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  • record keeping
25 Jul 2017

Good records – why they are important and essential

by Paschal Walsh, Regional Director, UK South - UK, South

Taking shortcuts with your project records is likely to dramatically reduce the success of your claims. 

You may well have heard of the response to the question: “What are the three important basic elements to assist production of (or defence against) a claim?” Well, the answer: “RECORDS, RECORDS and MORE RECORDS” may seem an oft repeated mantra, but there are sound reasons why good record keeping is essential.

To start with, it is good practice and essential for managing the contract and monitoring progress. No-one can foresee the future, and good records are the basic requirements for production of claims or defence against claims from others. Accurate and focussed records will diminish adversarial conduct, as the events surrounding a dispute can be reconstructed from available material. Apart from supporting a party’s case or line of argument, reliable contemporaneous documents will assist those who are not as familiar with the complete history.

There are also minimum requirements for preparing for, establishing and evidencing a claim. These include a regularly updated as-built programme and a register of drawings and documents, revisions, submission and return dates; official progress meeting minutes; claim notices and a directory of issues. The evidential burden in establishing entitlement is on the party who claims. Clearly, the better the records the easier it will be to support your assertions, prove your case and come away with an ‘early win’. Equally, if you are resisting a claim, the absence of proper substantiation is a legitimate reason for putting up a robust defence. This could lead to prevarication and delay for the hapless party who does not keep proper records.

There are, however, more fundamental reasons for good record keeping, and those are the requirements of the contract. Consider the following extracts from some of Standard Forms:

JCT:         “….in respect of each event…give particulars including an estimate of any expected delay” and “submit details of the loss and/or expense as are reasonably necessary for such ascertainment”

ICE:          “…. keep contemporary records as may reasonably be necessary to support any claim he may wish to make. The Engineer may instruct the Contractor to keep such further records as are reasonable and may be material to the claim”

FIDIC:      “…. The Contractor shall also submit……supporting particulars for the claim, all as are relevant to such event or circumstance. …. The Contractor shall keep such contemporary records as may be necessary to substantiate any claim, either on the Site or at another location acceptable to the Engineer. The Engineer may…monitor the record-keeping and/or instruct the Contractor to keep further contemporaneous records. The Contractor shall permit the Engineer to inspect all these records, and shall (if instructed) submit copies to the Engineer…”

So, not only are there contractual obligations in respect of record keeping, but the whole process is monitored and enforced by the Contract Administrator. Under some contracts, submission of timeous notices with particulars and documents are a condition precedent to entitlement to time and money (e.g. NEC sub-clause 61.3 and FIDIC sub-clause 20.1).

In fact, in one decided case (AG of Falkland Islands v Gordon Forbes Construction Ltd), the Judge dismissed the Contractor’s claim because of a lack of contemporaneous records. In this case, a housing development was constructed using the 1987 FIDIC 4th Edition. One of the contractual clauses required the Contractor to keep such contemporary records as were necessary to support the claim. Such records that had been kept were inadequate to verify what the Contractor was claiming. The Contractor thought it could fill in any evidential gaps with verbal evidence. The Engineer did not accept this and the Court agreed. Verbal evidence was not contemporaneous records – claim dismissed!

So, where there are no contemporaneous records to support a claim, the claim could fail completely. Consistent contemporaneous records can win the claim; whilst inconsistent and poor records risk losing a claim. The type of records that are necessary will depend on the claim. Delay and disruption claims, for example, are dependent on establishing cause and effect; what was done, when it was done and what resources were used. Records of what output labour and plant is achieving day by day need to be kept.

So what is meant by contemporary records? Well, at the time of, as opposed to, after the event. They should be sufficiently detailed to enable a third party with no project knowledge to reconstruct events solely from the information recorded. All records should be produced by reliable staff and signed and dated as true, authentic and contemporaneous, with emotive words kept out of all site records.

Factors affecting the credibility of the records (i.e. how believable they are) include the extent to which they are: contemporaneous, first hand, approved and signed, neutral and objective and corroborative and supporting evidence. There are many ways of ordering files in hard and soft copy for different topics and parties covering correspondence, minutes, changes, types of claim, drawings, photographs, site diaries and so on. At Systech, we have produced further guidance on this, including a template for a site diary, which I would be pleased to provide on request. We have also developed a site diary app, which runs on mobile devices and tablets, that can be configured with a set of questions relevant for each project. The app issues a consolidated diary report to an agreed distribution list each day and saves the information in a secure file. The app reports have been successfully used on a number of projects to evidence claims and support a robust defence against criticisms.

So, happy record keeping and good luck with those claims.

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