Will Contra-Charge Prevention stop our main contractor taking deductions?
No, and it is not meant to: it makes sure every deduction is seen, logged and challenged in writing while it can still be answered.
Updated: . By Jack Butler-Kettle, Construction Claims Consultant.
The answer
Your subcontract probably lets your main contractor deduct. But the right usually has conditions: a notice given in time, a chance to fix a defect yourself, a cost that can be shown. We start by putting what your signed subcontract allows, and what the main contractor must do first, on one page. Your commercial team keeps it beside the payment paperwork. Then we set up the routine. Your team checks every Payment Notice and Pay Less Notice the day it arrives and logs every deduction. Within the week, it sends a written challenge asking for the basis, the notice, the evidence and the build-up. Alongside that go the records that answer the common back-charges before they are raised. These are signed handovers of finished areas, dated photographs before the next trade moves in, and a written reply to every notice to remedy. We prove the routine on your next live payment cycle, and then your own team runs it. An optional Ongoing check each month flags any deduction left unanswered. A charge that is properly made may still stand. What changes is that each one is answered in writing, not left to become agreed by silence.
Example
Illustrative example. The scenario and figures are invented.
The facts
A drylining subcontractor has let a year of small back-charges go unanswered. Its subcontract lets the main contractor deduct for cleaning, damage and attendance after written notice.
What happens
- We put the set-off clause, the notice and remedy conditions and the payment timetable on one page, which the commercial team keeps.
- On the next live cycle, the Pay Less Notice carries three new deductions. The team logs each one in the register the day it arrives.
- Within the week, the team sends a written challenge asking for the basis, notice, evidence and build-up of each.
- The main contractor withdraws one when it cannot produce a build-up. It reduces another once the build-up shows another trade's area.
- The third is backed by a dated photograph of damage in the subcontractor's own area, and the subcontractor accepts it.
The outcome
The main contractor still deducts. But every deduction is answered in writing within the week, and the one that stands is one the evidence supports.
To have every deduction logged and challenged the week it lands, see our Contra-Charge Prevention service.