Search

How can we help?

Icon

How do I prove my final account claim?

Many construction disputes relate to the calculation of the final account. Sometimes there may be an interesting point of law or expert evidence at stake.  More often than not, the dispute will boil down to proving what work was done and / or what was the agreed price for the work.

These issues came into play in the recent case of Premier Engineering (Lincoln) Limited v MW High Tech Project UK Limited. The underlying project was very large (£150m) but Premier started work on a very small subcontract. When MW fell out with another subcontractor Premier agreed to supply additional labour to help MW the project back on track.  The work was carried out on an ad hoc basis – MW told Premier each week what work was required, Premier did the work and invoiced according to its timesheets. Come the end of the project, the parties were unable to agree Premier’s final account.  Premier claimed an additional £1.3m, whereas MW said that it had already overpaid.

The dispute fell into two main categories – labour and materials – which the court unravelled over the course of an 80 page judgment.

The labour charges represented by far the largest part of the claim.  Premier’s claim relied on its timesheets that had been signed each week by an authorised MW representative.  MW sought to distance itself from the timesheets for two reasons. Firstly, it said that it signed the timesheets without carefully checking them ‘to keep the peace’.  Secondly, the turnstile records at site suggested that the hours worked were lower than claimed.  The Judge rejected both arguments.

Signed timesheets are primary evidence that work has been done. It was MW’s own fault if it had not adequately resourced the job to check the timesheets before signing them off.  This was the best opportunity for MW to raise any concerns about the sums claimed. In any event, MW had challenged the timesheets from time to time.

Turnstile data could have been relevant evidence.However, in this case Premier had raised concerns about the turnstiles – sometimes they were not working and on other occasions Premier’s operatives were working outside the area covered by the turnstiles. The Judge concluded that the parties had agreed that the turnstile data would not be taken into account. They agreed instead to use a biometric clock but this was not installed on site until a later date.

The dispute fell into two main categories – labour and materials – which the court unravelled over the course of an 80 page judgment.

The materials claim threw up a different challenge.  About £100k turned on the claim but it covered very many individual invoices, some of which were low value.  It would not have been realistic for the court to consider every invoice.  Instead it applied a ‘materiality threshold’ to exclude the lowest value invoices. It examined a representative sample of the remainder and used the conclusions on these to determine what was due under the entire batch of invoices.

The case is good illustration of how the court will approach such a claim and the challenges of determining a final account that it for a large sum but made up of very small items.  It also emphasises the importance the claiming party keeping contemporaneous records and the paying party raising objections at the time.

About this article

Disclaimer
This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full General Notices on our website.

About this article

Read, listen and watch our latest insights

art
  • 22 February 2024
  • Employment

Time to take the heat off menopausal women

On 22 February 2024, the EHRC released guidance and resources for employers designed to help employers understand their legal obligations in relation to supporting workers experiencing menopausal symptoms.

Pub
  • 22 February 2024
  • Employment

Talking Employment Law: What to do if you’re at risk of redundancy

In this podcast, Harry Berryman and Rebecca Dowle, members of the employment team, will talk through the steps that need to be taken for a redundancy to be fair and the range of criteria that can be used when determining which employees will be made redundant.

art
  • 21 February 2024
  • Immigration

FAQs Partner Visa UK

Discover the UK Spouse Visa: eligibility, finances, relationship criteria, and the latest updates in 2024 for a successful application.

art
  • 19 February 2024
  • Privacy and Data Protection

The role of Data Protection Officers in ensuring compliance

How many of us receive marketing calls for products and services we did not sign up for?

art
  • 12 February 2024
  • Employment

The World of Work in 2024- What Can HR Expect?

In many senses, 2024 is unlikely to be a year with radical ruptures from those that have gone before it. The significance of 2024 though, is that it is likely to build upon those megatrends impacting the world of work, which have been emerging for some time now and are only likely to strengthen as we move on in time.

art
  • 09 February 2024
  • Privacy and Data Protection

Are we suffering from cookie fatigue?

An over-indulgence in Easter treats might not be the only cookie fatigue that individuals will suffer this year according to the Information Commissioners Office (ICO).