Construction disputes divide into three: the project is late, the work is defective, or someone has not been paid. Frequently all three at once, with each side asserting the others' failures as the cause of their own.

They are also, more than almost any other commercial dispute, decided by records — and the party with the better contemporaneous record usually wins, regardless of who was actually at fault.

Most of these disputes are built into the contract

A great deal of construction in Pakistan proceeds on a one-page agreement, a rate schedule, or nothing written at all. When the relationship holds, that is fine. When it does not, there is nothing to resolve the argument with.

A workable contract should deal with:

  • Scope, by reference to drawings and specifications, with a clear statement of what is included and what is not
  • Price, and whether it is a lump sum, measured against quantities, or cost-plus
  • Payment: milestones, certification, timing, and what triggers a payment obligation
  • Retention, how much and when it is released
  • Programme, and the consequences of delay on both sides
  • Extensions of time — the grounds, and the notice required to claim one
  • Variations: who can instruct them, how they are valued, and the requirement that they be in writing
  • Defects liability period and obligations
  • Termination rights, and what happens to work in progress
  • Dispute resolution — see the arbitration clause you sign today

The clauses on extensions of time and variations are the ones that decide most disputes, and they are the ones most often missing.

Delay claims are proved on the programme

A contractor claiming an extension of time must show what caused the delay, that it was a matter entitling them to relief under the contract, and its effect on completion.

What that requires in practice:

  • A baseline programme agreed at the outset
  • Records of progress as the work proceeds
  • Notices given when a delaying event occurs — contracts commonly require notice within a defined period, and late notice can defeat an otherwise good claim
  • Records of the cause: late access, late instructions, late drawings, late payment, variations, or matters outside either party's control

Contractors who claim months of delay at the end of a project, with no contemporaneous notices and no programme, are asserting rather than proving.

The employer's mirror image is liquidated damages for delay, which depend on the contract providing for them.

Variations: get them in writing

The recurring dispute: the contractor says additional work was instructed verbally on site; the employer says it was included in the scope, or was never instructed at all.

Contracts almost always require variations in writing. On site they almost never are. The result is an argument nobody can win cleanly.

The discipline is simple and rarely followed: confirm every instruction in writing, at the time, even if only by message — "further to your instruction this morning to add X, we will proceed on the basis that this is a variation." An unanswered written confirmation is worth a great deal months later.

Defects

The employer's claim is that the work does not comply with the specification. The contractor's answer is frequently that the design was inadequate, that materials were employer-supplied, or that the complaint is about workmanship tolerance rather than breach.

These turn on expert evidence and on inspection records. Photograph the work as it proceeds — particularly anything that will be covered up — and record inspections and approvals. Once concrete is poured, the evidence of what is inside it is whatever you recorded at the time.

Unpaid contractors

Non-payment is the most common construction claim, and the practical questions are the ordinary ones for recovery: is the debt evidenced, and can the employer pay?

Remedies include a suit for recovery of certified and uncertified sums, a claim in quantum meruit for work done where the contract is unclear or terminated, and interim relief where assets may be dissipated. See recovering money owed in Pakistan.

Before suspending work for non-payment, check the contract. Suspension without a contractual right can itself be a repudiation, converting a good payment claim into a defence.

For homeowners and small developers

If you are building a house or a small project:

  • Put it in writing, however well you know the contractor
  • Pay against milestones tied to completed work, not against dates
  • Hold retention, and release it after the defects period
  • Keep the drawings and specification as contract documents
  • Take photographs weekly, dated
  • Confirm every change in writing before it is built

The cost of a properly drawn contract is trivial against the cost of a stalled build with a half-finished structure and a contractor who has moved on.

How the firm can help

We draft and review construction contracts, and act in construction disputes — delay and extension of time, variations, defects, certification, retention and termination — in litigation before the courts and in arbitration.

We also act on the property-side questions that arise alongside: title, approvals and development agreements. See property and real estate.

If a project has stalled or payment has stopped, contact the firm with the contract, the programme and the correspondence. The records determine the case, so bring them.