Académique Documents
Professionnel Documents
Culture Documents
INFRASTRUCTURE PROJECTS
Presented by:
Stuart Cullen
BSc PgDip FCIArb
Senior Consultant Hill International
Kumar Arumugam
MBA, BEng (Hons) Electrical, PGDipArb, FCIArb, MRICS
Managing Consultant Hill International
Page 1
Page 2
INTRODUCTIONS
Your name
Page 5
Formality Contract
Employers requirements
Page 6
Page 7
Page 8
Page 9
Page 10
Page 11
Sydney Opera House original estimated cost to build the Opera House
was AUS $7m in 1957 and expected to be completed in five years
(1962).
The project was started in 1959 and the value escalated to AUS $102m
and was completed in 1973.
Not only did the budget over-run to 15 times the original estimate, but it
also took 14 years to complete.
The main factor which affected this project was insufficient planning
during the design stage.
This led to a series of errors during construction, which effectively
caused a domino effect. Hence, increasing the cost and pushing back
the completion date.
Page 12
2.
3.
The customer team does not match the provider team in terms of either skills or
The context, complexities and dependencies of the contract are not well understood
5.
6.
A focus on current arrangements rather than what is possible or the potential for
improvement
7.
A failure to monitor and manage retained risks (statutory, political and commercial).
[Source: Contract management guidelines Office of Government Commerce 2002 (available online at www.ogc.gov.uk)]
Page 13
Page 14
No. Of Cases
Rail
58
44.7
33
33.8
Road
167
20.4
[Source Cost Underestimation in Public Works Projects: Error or Lie? By Bent Flyvbjerg, Mette Skamris Holm, Sren Buhl
Journal of the American Planning Association, Vol. 68, No. 3, pp. 279-295Summer 2002]
Page 15
Civil Aviation
4,123.2
5,435.0
31.8 3
10 - 23
Coal
48
27,241.5
30,628.5
12.4 17
9 - 48
Fertilisers
5,317.4
5,317.4
0.0 3
1-8
Mines
4,091.5
4,401.8
7.6 1
30 - 30
Steel
15
41,398.4
68,455.6
65.4 4
17 - 36
Petrochemicals
5,460.6
5,460.6
0.0 0
Petroleum
75
161,799.3
169,936.2
5.0 37
2 - 120
Power
84
180,274.3
186,358.4
3.4 47
2 - 90
10
Railways
136
66,510.0
133,785.1
101.2 29
2 - 213
11
136
73,440.5
75,245.7
2.5 94
4 - 106
12
26
18,451.4
19,434.9
5.3 14
2 - 93
13
Telecommunications
41
20,026.0
20,650.7
3.1 21
4 - 72
14
Urban Development
52,921.2
68,412.4
29.3 2
12 - 15
15
Water Resources
542.9
1,187.0
118.6 1
60 - 60
No
Total
584
690,826.4
828,775.5
20.0
276
Page 16
Civil Aviation
Coal
48
Fertilisers
No
670.45
883.76
4,429.59
4,980.33
864.63
Mines
Steel
15
Petrochemicals
Petroleum
31.8 3
10 - 23
12.4 17
9 - 48
864.63
0.0 3
1-8
665.30
715.75
7.6 1
30 - 30
6,731.57
11,131.19
65.4 4
17 - 36
887.92
887.92
0.0 0
75
26,309.31
27,632.40
5.0 37
2 - 120
Power
84
29,313.43
30,302.73
3.4 47
2 - 90
10
Railways
136
10,814.83
21,754.07
101.2 29
2 - 213
11
136
11,941.76
12,235.29
2.5 94
4 - 106
12
26
3,000.28
3,160.20
5.3 14
2 - 93
13
Telecommunications
41
3,256.32
3,357.90
3.1 21
4 - 72
14
Urban Development
8,605.23
11,124.17
29.3 2
12 - 15
15
Water Resources
88.28
193.01
118.6 1
60 - 60
Total
584
112,331.5
134,762.7
20.0
276
Page 17
[Source: Study on the Quantification of Delay Factors in Construction Industry K. L. Ravisankar, Dr. S. AnandaKumar, V.
Krishnamoorthy (International Journal of Emerging Technology and Advanced Engineering Volume 4, Issue 1, January 2014)]
Page 18
2.
3.
4.
5.
6.
7.
8.
9.
OVERVIEW (3.00)
Page 20
Separable Portions.
