Should I sign a full and final settlement of my final account?
Only after you have checked the figure and the payment terms, and your solicitor has checked the rights you are giving up.
Updated: . By Jack Butler-Kettle, Construction Claims Consultant.
The answer
A good headline figure does not make the whole deal acceptable. The release is where you give up rights, so its wording matters as much as the number. Check what the release covers, and whether retention or other open items are left out of it. Check the payment date, the tax treatment, any security, who has authority to sign, and any confidentiality or costs wording. A commercial review compares the offer with what you can prove and what carrying on would cost. Your solicitor needs to check the rights being released and what the wording does.
Example
Illustrative example. The scenario and figures are invented.
The facts
A demolition subcontractor is offered £150,000 against a reconciled £175,000 account, with £12,000 retention and a separate £20,000 disruption item unresolved. The subcontractor is asked to sign a full and final settlement.
What happens
- The commercial review records the proposed discount, the payment timing, tax and security.
- The solicitor checks whether the release covers the retention, the disruption and unknown project claims.
- The subcontractor decides only after that review and an authority check.
The offer in figures
| Item | Amount |
|---|---|
| Reconciled account | £175,000 |
| Offer | £150,000 |
| Retention | £12,000 |
| Disruption item, unresolved | £20,000 |
The outcome
The decision is taken with the review and the authority check on file. The questions asked are the point. Nothing here shows that the settlement is fair or that any right survives it.
Our Final Account Claim reconciles the numbers before you sign anything final.