Delay Expert practical tips for making delay claims

Transcription

1 Octavian Dan

2 Delay Expert practical tips for making delay claims Identification of clauses in the FIDIC Contract useful for consideration when making delay claims: FIDIC 2017 edition a short summary of changes to specific clauses which are useful for consideration when making delay claims Recommendations regarding the use of the project programme for making delay claims: Typical delay scenarios principles Principles for setting up the delay analysis programme Delay analysis choices and methodology

3 FIDIC 2017 edition a short summary of changes to specific clauses which are useful for consideration when making delay claims

4 FIDIC Modifications to clauses related to delay claims Advance Warning (Cl.8.4) - Required to be issued by each Party to advise of known or probably future events affecting performance, price or delay. (but no apparent consequences for failure to comply). Notices (Cl.1.3) - All Notices must be in writing and specifically identified as a Notice (without the need to refer to the specific clause under which it is issued). - Nothing stated in the Progress Reports (Cl.4.20) or in the Programmes (Cl.8.3) can constitute a Notice unless the matter is specifically issued under Cl.1.3 Claims for Payment and/or EOT (Cl.20.2) - The provision requiring notification of the claim within 28 days is maintained; however, the Engineer/other party must give Notice within 14 days if it considers that the submission is out of time (otherwise the claim is deemed valid). - Later notifications are possible, if a party considers that there are justifying circumstances for the out of time submission (Cl ). Justification and supporting evidence is to be provided with the Fully detailed Claim (Cl ) within 84 days (or other period agreed) of being aware (or should have been aware) of the event or circumstance.

5 FIDIC Modifications to clauses related to delay claims Programme (Cl.8.3) - Details of programme clause expanded to include requirement for additional details in each programme: logic links, earliest and latest start and finish dates, float, critical path(s) - Deeming provisions regarding acceptance in relation to the initial programme, the revised programmes (and also the detailed test programme now required under Cl.9.1), failure of Engineer to give Notice of non-compliance with the Contract, inconsistency with actual progress or the Contractor s obligations (within 21 days, respectively 14 days) is deemed to be Notice of No-Objection and the detailed programme prepared by the Contractor will become the Programme. - Programming software can be stated in the Specifications or specified by the Engineer. - Programme submission at least one paper copy and one electronic copy for each programme submitted

6 FIDIC Modifications to clauses related to delay claims Entitlement to EOT - extended to additional items: - Access Route (Cl.4.15) relief grated for non-suitability/ non-availability of access route as a result of changes by third party which occurred after the Base Date. - Delays by private utility entities (Cl.8.5) added to delays caused by public authorities. - Delays generated by Employer- Supplied Materials (Cl.8.5) added to entitlement due to Unforeseeable shortages in the availability of personnel or Goods. - Delays generated by Permits (Cl.13.6) extended to changes in law to permits to be obtained by Employer or changes in requirements for the permits to be obtained by the Contractor.

7 FIDIC Modifications to clauses related to delay claims Clarifications to matters related to delay: - Adverse Climatic Conditions (Cl.8.5) relief grated/ limited to adverse climatic conditions affecting only the Site and which are Unforeseeable having regard to data provided by Employer or published in the Country for the specific location of the Site. - Concurrent Delay (Cl.8.5) new requirement from the Parties to adopt and apply rules and procedures which are to be stated in the Special Provisions. If the rules and procedures dealing with concurrency are not stated, the EOT entitlement is assessed as appropriate taking due regard to all relevant circumstances. [North Midland Building Ltd v Cyden Homes Lts [2017] EWHC 2414(TCC) confirmed that parties can deal with the risk of concurrent delay through contractual wording. Judgement: the contractual wording added was a clear agreement dealing with the proper approach to consideration of the appropriate extension of time in situations of concurrent delay, when one cause would otherwise entitle the contractor to such an extension (absent the concurrent event) but the other cause would not. The contractor is not entitled to an extension of time in that situation.

8 Concurrent Delays

9 Concurrency - principles Three commonly recognised approaches for dealing with the time aspects of concurrency: The first-in-line The dominant cause approach The apportionment approach The choice of approach will depend on the circumstances: The contract conditions The prevailing case law The context, the pragmatism and common sense

10 Concurrency - principles Scenario

11 Concurrency - principles First-In-Line (Scenario 1)

12 Concurrency - principles Dominant Cause (Scenario 2)

13 Concurrency - principles Apportionment (Scenario 3)

14 Typical delay scenarios principles

15 Typical delay scenarios principles EVENT 1 NO DELAY TO COMPLETION

16 Typical delay scenarios principles EVENT 1 CRITICAL PATH UNCHANGED

17 Typical delay scenarios principles EVENT 2 - NO DELAY TO COMPLETION, CRITICAL PATH UNCHANGED

18 Typical delay scenarios principles EVENT 3 DELAY TO START OF TASK 3

19 Typical delay scenarios principles EVENT 3 - NO DELAY TO COMPLETION, CRITICAL PATH UNCHANGED

20 Typical delay scenarios principles EVENT 4 CASCADING EFFECT TO TASK 3 AND TASK 4

21 Typical delay scenarios principles EVENT 4 - CRITICAL DELAY TO COMPLETION WITH CHANGE OF CRITICAL PATH

22 Setting up the delay analysis programme principles

23 Setting up the delay analysis programme 10 principles Scope: cover the entire Project scope (all phases and all disciplines). Milestones: Contractual Milestones (commercial and technical) and Key Project Milestones (main interfaces) placed at the top of the programme. Baseline: The Project Baseline reflects the sequence contractually agreed with the Employer, including any approved Variations. WBS structure: The Project programme structure should mirror the WBS.