Subcontracting.
Physical Conditions.
Variations.
Cost of Delay.
Continued..
Management Documents.
Insurances.
Practical Completion.
Page 22
DEFINITIONS (4.00)
Page 23
Thailand
Malaysia
New Zealand
Singapore
Page 25
Indonesia
Malaysia
Philippines
Page 26
[Source PWC - A Summary of South East Asian Infrastructure Spending: Outlook to 2025]
Page 27
[Source PWC - A Summary of South East Asian Infrastructure Spending: Outlook to 2025]
Page 28
[Source PWC - A Summary of South East Asian Infrastructure Spending: Outlook to 2025]
Page 29
Page 30
Page 31
Loose term
Provide information
Valuation of Variations.
Claims preparation.
Page 34
DOCUMENTS FORMING A
CONTRACT
Page 37
Notification (10.01)
Page 38
EXAMPLE
SEPARABLE PORTIONS
Page 40
EXAMPLE
SEPARABLE PORTIONS
Page 41
Provide Documentation specified by the Contract as a precondition of achievement of Practical Completion for
individual Separable Portions.
Page 42
Discussion
1. What are the key features of an entire contract?
2. What are the practical implications of an entire contract when
assessing whether or not a variation has occurred?
3. What are the disadvantages if Contract documents are broken up
and not controlled?
4. What action should be taken if ambiguities are discovered within
a Contract document?
5. Apart from order of precedence what other criteria can be
applied when determining precedence?
6. What are some of the procedural actions that must be taken with
regard to Separable Portions?
Page 43
Page 44
Time periods in the Conditions of Contract: Sub-Clauses 1.1.1.3, 1.13.1, 4.2, 8.1,
8.2, 8.3, 8.4, 8.7, 9, 10.1, 11, 11.3, 11.9, 11.10, 14.1, 14.2, 14.4, 20.2.
Progress Requirements: Sub-Clauses 2.1, 2.5, 3.5, 8.1, 8.3, 8.4, 8.6, 14.6, 20.1, 20.4.
Workmanship procedures: Sub-Clauses 2.5, 7.1, 7.3, 7.4, 7.5, 7.6, 10.2.
Procedures at Completion of Works: Sub-Clauses 9, 10.1, 11.4.
Procedures during Defects Notification Period: Sub-Clauses 2.5, 10.1, 11.1, 11.3,
11.6, 11.8, 11.9,
Procedures for advance payment: Sub-Clauses 14.2, 14.3, 14.7, 14.8, 16.1, 16.2.
Payment procedures: Sub-Clauses 4.2, 14.3, 14.6, 14.7, 14.8, 16.1, 16.2.
Procedures for Payment at Completion of Works: Sub-Clauses 8.2, 10.1, 14.6,
14.10.
Procedures for final payment: Sub-Clauses 14.7, 14.9, 14.11, 14.12, 14.13.
Claims by the Contractor: Sub-Clauses 1.3, 1.9, 3.5, 8.3, 8.4,
Claims by the Employer: Sub-Clauses 2.5, 3.5, 14.14, 20.4.
Procedures for disputes: Sub-Clauses 20.4, 20.5, 20.6.
[Source: FIDIC users' guide: A practical guide to the 1999 Red and Yellow Books]
Page 45
EXAMPLE
Page 47
EXAMPLE
Page 48
EXAMPLE
Page 49
EXAMPLE
Page 50
EXAMPLE
Project:
Event
Variation,
arising
from issue
of a
drawing or
document
by the
Principal.
xxx
Reference to drawing or
document containing the
change.
Date that drawing or
document issued.
Reference to equivalent
Contract drawing or
document.
Details of the change.
Nature of change, add omit,
character, lines/levels,
manner of performance.
Any other facts.
Legal or contractual basis
of the claim.
Calculation or estimate of
monetary amount involved.
