Work has been carried out and the money has not arrived. There are three quite different claims behind that sentence, and they are proved in three different ways. Identifying which one you have is the first step to being paid.
The work is finished, or far enough advanced to have cost real money, and the payment has not come. That single complaint conceals three distinct positions. The sum may have been certified and simply not paid. It may not have been certified at all, or certified at a figure you do not accept. Or the work may have been carried out with no agreed price to certify against. Each is a different claim, proved by different documents, and worth a different amount.
Certified and unpaid
Where the contract provides for payment against certificates, the certifier values the work properly executed, and the employer must pay the certified sum within the period the contract states.
A claim for a certified sum is a debt claim rather than a damages claim, and that is an advantage. The amount is fixed by the certificate, not by an argument about value, and the burden shifts to the employer to establish a right to withhold. Interest runs where the contract provides for it.
The employer cannot decline to pay because it is unhappy about something else on the project. Withholding requires either a right of set-off or deduction under the contract, exercised in the manner and within the time the contract prescribes, or a cross-claim it is prepared to plead. Deducting first and explaining later is itself a breach on most forms of contract.
Where the employer is a company that has stopped paying, the recovery route may extend beyond the contract, and the steps are set out in Recovering a Debt From a Cyprus Company That Will Not Pay.
Certified at the wrong figure, or not certified at all
Interim certificates are ordinarily provisional. They value what has been done to date, they are corrected in later certificates and in the final account, and, unless the contract says otherwise, they are not an acceptance that the work is free from defects.
If a valuation is too low, deal with it through the contract machinery and at the time. Ask the certifier for the build-up: the quantities allowed, the rates applied, the variations included and excluded, and the retention and deductions taken. Respond in writing, item by item, before the next certificate is issued. A contractor who accepts six under-valuations in silence and objects to the seventh has a harder case than the arithmetic deserves.
Where a certificate is not issued at all, the contract usually fixes a period within which it must be. A failure to certify within that period, or an employer's interference with the certifier's function, may itself be a breach and may open a route to claim the sum due without the certificate. Whether it does depends on how the contract is drafted, so this is a point to take advice on rather than to assume.
The final certificate is different. Some contracts give it conclusive effect on some or all matters after a stated period unless proceedings have been commenced. Check that clause before the period runs, because it can close down claims on both sides.
Retention
Retention is a percentage of each payment held back as security for completion and for the remedying of defects. The percentage, and the stages at which each part of it falls to be released, are whatever the contract says they are, so check the clause rather than assuming a standard pattern. Retention is the employer's security, not its money.
Record the retention held in each certificate, so that the total is not reconstructed years later from arithmetic, and diarise the release dates. Retention is most often lost not because it was refused but because nobody asked for it, the project moved on, and by the time anybody looked the contracting company had been wound up.
Payment where there was never an agreed price
The third position is the most litigated. Work is carried out under a letter of intent while the contract is still being negotiated, or beyond the scope of a contract that was overtaken, or under an arrangement that never became binding at all. There is no price to certify against.
The claim is then for a reasonable sum for the work actually done, in what is generally described as quantum meruit. The evidence that carries it is the same evidence that supports any valuation: records of labour, materials and plant, the drawings and specifications worked to, and any rates the parties had discussed, which remain good evidence of value even where they were never agreed as a contract price.
The claim is not a judicial invention. It is section 70 of the Contract Law, Cap. 149: where a person lawfully does something for another, or delivers anything to them, without intending to do so gratuitously, and the other enjoys the benefit of it, the latter is bound to compensate the former in respect of what was done, or to restore the thing delivered. Three elements have to be shown and each is answered by the same file. The act must be lawful. It must have been done for the other party, not for the doer's own account. And it must not have been intended as a gift, which is where the letter of intent, the request to start early and the tender correspondence do their work. Where those are present, the person who took the benefit has to pay for it whether or not a contract ever came into existence.
Two neighbouring sections settle arguments that arise in the same files. Section 69 gives a right of reimbursement to a person who has an interest in paying money that another is legally bound to pay and who pays it, which is the answer where a main contractor settles a supplier's or a subcontractor's liability to keep the site running. Section 72 requires a person to whom money has been paid, or anything delivered, by mistake or under coercion, to return it, which is the route to recovering an overpayment made against a certificate that turns out to have been wrong.
