Loss and expense is the additional cost incurred by a contractor because the regular progress of the works has been delayed or disrupted by matters for which the client is responsible under the contract.
The term comes from JCT contracts, which refer to ‘loss and/or expense’ and set out the relevant matters and the procedure for claiming. It is separate from the value of variations and from extensions of time: an extension of time relieves the contractor from liquidated damages but does not by itself entitle it to money. Typical heads of claim include extended site overheads and preliminaries, disruption and loss of productivity, head office overheads and finance charges. Under NEC4 there is no separate loss and expense mechanism; the financial effect of delay and disruption is assessed as part of the compensation event, based on Defined Cost plus the Fee.
For the QS, contemporaneous records are essential, and the contractor must normally give notice promptly to preserve its entitlement.
Related terms: Extension of Time, Prolongation, Disruption, Compensation Event.