Comments
Page 51
EXAMPLE
Example of a
Flow Chart
(12.04)
Physical
condition
encountered
Contractor
immediately
issues notice
to Principal
Principal
directs
work to be
undertaken
MONEY
Within
specified time
TIME
Within
specified
time
Within
specified
time
Contractor
issues a notice
of Delay (if
the work is
delayed)
Contractor issues
notice of Extension
of Time (if
Completion is or
will be delayed)
At specified
intervals
Page 52
Page 53
EXAMPLE
Contract maximum
notice period
Immediate
Immediate
Immediate
Immediate
x days
Physical condition
Physical condition
Physical condition
Confirm in writing
Potential Variation
Contract
clause #
xxx
xxx
xxx
xxx
xxx
x days
Potential Variation
xxx
x days
Potential Variation
xxx
x days
x days
x days
x days
xxx
xxx
xxx
xxx
Page 54
Page 55
EXAMPLE
Page 57
EXAMPLE
2 wks
Stiffeners
to beam B1
Date
requested
Date
required
Date
received
8/5/13
15/5/13
14/5/13
16/5/13
23/5/13
Not yet
received
Transmittal
Reference
Comments
RFI # xx
Reo Schedule
xxx dated
14/5/13
Email dated
16/5/13
Received by required
date
Fabricate off site.
At status date, details
not received by
required date.
Dimensions Start
on grid A-1 formwork to
slab level 1.
22/5/13
5/6/13
Not yet
received
RFI # xx
Page 58
Page 59
EXAMPLE
Page 60
Discussion
1. What could a Contracts Administrator do to understand and
educate others with regard to contractual interrelationships
between events and communication of those events to the
Principal?
2. What are the advantages of involving front line supervisors in the
Notification process?
3. What purpose would an Information Transmittal Register serve?
4. What is the most important feature of a Request For
Information?
Page 61
A direction from Principal can trigger the need for a formal notice
(14.01)
[FIDIC 20.1]
Page 63
SIA 2011
Time
23.(2)
Architect
Timing
within 28 days of
any event
Bars
condition precedent
to notify
Delay
Events
23.(1)(a) to (q)
Response
POSSCOC 2008
Time
14.3
Superintending
Officer
within 60 days of the
occurrence of such
event
conditions precedent
to notify & give
further details
REDAS 2010
Claims (time)
16.2.1
Employer's
Representative
28 days from the
date of the event
FIDIC 1999
Claims (time)
20.1
Engineer
condition precedent
to notify & give full
detailed particulars
Failure to notify no
entitlement
14.2(a) to (q)
16.1.1 to 16.1.4
(not stated)
within a reasonable
time
In 28 days an in
principle decision on
entitlement On
written request
In 60 days an in
principle decision on
entitlement
(not stated)
Page 64
Bars
Delay
Events
Response
PAM 2006
Time
23.(1)a
Architect
CIDB 2000
Time
24.2(a)
Superintending
Officer
30 days of the
occurrence of such
event
FIDIC 1999
Time & Cost
20.1
Engineer
Failure to notify no
entitlement
(1.9), (2.1), (4.12),
(4.24), (7.4), (8.9),
(16.1), (13.7), (17.3),
(19.4)
(not stated)
condition precedent
to notify
23.8(a) to (x)
(not stated)
(not stated)
43.1(a) to (j)
24.1(a) to (q)
within 6 weeks of
having sufficient
particulars
so soon as
he is able to
estimate the length
of the delay
(not stated)
(not stated)
In 30 days an in
principle decision on
entitlement
Page 65
EXAMPLE
Probability of a
requirement to Notify
within a prescribed
number of days
YES
Probability of a strict
Bar if prescribed
requirements are not
complied with
NO
Immediately
YES
YES
YES - if a claim made
under Claims.
NO - if Extension of
Time has been granted.
YES
YES
YES
YES - if a claim made
under Claims.
NO - if Extension of
Time has been granted.
YES
YES
Claims.
Disputes. Principals request for the Contractor
to provide further particulars.
YES
YES
YES
YES
Page 66
NOTICES
Page 67
Page 68
Page 69
EXAMPLE
EXAMPLE
Does the Notice do the
job?.
To The Employer
Where is level 3?
Page 70
EXAMPLE
EXAMPLE
Our Ref: Notification/STBLD/005
Dear Sir
15 October 2013
Notice of delay and disruption
ST Building - Installation of compressor skid
We refer to discussions on site on the 14 October 2013 (ref: Cunningham, Smith) regarding
the remedial works (floor strengthening) currently being undertaken by your civil contractor
(name) within the Steam Turbine Building, third floor (+11m level, adjacent to grid 11/ S1).
The remedial works are preventing Contractor Ltd from installing the compressor skid in
accordance with the planned schedule of work (ref programme xxx), and will delay the first
fire date currently scheduled for the 12 November 2013.
