An 80% recovery of a £2.5m claim

Our client is an award-winning company that provides design, build and operates services to the water and wastewater industry. Based in both Ireland and the UK, it has a turnover of £250m. We were asked to recover project time and costs that had been incurred due to changes caused by its water sector client.

Establishing a project recovery plan

The client contacted us as its project completion date had passed the date agreed in the contract. As such, the company was exposed to liquidated damages totalling £2.5m, plus the additional cost of having to perform the work over a longer period.

Our client’s customer, a major water and sewage service provider, was intending to deduct liquidated damages from payments due to our client, yet our client felt they were not the cause of the extended time and increased costs. With limited in-house capability to deal with the issue, we were asked to lead the recovery plan.

Document submission and negotiation

We began by organising a workshop with the team to learn more about the situation and to establish a recovery plan. We identified four issues that were the driving causes for the project delays and increased costs.

We prepared an end-to-end document that outlined our client's entitlement to recover, the impact of the delay and the cost of each event. We submitted the document to our client for consideration and our client asked us to support them by preparing documents for the purposes of negotiation and attending meetings with their client to resolve the issue.

A strengthened relationship

After a period of negotiation our client successfully agreed a time extension of 417 days to cover the delay period. This relieved our client of its liability for damages and the discussions on the quantum of the prolongation costs resulted in recovery of 80% of the claim amount submitted.

Due to the way the matter was handled by us, the relationship between the two parties was strengthened and we have since worked with the client on other projects, supporting them in their objective to strengthen their commercial performance.

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