Responding to a Client Letter on Utility Relocation: Records, Scope and Payment

Asad Ali

Thu, 27 Aug 2026

This lecture examines how a contractor should deal with a client or consultant response concerning utility-relocation works. The example relates to the extension of road at Abu Bakr Al-Sadi Road through Air Base, with the subject stated as utilities relocation in O8.

1. The Client or Consultant Response

The contractor had previously written to notify the client of a potential variation and to seek approval before proceeding with the work. The response received referred to the contractor's earlier letter, identified in the lecture as reference 999.

The response stated that the existing 13.88 kV cables had been lowered to the required level to accommodate the new road level. In effect, the client or consultant confirmed that the utility-lowering work had been completed and considered the matter resolved.

This confirmation is important because it provides written acknowledgement that the work was executed. However, the response is commercially incomplete: it does not address the cost of the work, the contractor's entitlement to payment, or the contractor's profit.

2. Why Correspondence References Matter

Formal project correspondence should clearly identify both the outgoing and incoming letter references. This allows the contractor, client and consultant to trace the subject under discussion and understand which previous communication is being answered.

For variation and claim management, linked references are particularly important because they establish a documentary sequence showing:

• What the contractor notified to the client or consultant;
• What work or issue was identified;
• How the client or consultant responded; and
• Whether the work was acknowledged, instructed, accepted or disputed.

3. Distributing the Letter Internally

Once received, the document controller should distribute the letter to the relevant project team members. The purpose is to ensure that technical, construction, planning and commercial personnel understand the development and can take the necessary action.

The lecture identifies a range of project functions that may be involved in correspondence review:

• Project Director;
• Project Manager;
• Technical Manager;
• Engineering Manager;
• Planning Manager;
• Construction Manager;
• QA/QC Manager;
• Commercial Manager;
• Civil, electrical, mechanical and safety departments.

As the matter concerns cables, the electrical department should be included in the distribution. The relevant disciplines should review the letter from their own perspective, including technical scope, programme impact, quality requirements, site records and commercial consequences.

4. Keep the Letter for the Record

A key handwritten instruction on the correspondence is “keep for record”. This is a significant project-control action, not merely an administrative instruction.

The letter is evidence that the client or consultant accepted that utility works had been carried out. It should therefore be retained within the project records and connected to the relevant variation, claim or commercial file.

In a future claim or valuation discussion, the contractor may need to demonstrate that:

• The utility-lowering activity occurred;
• The work was related to accommodating the new road level; and
• The client or consultant acknowledged that the work had been completed.

5. Identifying the Executed Scope

The internal notes identify that the acknowledgement of completed work must be followed by a clear explanation of the scope performed and the associated cost. The work items mentioned in the lecture are:

• Manual rock excavation by jackhammer;
• Temporary supports;
• Lifting and relaying; and
• Associated civil works.

These activities should be clearly described and supported by project records. The commercial team must then determine the value of the executed work in accordance with the applicable contract and project procedures.

6. The Commercial Gap in the Client's Reply

Although the reply confirms that the cables were lowered, it does not state how the contractor will recover the cost incurred. Confirmation of execution alone does not automatically resolve the valuation of a variation.

The contractor's next correspondence should therefore make the commercial position clear. It should explain that work was undertaken and identify the relevant executed activities. The contractor should then seek recognition of its entitlement for the cost of those works.

A practical follow-up should address:

1. The work completed on site;
2. The reason the work was necessary;
3. The scope of manual excavation, supports, lifting, relaying and civil works;
4. The substantiation available for the work performed; and
5. The contractor's request for valuation and payment.

7. Critical Risk: Work Started Without Formal Instruction

The lecture highlights a major contractual weakness: the contractor began executing the work before receiving a formal instruction.

This creates risk because the client could argue that no formal instruction was issued and that the contractor was therefore not entitled to additional payment. Even where the work was necessary and subsequently acknowledged as completed, the absence of prior written instruction can make recovery more difficult.

For this reason, contractors should generally avoid proceeding with potential variation work until they have received the required formal instruction or approval. Where urgent site circumstances require action, the contractor should create and preserve detailed contemporaneous records and notify the client or consultant promptly.

8. Key Learning Points

• A client or consultant letter confirming that work has been completed can be valuable evidence.
• All correspondence should be retained, referenced and distributed to the relevant project departments.
• Technical acknowledgement of work does not by itself confirm payment entitlement.
• The contractor must identify the actual executed scope and submit the commercial basis for recovery.
• Proceeding without formal instruction is a serious contractual and commercial risk.
• Document control, technical records and commercial follow-up must work together to support a variation or claim.