We are unable to confirm the extent of the delay and disruption at this time and seek your
urgent attention to this matter. Please advise when access for mechanical installation will
be available.
We will advise the impact of this delay as soon as the full details are known and hereby
give notice of our intention to make a claim for additional payment and time in accordance
with clause xx of the general conditions of contract.
Page 71
EXAMPLE
NOTICES
Signed by an authorised
signatory or a registered
delegate
Page 72
NOTICES
Make sure each letter and notice will stand on its own merit to
protect during the project and at the end, when claims may well
prevail.
Always be polite and state only the facts, do not get emotional
or go off on a tangent by stating irrelevant facts. Keep to the
point.
Page 73
EXAMPLE
NOTICES
Page 74
NOTICES
Page 75
NOTICES
Carry out tests.
Carry out pre-commissioning and commissioning.
Pre-notice of Practical Completion.
Pre-Notice of Final Completion.
Page 76
EXAMPLE
Page 77
adjust budgets.
Page 78
Discussion
1. What can be the consequences of failing to issue a formal Notice
in relation to prescribed events?
2. What can be the benefits if Notice requirements are complied
with?
Page 79
Page 81
EXAMPLE
Request written
instructions
Or
confirm verbal
instructions
Page 82
RECORD
Types of reporting
Diaries
Daily Reports - site
Progress Photographs
Minutes of meeting
Notes of Conversations
Labour and Plant
returns
Schedules
Progress Reports
Employer
Sub-contractor
Supplier
Page 83
EXAMPLE
RECORD, RECORD
The Special Comments section
of the daily report is an excellent
vehicle to record significant events
as they occur. There is no
substitute for contemporaneous
documentation.
Special Comments may be:
Project N a me:
________________________
Employer:
Area of Work:
Shift:
Report N o.:
Da te:
Wea ther:
.
Pa ge:
Description of
work planned
today
Problems/problem resolution.
Extreme weather and affected work.
Interferences.
Delays.
Instructions to Contractor by Employer or Engineer. If
instructions are not followed, state the specific reason.
Instructions given to sub-contractors.
..
of
Description of
work performed
today
Specia l Comments:*
DAILY REPORT
SPECIAL
COMMENTS
Reported by:
Da te
Reviewed by:
Da te
x
x
Page 84
EXAMPLE
Photographer
Reference number
Programme activity
TIME: 13:27
PHOTO BY: T SITE ENGINEER.
REF NUMBER: KOM/PETROL STATION/005.
PROGRAMME REF: PET-004.
DETAILS: Underground concrete pit to house petrol and diesel tanks
completed up to cover level. Ready to accept tank installation.
Note Surrounding road and pavement areas still shows no progress.
Services trenches to petrol pump station outstanding.
Page 85
Discussion
1.
2.
3.
4.
5.
Page 86
TOOLS
The Contract document is the most important item in the toolbox
of the Contract Administrator.
Page 87
BE PREPARED
Review the Contract by all contract administration Staff
Prepare a Contract Execution Plan
Page 89
Page 90
Start
Construction
Decreasing
Influence
Minimum
Influence
Max
Change Management Influence
Min
Engineering
Prelim. Design
and
Estimating and
Estimating
Procurement
STAGE 1
Assessment
Project Engineering
Procurement and
Cost Analysis
STAGE 2
Solution
Construction
and
Cost Analysis
STAGE 3
Implementation
Page 91
SUBCONTRACTING (17.00)
Two basic models for a Contractor to source its
productive resources
1. In-house.
2. Subcontract.
Page 92
SUBCONTRACTING (17.00)
In-house (17.01)
Page 93
SUBCONTRACTING (In-house)
Disadvantages
Advantages
SUBCONTRACTING (17.00)
Subcontract (17.02)
Page 95
SUBCONTRACTING (Out)
Disadvantages
Advantages
Page 96
SUBCONTRACTING (Out)
Disparity between Tender and Subcontract prices Subcontractors are either unwilling or unable to perform the work
at the tendered prices or open for acceptance expired(17.02.01)
Page 97
Discussion
1. What are some advantages of in-house productive resources?
2. What are some of the disadvantages of in-house productive
resources?
3. What is the commercial risk to a Contractor between the time of
receiving prices from Subcontractors at the time of tender and at
actual appointment?
4. What is the price risk to a Contractor when valuing a variation
carried out by a Subcontractor incorporated in a variation claim to
the Principal?
