Financial worksheets and calculation records prepared for dispute analysis

Expert witness

Contractor, Owner & Subcontractor Damages Calculations

Damages analysis work differs by position in the chain, and the same event produces different, sometimes inconsistent, claims at each level of it.

A contractor claims unpaid work, changes, disruption and time-related cost. An owner claims completion cost, delayed use and rectification. A subcontractor claims against a party that is itself claiming upstream, which raises the question of whether amounts are being passed through, absorbed or double-counted.

Damages analysis may consider direct records, estimates, allocations, comparisons or other supported information. The use of component or aggregate calculations depends on the question and available support; assumptions and possible duplication are addressed in context.

Damages calculations differ by role, and the differences are substantive rather than presentational. A contractor's loss is typically prolongation, disruption and unrecovered cost; an owner's is completion cost, delayed use and consequential effects; a subcontractor's is bounded by a contract with the contractor rather than with the owner, and the chain matters.

Analysts may consider whether cost categories duplicate one another and whether amounts have been attributed more than once. The significance of any duplication depends on the calculations, records and questions presented.

Ledger printouts and cost reports arranged across a work surface

Possible assignment considerations

In practice

  1. 01

    Establish the role and the contract chain

    Identify whose loss is being calculated and which contractual relationships bound it.

  2. 02

    Assess the cost records

    Determine whether cost can be tied to work, and state plainly where allocation replaces measurement.

  3. 03

    Consider cost categories and duplication

    Damages analysis may consider direct records, estimates, allocations, comparisons or other supported information. The use of component or aggregate calculations depends on the question and available support; assumptions and possible duplication are addressed in context.

  4. 04

    Test for duplication

    Check across the heads for the same cost appearing more than once before the figure is relied on.

Considerations and limitations

Questions and limitations to consider

Double counting across heads

The same cost recovered within prolongation, disruption and a change order.

Allocation presented as measurement

Assumptions doing the work of records without the calculation admitting it.

Pass-through as a single figure

Presenting a subcontractor's loss without making the contractual chain traceable.

Contractor, Owner & Subcontractor Damages Calculations

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