I've got an extension of time but no money for it
The main contractor has granted the extension of time, but says the prolongation costs and loss and expense are a separate argument.
Updated: . By Jack Butler-Kettle, Construction Claims Consultant.
For what goes into the cost for the period, see what to do when you are not sure which prolongation costs you can claim.
What's happening?
An extension of time gives you more time to finish. On its own, it does not settle whether more money is due, or how it should be worked out. The money still depends on the terms of your subcontract, the period adopted, the resources actually affected and what has already been paid elsewhere.
The usual shortcut is weeks granted times your tender preliminaries, the site running costs you priced. That may not match how your subcontract values the cost, or what was actually on site. The cost of running on and the cost of extra resources can fall in the same weeks. But the same cost must never be counted twice. Other causes, the steps you took to limit the cost, and credits all need checking too.
Treat the granted period as a guaranteed payment and the figure is easy to knock down. The job is to set the time decision beside the actual costs, and mark every assumption and specialist input.
The solution
Treat the extension of time as a decision about time. The money needs its own route under your subcontract and its own proof. Use the granted period for the cost. Then identify the staff, plant and site set-up actually kept on site because of it, from payroll and invoices, less anything already paid elsewhere. Do not multiply every granted week by your tender preliminaries and assume the total is payable. Build the cost up instead, so each period, resource and credit stays visible.
Delay & Disruption Claim builds that cost line by line and puts it to your main contractor. Whether the time was properly granted is not our call. That stays with whoever assesses time.
Example
Illustrative example. The scenario and figures are invented.
The facts
A subcontractor holds a 9-week extension of time. Its first version of the money multiplies 9 weeks by £14,000 of tender preliminaries, giving £126,000. But the extension is a time decision and nothing more.
What happens
- The subcontract's own cost clause is checked first. Its wording asks for cost actually incurred, not a tender allowance.
- The time decision is set beside a cost schedule for the period the extension covers. Each resource goes in with its period, its source cost, why it is included and anything recovered elsewhere.
- Payroll and allocation sheets support £52,000 for the site manager and the surveyor. Hire invoices support £21,000 for cabins, welfare and fencing.
- The crane was on hire at £27,000, but £9,000 of that is already inside an agreed variation. That is taken off, leaving £18,000.
- Other site costs backed by invoices add £8,000. The site engineer's £11,000 falls in the period, but he was there for a variation already paid, so it is left out.
- The claim comes to £99,000. The £27,000 gap from the first version is explained line by line, not lost.
- Whether the 9 weeks were properly granted is for a programming expert, and stays there.
The claim in figures
| Item | Amount |
|---|---|
| Site manager and surveyor | £52,000 |
| Cabins, welfare and fencing | £21,000 |
| Crane, net of the £9,000 in an agreed variation | £18,000 |
| Other site costs | £8,000 |
| Claimed | £99,000 |
| Agreed | £91,000 |
The outcome
The main contractor's surveyor challenges only the other site costs line. It agrees £91,000: the £99,000 less that £8,000 line.