We give some tips on how to maximise chances of recovering costs of remedial works from a defaulting party.
When a party is forced to carry out remedial works due to the fault (e.g. breach of contract or negligence) of another party, it will want to recover the full cost of those works from the defaulting party.
Yet an innocent party must remember that its right to recover is fettered by a number of considerations, the foremost being a legal principle called “mitigation of loss”. This provides that a claimant cannot recover losses that it could have avoided by taking reasonable steps.
Bearing this in mind, here are five practical tips to help ensure that you recover as much as possible in respect of the remedial works that you have to carry out as a result of another party’s fault:
- Carry out a careful and detailed survey of the defective work, including photos and plans showing the location and extent of the defective work. It is advisable to instruct an expert in the appropriate field to do this;
- Instruct the expert to advise on what remedial works need to be carried out, and follow that advice;
- Allow the defaulting party to carry out its own inspections before the remedial works are carried out. If you don’t, you may face the allegation later down the line that you have destroyed evidence of the defective work;
- Consider any reports produced by the defaulting party or its experts. You are not bound to accept what they say, but if they throw your own expert’s findings into doubt, it may be worth obtaining a second opinion from another expert; and
- Keep the defaulting party fully informed as to progress of the remedial works, including at the tender stage.
Following these steps will not necessarily guarantee a full recovery – remember that any works considered to be ‘betterment’ will probably not be recoverable – but they will increase your chances considerably.