Construction Law/Lack of Progress

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QUESTION: Dear Mr. Mike,

We are using FIDIC 2005 RED BOOK MDB Harmonized Edition.

The Contractor submitted a detailed programme, however within 21 days the Engineer give notice to the Contractor in accordance with Sub-Clause 8.3 [Programme] stating to which it does not comply with the contract.

Anyway, here is the scenario, the Contractor submitted a delay analysis using Time Impact Analysis (TIA) technique by inserting or adding a group of activities (Fragnet or Sub-network) and these activities linked to excavation work (FS relationship) applying the same date to slab concreting as per original planned (e.g. March 20, 2012) without considering the actual finished date (June 25, 2012) which is 3 months late from its original finish date. Since the group of activities (Fragnet or Sub-network) including excavation work falls within the critical path, the consequences and effects of Contractor’s claim analysis shows the new project completion date as of 6 months late from its original completion date.

In what way and how we (Owner) can demonstrate and substantiate the “Lack of Progress” of the Contractor that can be used against them for the measurement of the extension of time if the following are:

1. The programme is not yet approved during the time when the Contractor submitted their notice of intention to claims within a specified time frame stated in the condition of the contract. Then later within 42 days the Contractor submitted a fully detailed claim including supporting particulars using the unapproved baseline programme?
2. Do we (Owner) have the right to reject the claim proving the above analysis?
3. Should the Engineer shall give notice whenever the Contractor showed some slow progress in their actual. This question is not related to Rate of Progress [Sub-Clause 8.6]. Correct me if I am wrong.

The owner’s intention to reject the said claims it is because the activity (e.g. excavation work) extending the new project completion date by 6 months. It is so obvious the delay and disruption is caused by the contractor due to the late actual finished of excavation work that drives the other activities resulting to the new completion date.

Best regards,

Aryan

ANSWER: Hi Aryan
You are in typical concurrency situation whereby the contractor alleges that the employer has caused delay and at the same time the contractor has also caused delay.
In the UK there are rules that apply to concurrency and these are explained on legal websites such as Atkinson Law.
The fact that the programme is not yet approved complicates the issue.
The problem with an Impacted as Planned analysis is that it is entirely theoretical and it could be that the non approved programme has been pre rigged to achieve an EoT result.
I would suggest in the first instance that you set aside the claim for the time being and give sound reasons why the programme has not been approved - provided of course that the contract period for deemed approval has not lapsed.
Even if an approved programme has obvious flaws you can require that they be adjusted - approval does not mean agreement.
When the contractor submits a programme that can be approved then test it with the delay fragnet to see what the entitlement is then.
You should not reject a claim without sound reason -or worse still ignore it - because you are in danger of setting time at large.
I hope that helps.
Best regards
Mike Testro

---------- FOLLOW-UP ----------

QUESTION: Dear Sir,

Thank you so much for your quick reply.

The reason why the Engineer did not accept the contractor's programme it is because under Sub-Clause 8.3(d) a supporting report which includes:

(ii) details showing the Contractor’s reasonable estimate of the number of each class of Contractor’s Personnel and of each type of Contractor’s Equipment, required on the Site for each major stage.

The Engineer's intention is to have a programme to be resource loaded in accordance with sub-clause 8.3 (d),(ii) above.

My question is, does the Engineer is right that this Sub-Clause 8.3 (d),(ii) is what they so-called resource loaded programme?

Many thanks.

Best regards,

Aryan

ANSWER: Hi Aryan
Yes the Engineer is right in that what is described is a resource loaded programme.
However there are two types of resource loaded programmes.
1. Passive where the resources are attached to the previously estimated task duration.
2. Modelled where the task duration is driven by the productivity of the leading resource.
The Engineer should insist on option 2 as the programming software has the facility to make the necessary calculations.
Best regards
Mike Testro

---------- FOLLOW-UP ----------

QUESTION: Dear Sir,

Thank you again for your quick reply.

I agree with you in regards to Sub-Clause 8.3(d),(ii) however, I am not aware and familiar of what Passive & Modelled are. If is it fine for you can you please elaborate further what does it mean or perhaps you have something in mind such website or white paper that can explain and cite an example in order for me to make things clear.

Once again, thank you so much.

Regards,

Aryan

Answer
Hi Aryan
I will try and give you a simple example based on a task for a block wall 1000 m2.
If a mason can lay 2 m2 per hour then he will take 500 hours to build the wall which in a 10 hour day would be completed in 50 days. That is resource modelling. If 5 masons were deployed then it would be done in 10 days.
Any software programme will perform this function and calculate the task duration automatically balancing output and gang size.
Passive resource loading is where a duration for the wall has been set at 15 days and 4 masons have been dropped onto the task with no back up calculation.
I hope that is clear.
Best regards
Mike Testro

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Mike Testro

Expertise

Anything related to extensions of time and delay analysis.

Experience

45 years in the Construction Industry 15 Years as a consultant delay analyst - I now hold myself to be expert in this field.

Organizations
Society of Construction Law Adjudication Society ex Planning Engineers Organisation

Publications
6 articles on the relevance of the India Contract Act 1872 and its relevance to modern construction in India. Waiting Publication

Education/Credentials
Associate Member of the Institue of Building

Past/Present Clients
Currently employed in India by Punj Lloyd as expert delay analyst. Engaged in ongoing arbitrations and EoT claims. Prior an Indepenent consultant in delay analysis.

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