Assessing mould remediation costs in adjudication

Relevant background

We supported an employer in a residential defects adjudication involving water damage and mould contamination. As quantum experts, we examined the costs of specialist remediation and reinstatement, including substantial differences between the scopes underlying the parties’ valuations.

Water leaks and mould contamination had affected apartments in a completed residential development. Specialist investigations and remediation were followed by reinstatement works, with further costs arising from the effect on residents and their possessions. The dispute concerned the reasonableness of the steps taken and the resulting costs and losses.

An earlier quantum assessment had been prepared by us before the dispute proceeded to adjudication. We were then instructed through the client’s solicitors to provide quantum expert evidence for the purposes of the adjudication and respond to the contractor’s alternative valuation.

Our appointment concerned the assessment of costs, alongside separate technical evidence and the parties’ legal submissions.

Our approach

The adjudication drew on our existing itemised valuation against the schedule of loss. This separated specialist investigation and remediation, reinstatement, costs relating to residents and other claimed losses, with calculations and supporting records for the individual items. During the expert exchanges, we explained how the figures had been assessed and tested the competing valuation against that evidence.

The scope behind each assessment was central to the dispute. The contractor’s alternative valuation relied on a notional remediation scope and cost comparisons with other apartments. We examined whether those comparisons covered equivalent work. The records for the principal apartment described full strip out and decontamination, while other apartments had required more localised treatment. Comparing the total cost alone obscured those differences in scope and duration.

We reviewed the specialist evidence and cost information to explain the resources associated with the remediation. These included containment and controlled access, specialist labour and equipment, cleaning, testing and the work identified as the apartment was opened up. Our supplementary reports addressed how labour rates, working hours and additional resources had been reflected in the valuation, including the reduced rates agreed in the remedial contractor’s final account. This connected the assessment to the actual work and conditions in which it was performed.

The reinstatement assessment required a separate examination of invoices, final accounts and variations. We explained the deductions already made for duplication and unsupported items, and the distinction between restoring the original specification and improvements. Where the original pricing lacked sufficient detail, the valuation rebuilt a replacement allowance from material and installation costs.

We addressed the opposing expert’s challenges to our cost benchmark, which used the original contract sum analysis adjusted to the period of reinstatement. That benchmark provided a further check on the scale of the actual costs.

As new evidence was submitted, we examined the supporting detail behind the contractor’s cost comparators, including whether the activities, quantities, labour assumptions and payment records could be traced. We considered how those figures related to the specialist work actually undertaken and identified where the available information did not support a direct comparison. The reports set out the reasons for the differences between the valuations so that the adjudicator could consider the individual issues.

The adjudication progressed through written submissions over approximately six weeks. We provided two supplementary quantum reports responding to the contractor’s expert evidence and the issues raised with the response and rejoinder.

The outcome

In the decision, the adjudicator preferred our approach to valuing the principal remediation and reinstatement works, finding that the narrower scope underlying the opposing valuation did not adequately reflect the work required.

On the specialist remediation costs, the decision stated: “I broadly agree with Mr Haley’s reasoned valuation except for the pro rata increase in project management time.” For one reinstatement package, our valuation of around £120,000 was adopted. The adjudicator stated: “I agree with Mr Haley’s reasoned valuation.”

The adjudication resulted in an award of around £500,000 plus applicable VAT across the claim. Several wider loss claims were reduced or excluded. The cost evidence gave the adjudicator an itemised basis for assessing the remediation and reinstatement expenditure, supported by an explanation of the scope, resources and records behind the figures.