5. What should be avoided when writing Subcontracts?
6. What is the commercial risk if a subcontractor causes delay to
the overall project?
Page 98
Page 99
PHYSICAL CONDITIONS
[FIDIC 4.12]
If the Contractor encounters adverse physical conditions which he
considers to have been Unforeseeable, the Contractor shall give
notice to the Engineer as soon as practicable.
This notice shall describe the physical conditions, so that they can
be inspected by the Engineer, and shall set out the reasons why the
Contractor considers them to be Unforeseeable.
("Unforeseeable" means not reasonably foreseeable by an
experienced contractor by the date for submission of the Tender.)
Page 100
Page 101
PHYSICAL CONDITIONS
POSSCOC 2008
REDAS 2010
FIDIC 1999
Title
Adverse Physical
Conditions
Site Conditions
(deemed to have
satisfied himself)
Unforeseeable
Physical
Conditions
Claim
Clause
Notify
(not stated)
(not stated)
(not stated)
(not stated)
2.7.1.1
(not stated)
Timing
(not stated)
(not stated)
Bars
(not stated)
(not stated)
notice soon as
practicable
Yes, subject to
20.1
Yes
(not stated)
(not stated)
By determination
(not stated)
Delay
Events
Response (not stated)
(not stated)
Page 102
Discussion
1. What action must a Contractor take upon being aware of
changed physical conditions, and when?
2. What action can a Principal take upon being made aware of
changed physical conditions?
Page 103
VARIATIONS (19.00)
Addition, increase, decrease
Additional work.
Increase the quantity of work.
Decrease the quantity of work.
Omission or deletion.
Remove work (usually replace with something else).
Delete work altogether.
Change the character.
Eg - Change a solid steel member to a lattice configuration
= Less tonnage but more labour
Page 104
Definitions (19.01)
Change the quality.
Eg - Change from 304 grade SS to 316 grade SS.
Change lines, levels, positions or dimensions.
Can result from design changes manifested in drawing revisions. Usually
results in a change of quantity.
Change in the manner in which the work is carried out.
Using different equipment.
Using different techniques.
Eg - Transfer work from workshop to site.
Page 105
Definitions (19.01)
Page 106
Page 107
Page 108
Page 109
Process (19.04.01)
Principal proposes variation and requests a quotation
Contractor responds with quote, effects on timing, or other effects
Valuation (19.04.02)
By agreement of the price submitted by the Contractor.
Based on a schedule of rates and prices included in the Contract.
Based on reasonable rates and prices.
Daywork - valued based on recorded labour time, materials and
plant. A Daywork valuation will usually only apply if the Principal
has given prior approval of that method.
Minutes of Meetings
Page 111
time impact
Page 112
Discussion
1. Apart from a Variation raised by the Principal, by what other
means can a Variation arise?
2. Apart from a Variation raised by the Principal, what immediate
action must a Contract Administrator take when discovering a
potential Variation?
3. By what means can a Contract Administrator discover whether a
potential Variation has arisen?
4. What are the disadvantages of a Contract Administrator failing to
discover a potential Variation at the earliest opportunity?
Page 115
CONTRACT PROGRAMME
AND CONSTRUCTION PROGRAMMES (20.00)
Baseline activities.
Updates of baseline activities.
Critical path(s).
Format (usually time scaled network).
Predecessor and successor links and logic.
Page 116
CONTRACT PROGRAMME
AND CONSTRUCTION PROGRAMMES (20.00)
(Continued) Features of a Construction programme
Float.
CONTRACT PROGRAMME
AND CONSTRUCTION PROGRAMMES (20.00)
A Delay may not result in Extension of Time but could still involve
additional cost (21.04)
Delay (21.06)
EXAMPLE
Example
of a
Notice
of Delay
Page 122
Effect of Extension of Time Sets new dates for completion and relieves
Page 123
Criticality (21.08.05)
Page 124
EXAMPLE
Page 125
2-5 days
Notice of Delay
14 days
EOT Claim
Every 7 days
Further EOT Claims
Page 126
Page 128
EXAMPLE
Description
of Delay
Activity
delayed
Aware of
delay on
Date of
Delay
notice
Cl xxx
Date of
further
Delay
notice
Cl xxx
Start of
Delay
Finish
Number
of Delay of days
Delay
Date of
EOT claim
Cl xxx
Page 129
EXAMPLE
Contd,
Date of
further
EOT claim
Cl xxx
Critical path
EOT days
activity(s) effected claimed
Adjusted
completion
date claimed
EOT days
granted
Adjusted
completion
date granted
Comments
Page 130
Discussion
1. What is the difference between a Contract Programme and a
Construction Programme?