24 Setting up the delay analysis programme 10 principles Logic Links: All activities should be linked to reflect the execution logic. Critical Path: The main Critical path and sub-critical paths clearly identified. Regular updates: The Project programme should be updated on a regular basis (reflecting standard business practices and/or the specific Contract requirements)

25 Setting up the delay analysis programme 10 principles Assumptions: An assumption note summarizing the key hypothesis for the elaboration of the baseline(s) should support the initial baseline and any subsequent updated baseline(s). Work and Cost structure: The project programme structure should be mapped to the Project cost structure. Claiming rules: The method of capturing physical progress should be defined at the beginning of the Project.

26 Delay analysis choices and methodology

27 AACE International Recommended Practice No. 29R-03 FORENSIC SCHEDULE ANALYSIS Table 1 Nomenclature correspondence (commonly names for classification)

28 SCL Delay and disruption Protocol 2 nd Edition February 2017 Six commonly use methods of delay analysis

29 Delay analysis IMPACTED AS-PLANNED

30 IMPACTED AS PLANNED ANALYSIS As Planned programme (logic linked) Impact Event 1 on the As Planned programme

31 IMPACTED AS PLANNED ANALYSIS Reschedule after Event 1 identification of delay 1 Impact Event 2 on the previous programme

32 IMPACTED AS PLANNED ANALYSIS ADVANTAGES 1) Simple, based on the As Planned programme with critical path 2) Easy to understand and communicate 3) No need of As Built programme (only relevant data for the events impacted) 4) Quick to implement 5) Method widely used by Contractors DISADVANTAGES 1) The Baseline is usually irrelevant after the first update 2) Difficult to demonstrate acceleration, mitigation and/or concurrency 3) Needs to impact separately the Contractor events and the Employer events 4) Almost no judicial support, weak results (theoretical conclusions) 5) Ignores actual progress Reschedule after Event 2 identification of delay 2

33 Delay analysis TIME IMPACT

34 TIME IMPACT ANALYSIS As Planned programme (logic linked) Update progress before Event 1 & reschedule

35 TIME IMPACT ANALYSIS Impact Event 1 into the activity network Reschedule after Event 1 = Delay 1

36 TIME IMPACT ANALYSIS Update progress & reschedule before Event 2 = no delay Impact Event 2 into the activity network

37 TIME IMPACT ANALYSIS ADVANTAGES 1) Simple, based on the As Planned programme with critical path 2) Easy to understand and communicate 3) Can demonstrate acceleration, mitigation and/or concurrency 4) Relies on the actual progress of the works 5) Method widely used by Contractors, sometimes recognised by the Courts DISADVANTAGES 1) Requires a robust/ correct Baseline programme 2) Time consuming, especially on complex projects 3) When used prospectively, can predict only the likely effect of events 4) Can generate theoretical conclusions if as built data is insufficient 5) Expensive to produce, relies on programming skills and experience Reschedule after Event 2 = Delay 2

38 Delay analysis TIME SLICE WINDOWS

39 TIME SLICE WINDOW ANALYSIS As Planned programme (logic linked) Update progress at Window 1 date

40 TIME SLICE WINDOW ANALYSIS Reschedule at Window 1 date identify delay at W1 Update progress at Window 2 date

41 TIME SLICE WINDOW ANALYSIS Reschedule at Window 2 date identify delay at W2 Update progress at Window 3 date

42 TIME SLICE WINDOW ANALYSIS Reschedule at Window 3 date identify any delay Update progress at Window 4 date

43 TIME SLICE WINDOW ANALYSIS ADVANTAGES 1) Simple, based on the As Planned programme with critical path 2) Easy to understand and communicate 3) Can demonstrate acceleration, mitigation and/or concurrency 4) Takes into consideration the actual progress of the works 5) Method widely used by Contractors. DISADVANTAGES 1) Requires a robust/ correct Baseline programme 2) Requires accurate As Built information 3) Difficulties when applied to sequences of work which are different from the planned intentions 4) Can generate theoretical conclusions if as built data is insufficient 5) Not suitable for complex projects with multiple planned critical paths Reschedule at Window 4 date identify delay at W4

44 Delay analysis COLLAPSED AS-BUILT

45 COLLAPSED AS BUILT ANALYSIS As Built programme (without logic links) Reconstructed (Analogous) As Built logic

46 COLLAPSED AS BUILT ANALYSIS Identification of Events 1 and 2 (as built data) Collapse Event 2 (zero duration)

47 COLLAPSED AS BUILT ANALYSIS Reschedule to identify the effect of collapsing Event 2 Collapse Event 1 (zero duration)

48 COLLAPSED AS BUILT ANALYSIS ADVANTAGES 1) The concept is simple, easy to understand 2) Does not need an As Planned programme 3) Relies upon the actual progress of the works 4) Based on records of actual events 5) No requirement to demonstrate the reasonableness of the baseline programme DISADVANTAGES 1) Subjective reconstruction of the Analogous (As Built) critical path 2) Very difficult to assess acceleration and/or mitigation measures implemented during the works 3) The programme/ progress updates during the works are ignored 4) Requires accurate As Built information 5) Requires hand-on experience in preparing the analysis Reschedule to identify the effect of collapsing Event 1

49 CONCLUSIONS RECCOMENDATIONS FOR MAKING AND PRESENTING DELAY CLAIMS Consideration of specific Contract requirements Consideration of the balance between the costs to produce a delay claim and the magnitude of the dispute Agreement on the Baseline programme and subsequent updates of the same Agreement on the method of delay analysis to be applied Treatment of each event separately, with focus on demonstrating: - Entitlement under the Contract - Timely Notice given - Cause of the delay - Effect of the event on the programme Use simple language, free from jargon Demonstrate that the results are grounded in common sense

50 THANK YOU