avoiding subjective comments.
Maintain organized project files with:
- All contract documents and amendments
- Submittals and approvals
- Meeting minutes and attendance records
- Progress photos dated and labeled
- Correspondence between all parties
- Change orders and supporting documentation
Remember: if it’s not documented, it didn’t happen. Make documentation a daily priority, not an afterthought.
Effective Communication Protocols
Clear communication prevents misunderstandings that often lead to claims. Establish these protocols from day one:
Create a clear chain of command for project communications. Define who has authority to make decisions and how information should flow between parties.
Schedule regular project meetings to:
- Review progress and upcoming work
- Address potential issues early
- Document decisions and action items
- Ensure all stakeholders are aligned
Put everything in writing, even if previously discussed verbally. Follow up important conversations with email summaries confirming what was discussed and agreed upon.
Risk Management Strategies
Proactive risk management significantly reduces claim likelihood. Consider these approaches:
Conduct pre-construction planning schedule review meeting. Be knowledgeable of and follow the plans and specifications. Prepare a Baseline Schedule and stick with it. Meet with your project manager and consult with your scheduler often.
Regular schedule updates and reviews help identify potential delays early when there’s still time to implement corrective actions and mitigate potential issues that may arise as the project reaches completion
Contract Administration Best Practices
Proper contract administration is crucial for claims prevention. Focus on these key areas:
Review contract documents thoroughly before work begins. Ensure all parties understand their responsibilities and contract requirements.
Pay special attention to:
- Notice requirements
- Change order procedures
- Schedule requirements
- Documentation requirements
- Dispute resolution procedures
Follow contract procedures strictly, especially regarding change orders and time extensions. Maintain detailed records of all contract-related communications and decisions.
Taking Action
While these strategies require investment in time and resources, they’re far less costly than dealing with claims after they arise. Remember:
- Address issues promptly when identified
- Document everything
- Maintain open communication
- Follow contract procedures
- Seek expert advice when needed
Need help implementing these strategies? The Swaney Corporation / Crowe Construction offers comprehensive construction management services to help prevent claims before they occur. Contact us to learn how we can help protect your project.