2. Under what circumstances can the status of a Construction
Programme change?
3. What is a typical contractual requirement for inclusions in an
updated Construction Programme to be submitted to the
Principal by a Contractor?
4. What is the significant difference between Delay and Extension
of Time?
Page 131
Discussion
5. What actions must a Contract Administrator take upon the
discovery of a Delay?
6. What are the disadvantages of not taking appropriate action?
7. What is the link between Delay and Extension of Time?
8. What actions must a Contract Administrator take if a claim for
Extension of Time is made?
9. What are the implications of concurrent delay?
10. What contractual process is involved when a Principal directs
compression?
Page 132
Page 134
Page 135
This method can be more complex than the pre-agreed unit rate
method above, for the reason that the cost per resource could
vary during the currency of a particular Delay.
Page 136
Page 137
Phase 1
Phase 1
Phase 2
Phase 2
Phase 2
Equivalent
month
Month 1
Month 2
Month 3
Month 4
Month 5
Rate per
working
day
$1,500
$1,500
$2,000
$2,000
$2,000
Phase
Month
1
2
3
1
2
2
2
3
4
Delay
(working
days)
5
2
10
Delay cost
$1,500
$2,000
$2,000
$7,500
$4,000
$20,000
Page 138
Staff member 1
Staff member 2
Staff member 3
Offices (hire)
Ablutions (hire)
Canteen (hire)
Stores (hire)
Plant item 1
Plant item 2
Plant item 3
Rate per
working
day
Phase 1
$825
$550
$400
$55
$30
$45
$30
$275
$85
$45
Rate per
working
day
Phase 2
$850
$575
$425
$60
$35
$50
$35
$300
$90
$50
Staff member 1
Staff member 2
Staff member 3
Offices (hire)
Ablutions (hire)
Canteen (hire)
Stores (hire)
Plant item 1
Plant item 2
Plant item 3
Total cost
Number of
working days
delay
5
5
N/A
5
5
5
5
5
5
N/A
Rate per
working day
Phase 1
$825
$550
$400
$55
$30
$45
$30
$275
$85
$45
Total cost
of delay
$4,125
$2,750
N/A
$275
$150
$225
$150
$1,375
$425
N/A
$9,475
Calculations for Delays 2 and 3 similar applying resources and rates applicable to the particular phase.
Page 140
Page 141
EXAMPLE
Resource
Staff member 1
Month 1
$15,000
Staff member 2
Month 2
$15,000
Month 3
$15,000
Month 4
$15,000
Month 5
$15,000
$10,000
$10,000
$10,000
$10,000
$7,000
$7,000
$7,000
Staff member 3
Offices (hire)
$1,000
$1,000
$1,000
$1,000
$1,000
Ablutions (hire)
$500
$500
$500
$500
$500
Canteen (hire)
$750
$750
$750
$750
$750
Stores (hire)
$500
$500
$500
$500
$500
Plant item 1
$5,000
$5,000
$5,000
$5,000
$5,000
$1,500
$1,500
$1,500
$1,500
$750
$750
Plant item 2
Plant item 3
Total cost per
month
Working
days/month
Average rate per
day
Delay #
Delay (working
days)
Delay Costs
$22,750
$34,250
$41,250
$42,000
$42,000
17
19
21
17
22
$1,338.23
$1,802.63
$1,964.28
$2,470.58
$1,909.09
#1
5
#2
2
#3
10
$9,013.15
$3,928.56
$24,705.80
Page 142
Discussion
1. What causes of Delay may entitle a Contractor to payment of
extra cost?
2. Under what circumstances may cost of Delay be paid where the
Delay did not cause Extension of Time?
3. What methods of Delay cost calculation may be available?
4. What is an essential consideration when calculating actual
Delay costs?
5. At what point in the progress of the work should Delay costs be
calculated?
6. Are there circumstances where adjustments should be made to
Delay costs?
7. Why is correct counting of days important?
Page 144
Page 145
Page 146
Page 147
EXAMPLE
Project:
Name.
Supervisor.
Date.
