Helen S. Henningsen Department of Veterans Affairs Office of General Counsel

Transcription

1 Helen S. Henningsen Department f Veterans Affairs Office f General Cunsel

2 Cnstructin & Architect-Engineer Cntracts Changes Delays Disputes 2

3 User changes Changes in standards r cdes Differing site cnditins Value engineering prpsals Defective specificatins r drawings

4 FAR Changes -fr FFP Cnstructin Cntracts ver the Simplified Acquisitin Threshld VAAR Cntract Changes Supplement Requires detailed itemized breakdwn f csts fr changes Prvides caps fr the verhead, prfit and fees that be charged n changes under $500,000 FAR Changes Fixed Price Alternate III -fr Architect Engineer cntracts Under these clauses, if the change causes an increase in the cst, r in the time required t perfrm, the Cntractr is entitled t an equitable adjustment r time extensin.

5 Directed changes - made thrugh written mdificatins t the cntract Change rders Supplemental Agreements Settlements by Determinatin (unilateral mdificatins) Cnstructive changes changes that are infrmally rdered r caused by the Gvernment CO s misinterpretatin f the cntract Defective Specificatins Acceleratin Hindrance r failure t cperate

6 T prve a Cnstructive Change a Cntractr must shw: Wrk was changed The CO rdered the change thrugh wrd r deed Ntice Requirement in Cnstructin Cntracts - the Cntractr must prmptly give the CO written ntice f Cnstructive Changes. Date, circumstances and surce f rdered change Statement that Cntractr cnsiders the rder a change rder N adjustment is allwed fr csts incurred mre that 20 days befre the written ntice was received Except- ntice is nt required fr Cnstructive Changes based n defective specificatins

7 FAR Design within Funding Limitatins Design services must be accmplished t permit award within the specified funding limitatin. If all ffers received are abve the specified funding limitatin, the AE must, at n additinal cst, perfrm redesign services necessary t permit award within the funding limitatin When putting tgether change rder prpsals, cnsider whether the change requires that the funding limitatin als be changed. Ntify the CO if the funding limitatin becmes unrealistic. Changes in the scpe, the materials, r in the funding limitatin may be apprpriate.

8 Make sure yu read the changes clauses in the cntract. Knw what is required f yu and knw yur rights. Submit prpsals fr changes prmptly (VA requires prpsals be submitted as expeditiusly as pssible, but at mst within 30 days). Fr AE Cntracts, make sure yu are mindful f hw any changes affect yur bligatin t Design within Funding Limitatins.

9 In Change Order prpsals, prvide an itemized breakdwn that includes materials, quantities, unit prices, labr csts, and equipment. Ensure all csts are accunted fr. Read and make sure that yu understand any release language in the Supplemental Agreements. Identify any Cnstructive Changes prmptly and prvide the Cntracting Officer with ntice.

10 Excusable Cmpensable Suspensin f wrk Changes clause Nn-Cmpensable Nn Excusable 10

11 Delays that the Cntractr causes r that are in the Cntractr s cntrl. The Cntractr bears its wn csts due t the delay, and the Gvernment has cntractual remedies actual damages due t the delay liquidated damages pssibly default terminatin r paying fr excess csts fr re-prcurement and/r cmpletin by anther cntractr. The Cntractr is usually respnsible fr Subcntractr caused delays.

12 Delay is excusable when it is beynd the cntrl and withut the fault r negligence f the cntractr. The Cntractr is entitled t a time extensin fr excusable delays Cntractr shuld give the CO prmpt written ntice f the excusable delay (within 10 days) Examples f Excusable Delay may include: Acts f Gd Fires Acts f the public enemy Flds Unusually severe weather Strikes Epidemics Freight embargs Acts f the Gv t Acts f anther Cntractr

13 T establish entitlement t relief fr excusable delay, the burden is n the Cntractr t shw: The verall cmpletin f the jb/wrk was delayed Neither time nr mney will be granted fr delays t individual activities that d nt extend the time needed fr verall cmpletin The actual time the verall cmpletin was delayed What caused the delay The cause was excusable The cst impact f the delay (if delay is cmpensable)

14 The Schedule is KEY Knw what the cntract says abut schedule submissin and updates and abut delay. Knw and understand the Ntice requirements fr delays Knw and understand the mitigatin requirements fr delays Get the baseline schedule apprved early. Timely, accurate, cntempraneus mnthly updates are extremely imprtant.

