When does a contract claim exist?

When does a contract claim exist?

• A. When the owner rejects a contractor's request for additional money or time
• B. During initial bidding
• C. After the contractor completes the project
• D. Only after the owner approves the change order

Answer: (A)

A contract claim exists when a contractor asserts entitlement to additional money or time under the contract and that entitlement is disputed by the owner. If the owner rejects the request for more money or extra time, a formal claim has been raised because there is now a dispute over compensation or schedule, requiring documentation and possible resolution through change orders, negotiation, or dispute remedies. If the owner approves the request, it typically becomes an agreed change rather than a claim, since there’s no dispute—just a modification to the contract. This distinction is central to contract administration, where not all changes are disputed; only those that require a formal claim process.

A contract claim exists when a contractor asserts entitlement to additional money or time under the contract and that entitlement is disputed by the owner. If the owner rejects the request for more money or extra time, a formal claim has been raised because there is now a dispute over compensation or schedule, requiring documentation and possible resolution through change orders, negotiation, or dispute remedies. If the owner approves the request, it typically becomes an agreed change rather than a claim, since there’s no dispute—just a modification to the contract. This distinction is central to contract administration, where not all changes are disputed; only those that require a formal claim process.