What if the contract says nothing about final accounts?
Prepare a final account anyway, but do not invent a legal due date or notice timetable for it.
Updated: . By Jack Butler-Kettle, Construction Claims Consultant.
The answer
First pin down what was agreed, what kind of payment this is, and whether any fallback rules set by law apply. Asking for a reply by a sensible date can move things on. But that is not the same as a payment deadline the law will enforce. Once you know which payment rules apply, reconcile the balance. Then follow those rules on applications, notices and responses.
Example
Illustrative example. The scenario and figures are invented.
The facts
A subcontract says nothing about final accounts, so there is no stated trigger or dates for payment. The account has to be built from the documents that exist.
What happens
- The order, the agreed price, the variations, the payment history and the correspondence are gathered.
- The account schedule is prepared from those documents.
- The payment trigger and the dates are marked as unresolved until the rules that apply have been checked.
- A proposed reply date is kept separate from the payment dates until those are known.
The outcome
The account goes forward on the documents that exist, with the trigger and the dates shown as open until the rules are checked.
To have your closing account reconciled to the subcontract sum and the payment history before it goes in, see our Final Account Dispute Prevention service.