15 Nn-cmpensable Excusable delay - Cntractr may be entitled t additinal time fr such delays, but must bear the cst impact f such delays. Cmpensable Excusable delay Under standard FAR clauses, the Cntractr may be entitled t bth time and csts fr delays that are slely caused by the gvernment Cncurrent nn-excusable delay -the Cntractr is nt entitled t additinal time r mney Cncurrent nn-cmpensable excusable delay - the Cntractr may be entitled t additinal time but nt additinal mney.

16 If the CO suspends delays r interrupts the cntractr fr an unreasnable perid f time, an adjustment shall be made fr the increased cst f perfrmance (excluding prfit) caused by the unreasnable delay. A cmpensable delay can result frm the CO issuing a frmal written suspensin rder (a directed suspensin) r frm the CO s act r failure t act (a cnstructive suspensin). Hwever, a claim fr cnstructive suspensin cannt be allwed fr csts incurred mre than 20 days befre the cntractr prvided the CO with written ntice f the act r failure t act; and Unless a written claim is asserted as sn as practicable after the delay and nt later than final payment.

17 Delays preceding a change are nt recverable under the standard FAR changes clauses. Hwever an equitable adjustment under a changes clause culd include impact and delay csts that result frm the change after its issuance. Under the equitable adjustment prvisin in changes clauses yu are entitled t reasnable csts and prfit. Nte: the VAAR Changes clause impses caps n verhead csts, fees, and prfit fr changes under $500,000. The cap n verhead csts includes unabsrbed hme ffice verhead, a majr expense in delays.

18 Unabsrbed Overhead hme ffice verhead Only allwed where the cntractr is n standby The Cntractr is n standby when it is required t immediately resume wrk at the gvernment s ntice Standby is difficult t prve when nn-critical wrk is nging Eichleay Frmula used Idle Labr and Equipment Escalatin f Labr Rates and Material Prices Lss f Efficiency NOTE: Cntractr must make reasnable effrts t mitigate damages

19 Delays in awarding the Cnstructin Cntracts can impact the AE Cntract Cnstructin Perid Services Design within funding limitatins Changes in cdes and standards

20 Knw and understand yur cntract s clauses n Schedules, Changes, Differing Site Cnditins, Designing within Funding, and Suspensins f Wrk. Maintain accurate mnthly schedule updates. Discuss all pssible delay issues with the Gvernment early. The Cntractr must take reasnable steps t mitigate delays and delay damages Keep detailed recrds. The burden t prve csts is n the Cntractr. The Gvernment ften audits delay claims.

21 Requests fr Equitable Adjustments Filing Claims with the Cntracting Officer Alternate Dispute Reslutin Bard f Cntract Appeals U.S. Curt f Federal Claims

22 Reslving disputes early is less cstly fr bth Cntractrs and the Gvernment. Submit a detailed fully supprted Request fr Equitable Adjustment (REA) befre filing a claim. Explain in detail the relevant facts. If cmpensable delay is claimed, include yur time impact analysis based upn cntemprary schedules. Explain the cntract prvisins and/r ther legal authrity yu are relying upn. Prvide detailed cst breakdwns with the supprting evidence n the actual csts.

23 A Claim is basically a written demand t the Cntracting Officer seeking the payment f mney in a sum certain, the adjustment r interpretatin f cntract terms, r ther relief arising ut f the cntract. Mnetary Claims exceeding $100,000 shuld be certified. Use the certificatin language fund in FAR clause (d)(2)(iii).

24 In the claim, clearly request a Cntracting Officer s Final Decisin (COFD) n the matter. Reference and/r attach all relevant infrmatin that supprts yur demand, including the detailed REAs previusly submitted. When yu get the COFD, read it carefully and nte the appeal and litigatin rights. Bards f Cntract Appeals- within 90 days United States Curt f Federal Claims within 12 mnths I strngly urge yu t cnsider using Alternate Dispute Reslutin r Mediatin t try and reslve disputes.

25

26 Helen S. Henningsen Department f Veterans Affairs Office f General Cunsel