Can the client delay interim payments if the cashflow forecast from the contractor is delayed ?

Question

DB 2016 - The client keeps stating that their internal payment mechanism is dependant on receiving the cashflow forecast from the contractor. My view is that this is Contrary to the contract conditions and that the contractor cannot be penalised for the internal workings of the client.

Esteban Amirante · Answer

Whether a client can delay interim payments due to a delayed cash flow forecast from the contractor depends on the specific terms and conditions outlined in the contract between the parties.

Construction contracts usually contain provisions that address payment mechanisms, including situations where delays may affect payment obligations. It is important to review the contract thoroughly to determine whether there are any clauses or provisions that permit the client to delay interim payments in such circumstances.

Commonly, contracts may include provisions for the suspension or delay of payments if certain conditions are not met or if the contractor fails to provide necessary documentation, such as a cash flow forecast, within a specified time frame.

Additionally, the contract may outline any remedies or dispute resolution procedures if interim payment delays occur. This could involve negotiation, mediation, or potentially legal action, depending on the contract terms and the parties' willingness to resolve the issue.

Ultimately, the specific provisions in the contract will govern whether the client can delay interim payments in the event of a delayed cash flow forecast from the contractor. It is crucial to carefully review the contract and consult with a legal professional who specializes in construction law to understand the rights and obligations of each party involved.

Can the client delay interim payments if the cashflow forecast from the contractor is delayed ?

Delay

interim

forecast

cashflow

client

Payments

FAROUK Yusuf

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