When does a claim against me become a dispute?
It can become one once the claim is rejected, or left unanswered for long enough, but exactly when is a legal question.
Updated: . By Jack Butler-Kettle, Construction Claims Consultant.
The answer
In everyday terms, a claim is a demand for something the other side says it is owed, and a dispute is a disagreement that has not been settled. The exact point matters because it decides when either side can refer the matter to adjudication, so check it with your solicitor. In practice, it runs like this. A letter reserving your main contractor's rights, or alleging poor performance, is a warning. A schedule with figures is a claim that needs a written answer. A claim that has been rejected, or left unanswered for long enough, may already be a dispute that either side can refer to adjudication. So log every allegation and figure you receive, answer each one in writing, and note any urgent date.
Example
Illustrative example. The scenario and figures are invented.
The facts
A subcontractor gets a letter from its main contractor saying it will hold the subcontractor responsible for delay costs. A month later, a schedule arrives claiming £60,000. The question is when this becomes a dispute that could be referred to adjudication.
What happens
- The first letter names no figure. It is logged as a warning, and a written reply puts the subcontractor's own records on the file.
- The schedule is a claim. It is tested head by head and answered in writing within the time the subcontract allows.
- If the main contractor rejects the answer, or leaves it unanswered, the subcontractor's solicitor is asked to check it. The question is whether a dispute now exists, and so whether either side can refer it to adjudication.
The outcome
The subcontractor's answers are on the file at each stage, so whichever side refers the dispute, the file already holds a reasoned response.
Our Counterclaim Defence service tests a claim made against you and builds your answer; Counterclaim Prevention sets up the records that answer one before it is made.