Daily reports can nip problems in the bud

Most general contractors on commercial and public construction projects are required to generate and submit daily reports to their customers. Sometimes but not as often general contractors require their major subs to fill out their own daily reports and submit them to the general. The field people who have to complete these forms have been known to grumble about how their valuable time is wasted filling

Most general contractors on commercial and public construction projects are required to generate and submit daily reports to their customers. Sometimes ā€” but not as often ā€” general contractors require their major subs to fill out their own daily reports and submit them to the general.

The field people who have to complete these forms have been known to grumble about how their valuable time is wasted filling them out, if they haven't delegated the task to the least busy person they can find. It is not uncommon to find two weeks' worth of daily reports prepared and submitted at once, because a check is being held up until they come in.

As a lawyer who has had to come in, years later, to reconstruct the history of what happened on a job, I guess I can be expected to be a big fan of detailed daily reports. When a lawsuit is filed, there is no better tool for proving what really happened than a contemporaneous daily report. I get positively giddy when I see:

Head counts of various trades on site. It is much easier to prove that a default termination was valid if you have the actual numbers of workers on site, rather than just someone's recollection that "they weren't manning the job."

The effect of weather on work. NOAA weather reports in any town are taken from one station that may not reflect the actual wind conditions on your site that prevented erecting steel in the air. They also don't generally tell you the time of day when precipitation fell, so that you can show whether work was possible during part of the day.

Inspections and visitors. A later dispute over whether work was covered up before inspection can be put to rest quickly if the daily report reflects both work done to date and the time of all inspections. Noting when visitors arrived and who they were often later helps jog memories of what transpired.

List of materials and equipment on site. Knowing these things allows me later on to prove if the contractor was adequately manning the job. Lack of equipment and materials is also frequently a first sign that a contractor is having credit problems that could lead to a lien.

All these are examples of how, if a dispute arises, the daily report is a mighty weapon in the fight for truth and justice. A well-managed contractor, however, should consider requiring its field forces to generate a detailed daily report even where the client isn't demanding it, and requiring its project management staff to review the report, to avoid disputes.

For example: Equipment "parking." Equipment leasing firms have been known to deliver equipment early, or not remove it promptly when requested, if they don't have another place to put it, knowing that there is generally a presumption that they are entitled to charge rent ā€” and can file a lien or bond claim if they don't get paid. A project manager or business owner who sees equipment on site when it isn't actually needed can quickly intervene and avoid an unnecessary charge.

Material misdelivery. Some supply houses have a practice of delivering to a bonded project, even if it is to be used on an un-bonded project, so that they can improve their chances of collection. Not only does this create extra accounting and material handling, but it also can lead to theft and vandalism because the site where it was delivered was not ready for it. Since field and office staff may not communicate on an hourly basis to catch the problem, a cross-check of daily reports to ordering data can let you nip this practice in the bud.

Simmering problems. You want your people to let you know if anything is preventing the smooth flow of their work so that you can try to do something about it. If you let them know that you are serious about having the entire form completed, and not just the date, weather and headcount, you can get information at the earliest possible time that will allow you to intervene to avoid losing time or money. This could lead to photographs and video to document conditions, getting architect or engineer decisions and meetings or letters to get a problem solved quickly.

Good use of daily reports requires three components: a well thought-out form that asks for all the right information; a trained field person to thoughtfully complete the form; and a diligent project manager to read the report and follow up on any issues gleaned. Yes, it

will take time of both field and office staff to use them effectively (although I know of contractors who set it up to be done on laptops in the field, which cuts down on time and paper work), but that ounce of prevention can allow you to manage and control, if not totally avoid, many tons of cures later.

TAGS: Law