HQControl • Construction Law Simplified

Free Construction Contract Risk Protection Pack

Two practical checklists to help construction organisations protect their claims, cash flow and project margins before problems become disputes.

Prepared by Steven Chin, The Contract Claims Guru

Section A: Executive Project Contractual Risk Health Check

The 15-Question Construction Project Contractual Risk Health Check is designed for Managing Directors, Project Directors, Commercial Directors and senior management. Answer each question honestly to assess whether your project is contractually controlled, vulnerable, or in need of immediate management attention.

Question 1

Are variations being carried out before written confirmation has been received from the Engineer or Contract Administrator?

YesPartlyNo

Why this matters: Verbal variations without written confirmation create unvalued work. Under the Four-Corner Rule, if the variation is not documented within the contract, payment entitlement may be lost entirely.

Question 2

Is the total value of unvalued variations reported to senior management on a monthly basis?

YesPartlyNo

Why this matters: Unreported variation values create a false picture of project profitability. By the time the exposure is identified, the cumulative effect on cash flow may be irreversible.

Question 3

Does the project have a proper contractual notice calendar with all critical deadlines identified and assigned?

YesPartlyNo

Why this matters: Failure to issue notices within contractual time limits can extinguish entitlement entirely. Time bars under FIDIC Sub-Clause 20.1 (1999) and similar provisions are strictly enforced.

Question 4

Has the project team been briefed on all amendments made to the standard contract form (e.g., FIDIC, PAM, JKR) in the particular project contract?

YesPartlyNo

Why this matters: Standard form amendments often shift risk materially. If the team assumes standard form protection without reviewing the particular amendments, critical entitlements may be lost.

Question 5

Are payment deductions and under-certifications being formally challenged within the contractual time limits?

YesPartlyNo

Why this matters: Silence on payment deductions may be construed as acceptance. Under most standard forms, failure to give notice of dissatisfaction within the stated period results in the determination becoming final and binding.

Question 6

Are delay events being recorded contemporaneously with supporting records, or only after the fact?

YesPartlyNo

Why this matters: Delay records prepared after the event are inherently less credible. Contemporaneous records are the strongest evidence in delay analysis and dispute resolution.

Question 7

Do monthly management reports show the contractual and commercial health of the project, not merely the physical progress?

YesPartlyNo

Why this matters: Physical progress tells you what has been built. Contractual and commercial health tells you whether you will be paid for what has been built and whether you are exposed to claims.

Question 8

Are verbal instructions from the Engineer, Employer or Project Manager always confirmed in writing with a request for written instruction?

YesPartlyNo

Why this matters: Verbal instructions create ambiguity. If the instruction is disputed later, the absence of written confirmation leaves the contractor without contractual evidence.

Question 9

Are contractual time bars being actively monitored with a system that alerts the responsible person before deadlines expire?

YesPartlyNo

Why this matters: Time bars are strictly enforced across Common Law, Civil Law and Sharia jurisdictions. Missing a notice deadline can extinguish entitlement regardless of its merit.

Question 10

Has responsibility for issuing each category of contractual notice been clearly assigned to a named individual?

YesPartlyNo

Why this matters: When everyone is responsible, no one is responsible. Unassigned notice obligations are the most common cause of missed deadlines on construction projects.

Question 11

Do your variation records contain the instruction, costs, resources, dates and supporting evidence for each variation?

YesPartlyNo

Why this matters: Incomplete variation records cannot support a claim. The burden of proof rests on the party making the claim, and the records must demonstrate both entitlement and quantum.

Question 12

Are Extensions of Time (EOT) being prepared and submitted before contractual deadlines expire?

YesPartlyNo

Why this matters: Late EOT submissions may be time-barred under many standard forms. Even where the delay event is genuine, the contractor may lose entitlement by failing to comply with procedural requirements.

Question 13

Are payment claims fully supported with the required documentation and submitted strictly in accordance with the contract requirements?

YesPartlyNo

Why this matters: Payment claims that do not comply with contractual requirements may be rejected on procedural grounds, creating cash flow pressure and potential escalation to dispute.

Question 14

Are unresolved claims and contractual risks being escalated to senior management before they become disputes?

YesPartlyNo

Why this matters: Early escalation enables strategic decision-making. By the time a claim becomes a dispute, the options for commercial resolution are narrower and more expensive.

Question 15

Does the project have a properly organised contractual and claims record system that enables retrieval of documents within minutes?

YesPartlyNo

Why this matters: Disputes are won and lost on evidence. A disorganised record system means that valid claims cannot be substantiated and invalid claims cannot be refuted.

Your Project Risk Score

Count your answers and assess your overall contractual risk position:

Green — Contractually Controlled: Most answers are "No" (meaning the risks are addressed). Your project has adequate contractual controls.

