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Lessons Learned - Another Name for Claims Avoidance

MCS specializes in Claims Management and Evaluations and sees many examples of claims based on what went wrong and, correspondingly, what could have been done to prevent the circumstances that led up to the claim. As usual, claims work is an after the fact service, i.e., when things go sideways. MCS  takes the lessons learned from its claims work and applies them to the planning and administration of a project. MCS can help you prepare your risk management plan to avoid future claims. 

A Project Manual establishing the lines of communications, lines of authority, processes, procedures and other pertinent matters that will be used in the development and management of the project is a good starting foundation. The Project Manual is not a stagnant, one and done, document. It must be updated, reviewed, distributed and used throughout the project. However, the Project Manual is not the sole answer.

There are other issues, which, in hindsight, appear to be common sense, that may determine whether you face a claim or not. For instance, more detail is not always better. When a project manager develops and issues a detailed and sometimes too aggressive schedule and makes it a contract document, the detail might become the facts upon which a potential claim may be launched. It might be better to provide only start, completion and certain other critical intermediate milestone dates for which the contractor is responsible, rather than providing a series predecessor activities and dates associated with the work of other contractors leading up to the milestones dates. The project manager must have the detailed work plan and schedule for his/her use, but think twice before making it a contract document. 

Another trouble spot is how much record keeping and documentation is enough or is too much. It depends on the type and complexity of project, the cast of character involved, the relationships and histories of the parties - both at a company and at a personal level as well as other pertinent, project specific matters.

For one, communications and documentation, which create a record of the timeline, progress, job site conditions, weather, workforce, work areas, deliveries, delays, response time, etc. is critical to defending a claim and/or making a counter claim. Many contracts require a contractor to give timely written notice of delays and/or added costs. The ability to have a record to which to refer can defuse a potential claim before it can mature. Also, be cognizant of meeting minutes, emails, speed letters and other “informal” communications. Do not let any formal and informal communications go unanswered. Do not file them away for another day. Do not believe, for one moment, that any issues will go away of their own accord. All of these are the makings for a future claim, which can lead to costly disputes and litigation.

These are but two examples of where things went wrong leading to expensive defenses and resolutions. There is no formula - there is no one correct answer. Just let common sense and experience be your guide. As they say, “it’s just business!”

If you have any questions or would like a consultation, MCS welcomes the opportunity and is ready to assist by advising you how to prepare your project for claims avoidance as well as subsequent claims management and evaluation.

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