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Contracts & Legal

Claim

In Plain English

A formal demand by a contractor for more money or time based on events outside the original contract scope.

Definition

A claim is a demand by one party to a construction contract for additional compensation, time extension, or other relief under the contract. Claims typically arise from changed conditions, scope changes, owner-caused delays, or differing site conditions. Claims must be submitted within contractually specified time limits or they may be waived.

Why It Matters in Bidding

Claims are where a contractor's margin is either protected or eroded after award, since unbudgeted changes and delays directly hit the cash flow estimators priced at bid time. Strong cost coding, daily reports, and an audit trail from the original takeoff are what make a claim recoverable rather than a write-off. Missing the contractual notice window can waive an otherwise valid entitlement entirely.

Example

After hitting unexpected rock during excavation, a site contractor submits a $180,000 differing-site-conditions claim with photos, survey logs, and revised quantity takeoffs before the 14-day notice deadline in the contract.

Related Terms

Change OrderDispute ResolutionDelay ClaimNotice

Frequently Asked Questions

A change order is a negotiated, signed modification both parties agree to, adjusting price or time before work proceeds. A claim is a contested demand the owner has not accepted, usually filed because the parties disagree on entitlement or amount. Many claims begin as change order requests that were rejected or ignored.
Give written notice within the contract's stated deadline, then build the record: daily reports, time-stamped photos, cost coding segregated to the impacted work, schedule fragnets showing delay, and correspondence. Track actual costs separately from base-contract costs so you can prove damages later without reconstructing them from memory.
Common bases include differing or concealed site conditions, owner-directed scope additions, defective design documents, owner-caused or weather delays beyond contract allowances, suspension of work, and constructive changes where direction effectively expands scope. Each requires proof of entitlement under a specific contract clause plus documented cost or time impact.

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