Amber — Contractually Vulnerable: A significant number of "Partly" answers. Your project has gaps that could be exploited in a dispute.

Red — Immediate Management Attention Required: Multiple "Yes" answers indicating active risk exposure. Immediate action is recommended.

Section B: Project Team Protection Checklist

The Notice, Variation and Payment Claim Protection Checklist is designed for Project Managers, Commercial Managers, Contract Managers, Quantity Surveyors and project execution teams. Use this checklist to verify that your project records and procedures are protecting your entitlement.

1. Contractual Notices

Correct contractual clause — The notice is issued under the correct contract clause (e.g., FIDIC Sub-Clause 20.1, PAM Clause 24.1)

Correct recipient — The notice is addressed to the correct party as stated in the contract (Engineer, Employer, or their authorised representative)

Correct service method — The notice is delivered by the method prescribed in the contract (registered post, email to specified address, hand delivery with acknowledgement)

Notice deadline — The notice is issued within the contractual time limit (e.g., 28 days under FIDIC 1999 Sub-Clause 20.1)

Date of awareness — The notice records the date the party became or should have become aware of the event

Event description — The notice contains a clear description of the event or circumstance giving rise to the claim

Likely effect on time — The notice states the expected or actual effect on the contractual completion date

Likely effect on cost — The notice states the expected or actual financial impact

Reservation of rights — The notice expressly reserves the party's right to claim additional time and/or cost

Supporting records — The notice is accompanied by or references contemporaneous supporting records

Further particulars to follow — The notice states that further details will be provided in due course (where the full quantum is not yet known)

Proof of service — Evidence of delivery (email read receipt, registered post tracking, signed acknowledgement) is retained

2. Variations

Written instruction — The variation is supported by a written instruction from the authorised person

Confirmation of verbal instruction — Any verbal instruction is followed up with a written confirmation memo recording date, instruction and parties

Authority of the person issuing — Verify that the person instructing the variation has contractual authority to do so

Description and scope — The variation record clearly describes the changed work and its scope relative to the original contract

Date of instruction — The date of instruction is recorded and cross-referenced with the site diary

Labour records — Man-hours, crew sizes, and productivity data for the varied work are documented

Plant records — Equipment types, duration of use, and rates for the varied work are documented

Material records — Material quantities, costs, delivery records and wastage for the varied work are documented

Subcontractor costs — Subcontractor quotations, invoices and delay impacts for the varied work are documented

Photographs — Before, during and after photographs of the varied work are dated and stored

Programme impact — The effect of the variation on the project programme is assessed and recorded

Valuation submission — A formal variation valuation is submitted within the contractual time limit

Follow-up reminders — Follow-up correspondence is sent if the variation valuation is not responded to within the contract period

Outstanding approval status — The current status (pending, partially approved, rejected, referred to dispute resolution) is tracked

3. Payment Claims

Correct claiming party — The claim is submitted by the party entitled to payment under the contract

Correct paying party — The claim is addressed to the correct paying party as defined in the contract

Contract reference — The payment claim clearly identifies the contract name, reference number and project

Claim period — The claim period (start and end dates) is clearly stated

Amount claimed — The total amount claimed is clearly stated and supported by detailed breakdown

Due date — The payment due date is identified and the claim is submitted to meet the contractual submission deadline

Supporting valuation — The claim is supported by a valuation prepared in accordance with the contractual measurement rules

Variation breakdown — Approved and pending variations are separately identified within the claim

Progress evidence — Physical progress records (programme updates, site reports, inspection records) support the claimed progress

Invoices and delivery records — Material invoices, delivery orders and plant hire records are cross-referenced

Previous payment position — The claim accounts for all previous payments received and certificates issued

Deductions disputed — Any deductions or retentions applied by the Employer/Engineer that are disputed are formally challenged

Proof of service — Evidence that the payment claim was submitted in accordance with the contract (delivery receipt, email confirmation) is retained

Payment-response deadline — The deadline for the Employer/Engineer to issue the payment certificate is identified and monitored

Escalation and dispute options — The process for disputing a late or under-certified payment is understood and documented (e.g., referral to DAAB, adjudication under CIPAA, or arbitration)

Disclaimer: This Construction Contract Risk Protection Pack is provided for general educational and informational purposes only. It does not constitute legal advice, legal opinion, or legal representation. The checklists and assessment criteria are general in nature and may not address all applicable contractual requirements in your specific jurisdiction or contract. You should consult a qualified construction law professional for advice tailored to your specific circumstances. Use of this material does not create any professional advisory relationship between you and HQControl or CIDEC Consultancy.

Protect your project before contractual problems escalate.

Return to HQControl