The same logic applies where a professional appointment is partly performed and then brought to an end. In ΜΑΡΙΟΣ ΚΥΡΙΑΚΟΥ κ.α. v. Α/ΦΟΙ Μ & Κ ΜΙΧΑΗΛ, Πολιτική Έφεση Αρ. 203/2015, 1 February 2024, architects had prepared the plans, obtained planning permission and carried out the supporting studies for a development that the owners then abandoned before the building permit application was made. Their fee had been agreed as a percentage of the final cost of a project that was never built. The District Court awarded them the whole agreed fee, on the footing that a claim resting on an agreement left no room for quantum meruit. The Court of Appeal disagreed, and did not dismiss the owners' appeal: it held that the evidence of the stage the work had reached, put at 50 to 60 per cent of the engagement, gave a basis on which a reasonable sum could be computed. It set the award aside and substituted €36,000 plus VAT for €45,875.20 plus VAT, exercising the power in section 25(3) of the Courts of Justice Law 14/1960 to decide the point itself rather than remit it, and left each side to bear its own costs of the appeal.
The lesson runs both ways. A professional or contractor asked to begin before terms are settled should record what has been agreed about payment if the project does not proceed, and an employer who abandons a project should expect to pay for what was done up to that point.
How long you have
Contract claims are generally subject to the six-year period under the Limitation of Actions Law 66(I)/2012, running from when the cause of action accrued. For a certified sum that will usually be the date payment fell due; for a claim for a reasonable sum it depends on the facts. Where the last payment was a while ago, check the dates before doing anything else.
What to send us
The contract or letter of intent, every certificate and valuation issued, the correspondence about the disputed items, your records of labour, materials and plant, and a statement of what has been paid and when.
Payment disputes sit within our construction practice. Where the dispute is really about whether work was an extra, see Variations Under a Cyprus Construction Contract. Where payment is being withheld because of alleged defects, see Building Defects in Cyprus: Legal Remedies.
Discuss your own situation with us
Questions we are asked
The work is done and we have not been paid. What kind of claim is it?
One of three, and they are proved in different ways and worth different amounts. The sum may have been certified and simply not paid, which is a debt claim. It may not have been certified at all, or certified at a figure you do not accept. Or the work may have been carried out with no agreed price to certify against, which is the most litigated of the three. Identifying which position you are in is the first step to being paid.
What is the advantage of a certified sum?
A claim for a certified sum is a debt claim rather than a damages claim. The amount is fixed by the certificate rather than by an argument about value, and the burden shifts to the employer to establish a right to withhold. Interest runs where the contract provides for it, and the employer cannot decline to pay because it is unhappy about something else on the project: withholding requires either a right of set off or deduction under the contract, exercised in the manner and within the time the contract prescribes, or a cross claim it is prepared to plead. Deducting first and explaining later is itself a breach on most forms of contract.
The valuation is too low. What should we do?
Deal with it through the contract machinery and at the time. Ask the certifier for the build up, the quantities allowed, the rates applied, the variations included and excluded, and the retention and deductions taken, then respond in writing item by item before the next certificate is issued. A contractor who accepts six under valuations in silence and objects to the seventh has a harder case than the arithmetic deserves. Interim certificates are ordinarily provisional and are corrected in later certificates and in the final account, but the final certificate is different: some contracts give it conclusive effect on some or all matters after a stated period unless proceedings have been commenced, so that clause should be checked before the period runs.
How is retention usually lost?
Not by refusal but by inattention. Retention is a percentage of each payment held back as security for completion and for the remedying of defects, and the percentage and the stages at which each part falls to be released are whatever the contract says, so the clause has to be read rather than assumed. It is the employer's security, not its money. Record the retention held in each certificate so that the total is not reconstructed years later from arithmetic, and diarise the release dates, because retention is most often lost when nobody asked for it, the project moved on, and by the time anybody looked the contracting company had been wound up.
What if there was never an agreed price?
Then the claim is for a reasonable sum for the work actually done, generally described as quantum meruit, and it arises where work is carried out under a letter of intent while the contract is still being negotiated, beyond the scope of a contract that was overtaken, or under an arrangement that never became binding. The evidence that carries it is the evidence that supports any valuation: records of labour, materials and plant, the drawings and specifications worked to, and any rates the parties had discussed, which remain good evidence of value even where they were never agreed as a contract price.
Does the same rule apply to a professional appointment cut short?
It does. In ΜΑΡΙΟΣ ΚΥΡΙΑΚΟΥ κ.α. v. Α/ΦΟΙ Μ & Κ ΜΙΧΑΗΛ, Civil Appeal 203/2015, decided on 1 February 2024, architects had prepared the plans, obtained planning permission and carried out the supporting studies for a development the owners then abandoned before the building permit application was made, their fee having been agreed as a percentage of the final cost of a project that was never built. The Supreme Court dismissed the owners' appeal and treated the architects as entitled to a reasonable sum for the part of their obligations they had actually performed, rather than to the agreed percentage fee, which was referable to complete performance.
Related Reading
This article is for general information only and does not constitute legal advice. Laws and their application can change, and individual circumstances differ. For advice on your own matter, contact Klitos Platis at klitos@kleanthousplatis.com or telephone +357 22 680 330.
Klitos Platis
Advocate, Partner
Kleanthous & Platis LLC, Nicosia · Revised 4 August 2026
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