Activity
Erect columns C1 and
C2 and beam B1.
Stopped work.
Start time
7.00am
Finish
time
9.00am
9.00am
9.45am
10.30am
Transfer crew
11.00am
10.30am
Details
Hrs
2.00
Bolt holes at one end of beam did not line up with fin
plate on column.
Wrote Non Conformance Report.
Requested instruction.
Verbal instruction from xxx to cut off and replace
column C1 fin plate with correct holes.
2 riggers (names)
2 T/As (names)
1 crane driver (name)
Two elevated work platforms plus 50Tonne mobile
crane all on standby, before instruction received.
Same crew as above used to drop beam B1 and drop
Column C1.
Work cutting off fin plate, fabricating new fin plate with
correct holes and welding on to column carried out by
separate crew.
Transferred crew to work on column C3 and beam B2.
0.75
0.75
0.5
Page 149
This method deducts budget man hours from actual man hours
Page 150
Page 151
Page 152
By way of illustration .
The story of events, their cause and effect
Page 153
holding it tightly to insure a slow descent of the 500 lbs of bricks. You
will note on the accident reporting form that my weight is 135 lbs.
[setting the background to the claim]
In the vicinity of the third floor, I met the barrel which was now
proceeding downward at an equally impressive speed. [cause]
Slowed only slightly, I continued my rapid ascent, not stopping until the
fingers of my right hand were two knuckles deep into the pulley. [effect]
I began a rapid descent down the side of the building. [cause]
In the vicinity of the third floor, I met the barrel coming up. This
accounts for the two fractured ankles, broken tooth and severe
lacerations of my legs and lower body. [effect]
I again lost my composure and presence of mind and let go of the rope.
[cause ]
Page 154
Method 1 is the least likely to build in double dips for the reason
that the records should be quarantined and confined to the
disrupted event
Page 155
Page 156
Discussion
1. What contractual action must a Contract Administrator take when
circumstances that may give rise to a claim for loss of productivity
occur?
2. What administrative systems should be established and
maintained by a Contract Administrator.
3. Identify methods of calculation of loss of productivity.
4. What are advantages and disadvantages of each method?
5. Why is it an advantage to establish cause and effect?
Page 163
EXAMPLE
PAYMENT CLAIMS
Contract
Sum
Item Description
1
2
3
4
5
6
7
8
9
10
Claimed
Amount
11
12
13
14
15
16
Variations
Materials, plant and goods delivered
Unused Materials or Goods Not Delivered to Site
*Fluctuations
*Entitlements
Less Sums withheld / deductible under terms of Contract
Total Value
Page 164
as Variations. (24.03.03)
Page 165
Page 166
EXAMPLE
Page 168
EXAMPLE
Page 169
Discussion
1. In addition to monetary calculations, what must usually
accompany a Progress Claim?
2. What is the usual vehicle for claiming actual payment of
Variations and other Claims?
3. What event triggers submission of a Final Payment Claim?
4. What are significant required inclusions in a Final Payment
Claim?
5. Why is it important to check worked examples and base dates for
Rise and Fall formulae?
Page 170
Page 171
Discussion
1. What action should a Contract Administrator take regarding the
scope of supply?
2. What action should a Contract Administrator take regarding
actual supply?
Page 172
Page 174
INSURANCES (29.00)
Page 175
INSURANCES (INCOTERMS)
Page 176
PERFORMANCE UNDERTAKINGS,
GUARANTEES AND WARRANTIES (30.00)
Page 177
PERFORMANCE UNDERTAKINGS,
GUARANTEES AND WARRANTIES (30.00)
EXAMPLE
WARRANTIES
Defects Liability Period shall mean the defects liability period
named in the Appendix to the Form of Tender calculated from the
date of substantial completion of the whole of the Work.if any part
of the Works or Section or subsystems or components of that part (of
the Works or Section) has been replaced, renewed or repaired the
defects liability period in respect of that part or subsystems or
components of that part shall start from the date such replacement,
renewal or repair has been completed to the satisfaction of the
Engineer.
AVOID EVERGREEN / ROLLING DLP
Page 179
Pre-conditions (31.01.02)
Tests.
Pre-commissioning.
Commissioning.
Acceptance tests.
Page 180
Discussion
1. What action should a Contract Administrator take in the lead up
to Practical Completion?
Page 183
Ethics (32.00)
Act ethically
Page 184
Page 185
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