Final Account Disputes: How to Protect Your Money

‍‌​​‌‌‌‌​​​‌​‌‌​‌​​‌​‌‌‌​​‌​​‌​‌‌‍By the time you argue the final account, all the mess from the job is in there: variations, delays, contra-charges, retentions, everything. The Construction Act payment rules still apply at this stage, and you can still use smash-and-grab adjudication if they miss notices – but the other side can now also hit back with a "true value" adjudication once they've paid.

This is general guidance only and is not legal advice. Final accounts are high-value and technical – always get proper legal/claims advice before you rely on this.

1. WHAT A FINAL ACCOUNT IS (AND WHY IT GETS UGLY)

A final account is the agreed statement of the total amount due under the contract when the job is basically done, including all changes to the original price.

It normally covers:

• Original contract sum.
• Agreed variations and provisional sums.
• Loss and expense / prolongation (if any).
• Adjustments for defects, damages, retention, and previous payments.

It gets nasty because:

• Everyone's under pressure to close books and protect margin.
• If you didn't keep on top of variations or notices during the job, you're trying to fix a year's worth of paperwork in one go.
• The numbers are bigger, so they fight harder.

2. THE CONSTRUCTION ACT STILL BITES AT FINAL ACCOUNT

Even at final account stage, the same payment machinery applies:

• There's a due date and a final date for payment for your final account application/certificate.
• The payer must serve a payment notice within 5 days of the due date, or your application/default notice can set the notified sum.
• If they want to pay less than that notified sum, they must serve a pay less notice on time, stating the reduced sum and the basis of calculation.

If they blow those deadlines:

• You can run a smash-and-grab adjudication on the final account application, just like on an interim – claiming the full notified sum because of notice failures, not because your value is perfect.
• They can later start a true value adjudication on the final account, but only after they've paid the smash-and-grab award.

So the Act is still your friend – but you've got to be sharper with your final application than you were with your interim ones.

3. HOW TO SET UP A STRONG FINAL ACCOUNT

Think of this as your last, best shot at making the numbers clear.

1. Build a clean final account pack

Include:

A one-page summary:

• Original contract sum.
• Total variations.
• Loss/expense.
• Adjustments (contra charges, LDs, etc.).
• Retention and what's left.
• Previous payments.
• Balance due.

Detailed schedules:

• Variations log with dates, instructions, values.
• Measured work vs drawings/BOQ.
• Delay/loss and expense schedule if you're claiming time/money.
• List of contra-charges you dispute and why.

2. Make your final application "notice-ready"

Treat your final account application like a statutory payment notice:

• Clear heading: "Final Account Application – Notified Sum if No Payment Notice is Issued".
• State the sum due and the basis of calculation in a way that would satisfy the Act if it became the default notice.
• Serve it exactly how and when the contract says – method, address, cut-off time.

If they don't serve a valid payment notice or pay less notice in time, that final application is what you'll hang a smash-and-grab on.

3. Don't sign away your rights by accident

Watch out for:

• "Final account" or "final statement" documents they send for you to sign "in full and final settlement"; once you sign, it can be very hard to reopen.
• Emails from your side saying "happy with this as final", when you're not – your own QS can box you in if they're too casual.

Only accept "final" if the number and wording match what you can live with.

4. SMASH-AND-GRAB vs TRUE VALUE AT FINAL ACCOUNT

At final account stage, the same split applies:

Smash-and-grab adjudication

You argue:

• Your final application (or default notice) was valid.
• They failed to serve a compliant payment/pay less notice in time.
• Therefore, under the Act, the notified sum (your figure) must be paid now.

The adjudicator focuses on:

• Notice timing and validity.
• Whether your application was a compliant payment notice/default notice.

If you win, they must pay the full notified sum (subject to minor adjustments) and you can enforce in the TCC if necessary.

True value adjudication

Either side can ask an adjudicator to decide the actual final account figure – going through valuation, variations, prolongation and deductions item by item.

After key Court of Appeal decisions, the current position is:

• A paying party can run a true value adjudication on a payment (including final) but usually only after paying what they owe under any earlier smash-and-grab decision.

So your playbook at final account can be:

1. Use a smash-and-grab to get cash in quickly if they miss notices.
2. Be ready for a possible true value adjudication afterwards and make sure your numbers stand up if the job gets re-valued.

5. PROTECTING YOUR POSITION WHEN THINGS TURN SOUR

Practical steps when the final account row kicks off:

Lock down your own records

• Save every instruction, drawing revision, email agreeing a variation, and your own measures.
• Don't rely on their QS's spreadsheets.

Respond to their "final account" quickly and in writing

• If their assessment is miles off, say clearly you do not accept it as final and set out your own figure and basis.
• That helps show there's a genuine "dispute" if you end up adjudicating later.

Don't give them free ammunition

• Avoid emotional emails. Assume everything will be in front of a judge or adjudicator one day.
• Keep communications factual: "we measured X, you measured Y, here's why we say X is right."

Know when to get a pro in early

• For serious sums, bring in a QS/claims consultant and a construction lawyer before you send a final application marked up as "smash-and-grab bait" – they'll tighten dates, notices and quantum.

This page is guidance only and does not constitute legal advice. Using it does not make us your legal adviser. Always get advice from a qualified construction lawyer or claims specialist on your specific final account.

What to do next

• Build a clean final account pack: one-page summary, detailed variation schedules, delay/loss claims, contra-charge disputes.
• Make your final application "notice-ready" · clear heading, sum due, basis of calculation · so it works as a default payment notice if they miss theirs.
• Do not sign any "full and final settlement" document until you are genuinely happy with the number and wording.
• If their assessment is miles off, respond in writing immediately saying you do not accept it as final and set out your own figure.
• For serious sums, bring in a QS or claims consultant and a construction lawyer before you send the final application.

Sources

• Housing Grants, Construction and Regeneration Act 1996 · payment notices, pay less notices, and adjudication rights apply at final account stage
• Scheme for Construction Contracts (England and Wales) Regulations 1998 · fills in gaps on final account payment timing
• Local Democracy, Economic Development and Construction Act 2009 · amendments to the notice regime

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