Construction Law/Extension of Time and Contractor's Claim for reimbursement of Cost
The contract is a Fidic RED book.
The Contractor claimed for an extension of time, and the Engineer determined to grant a number N1 of days as a consequence of 'Delayed Drawings or Instruction' (Sc. 1.9) and a number N2 of days as a consequence of a Suspension (Sc. 16.1 and 14.7). Total extension of time N1 + N2 = N days.
The Contractor did not objected.
The Contractor notified in due time separate claims for additional payment, as he incurred in extra cost, for the N days during which he was obliged to stay on site.
The question is about the procedure to calculate these costs;
Please note that in the Contract there are no items for 'mobilisation' and/or 'running costs', 'General items', 'Preliminaries' and the like; only the works in BoQ are priced.
The Contractor proposes to derive from the Contract Price an average daily production, and from this one as a fixed percentage a 'daily fee' to account for overheads both on site and at the main office, to which a percentage for profit is added. Thus the additional payment is calculated as 'Daily fee' x N;
The Employer refers to the definition of 'Cost' at 220.127.116.11 : '... all expenditure reasonably incurred by the Contractor ...' and to some literature that states that: 'if the contract refers to 'cost' this should usually be 'actual costs incurred by the Contractor' and not the estimated cost derived from General items ...; the reference to the Fidic 18.104.22.168 definition is clear, and the conclusion is that the claimant must demonstrate his costs by reference to the resources deployed - including time sheets, daily reports and contemporary records in general (see Sc. 20.1), and invoices to substantiate the 'actual cost' of the prolongation.
The Engineer would like to follow the Contractor's view for the N1 days (late instruction) and the Employer's view for the N2 days (suspension).
question 1 is who is right, or closer to the right answer ?;
question 2: is there a 'diffused practice' to waive from the requirement to pile up all the invoices, the time sheets, records and the like, and, with limited or any reference to documents, to evaluate on the basis of the 'experience of the Engineer' the 'expenditure reasonably incurred' ?
Thank you very much for your patience and attention. Alfonso
The burden of proof is on the contractor.
Subclause 8.4 and 20.1 is relevant.
I am sure you read what is written on those subclauses.
The contractor needs to provide records and evidences or proof on how he reach the Cost being claimed due to delays caused by Employer.
There is no magic formula for calculating those Cost.
The contractor may refer to any other procedures written on the contract.
If time sheets, records, invoices etc etc will help substantiate the Cost claimed by contractor ( incurred or to be incur) , then those docs must be provided.
Hope this helps.