Project Alliance Agreement (PAA) Between

Transcription

1 (PAA Between Transit New Zealand [name of constituent organisation] [name of constituent organisation] [name of constituent organisation] For the design, construction and commissioning of the Project Name NOTES: This document is proposed as a starting point for development of the eventual Project Alliance Agreement. Proponents are requested to give constructive feedback on this draft PAA in their written submissions (refer section 6.1 of RFP. The key elements of the IPAA will be agreed with the preferred proponent. The PAA will be developed to final form during the PAAt Based on a template used on some alliances in Australia, it caters for the situation where there is one constructor organisation and one designer organisation. The final form of the PAA will be revised to suit the structure of the preferred proponent. While Transit supports the general principles and the commercial arrangements embodied within this draft, Transit has not yet undertaken a thorough review of the document. Alliance Agreement Full Delivery For Early Completion Project Name Transit Contract No. Contract Number PAA Issue (draft 1 D4-FD-PAA-Trial 4 Page PAA 1 Printed: 25/02/2009

2 Table Of Contents Project Alliance Agreement Names Of Parties / Background 3 Part A: Roles, Responsibilities And Behaviours 4 1 Overriding Commitments 4 2 Primary Performance Obligations 4 3 Project Alliance Board ("PAB" 5 4 Resolution of Disagreements 6 5 Project Alliance Management Team 7 6 Assignment 8 Part B: Performance Of The Work 9 7 Project Management Plan 9 8 Possession And Care 9 9 Quality of Services and Products Health and Safety Environmental Management 12 Part C: Commercial Arrangements Compensation to OAP1 & OAP Goods and Services Tax Invoices and Payments Audit of Financial Transactions Insurances Changes and Variations Title and Ownership Not used 20 Part D: Time, Progress & Completion Time And Progress Completion Certificates 21 Part E: Default Termination Of Work For Convenience Termination of Work for Default 24 Part F: Information & Communication Intellectual Property Confidentiality / Public Statements Formal Written Notices 26 Part G: Interpretation 27 Interpretation Part H: Signature Page 29 Schedule 1: Definitions 30 Schedule 2: Scope Of The Alliance Works 34 Schedule 3: Alliance Charter 35 Schedule 4: Requirements & Minimum Standards 36 Schedule 5: Organisation Chart 37 Schedule 6: Materials To Be Provided By Transit 38 Schedule 7: Terms Of Compensation 39 Schedule 7: Terms Of Compensation - Appendix 1 45 Schedule 8: Progress Payment Certificate 46 Schedule 9: Practical Completion Payment Certificate 47 Schedule 10: Final Payment Certificate 48 Schedule 11: Variation Notice / Approval 49 Schedule 12: Certificate Of Practical Completion 50 Schedule 13: Certificate Of Final Completion 51 Schedule 14: Annexure 52 D4-FD-PAA-Trial 4 Page PAA 2 Printed: 25/02/2009

3 Names Of Parties / Background Project Alliance Agreement Names of Parties / Background This Project Alliance Agreement ( PAA is made on <<<Day, Date, Month, Year>>> between Transit New Zealand of <<insert address details>> ( Transit and OTHER ALLIANCE PARTICIPANT 1 (a constructor of <<insert address details>> ( Other Alliance Participant 1 or OAP1 and OTHER ALLIANCE PARTICIPANT 2 (a designer of <<insert address details>> ( Other Alliance Participant 2 or OAP2 Background a Background information on the Project. b The parties entereed into an Interim Project Alliance Agreement dated <<<Date>>> whereby OAP1 and OAP2 undertook pre-construction activities associated with the Project. c Having agreed on a Target Cost and other risk:reward parameters for the Project the Alliance Participants wish to enter into an alliance for the fdull delivery of the Project under the terms set out in this PAA. d In this PAA words and expressions not otherwise defined in the main text of this PAA will have the meanings assigned to them in Schedule 1, except where the context requires otherwise. D4-FD-PAA-Trial 4 Page PAA 3 Printed: 25/02/2009

4 Part A: Roles, Responsibilities And Behaviours Project Alliance Agreement Part A: Roles, Responsibilities And Behaviours The Alliance Participants agree as follows: 1 Overriding Commitments 1.1 Commitment to Alliance Principles The Alliance Participants hereby commit to work together in a manner so as to achieve the successful delivery of the Alliance Works The Alliance Participants have developed, committed to and signed off on the Alliance Charter in Schedule 3. The Alliance Participants undertake to adhere to the principles set out in the Alliance Charter (the Alliance Principles. 1.2 Commitment to act in good faith Each Alliance Participant undertakes to conduct its activities arising out of this PAA in good faith. Acting in good faith in this case includes: a Being fair, reasonable and honest; b Doing all things reasonably expected of it by another Alliance Participant and by this PAA; c Not impeding or restricting another Alliance Participant s performance; and d Giving as much weight to the interests of the Project as to one s own self interest. 2 Primary Performance Obligations 2.1 Alliance Participants collectively The Alliance Participants collectively shall design, construct, commission and handover the Alliance Works: a On or before the Target Completion Date; b So that they: Meet the Requirements and Minimum Standards prescribed by Transit as set out in Schedule 4, Are free from defects by the Date of Final Completion, Do not infringe any patent, copyright, registered design, trademark or name or other protected right; c In a diligent skilful workmanlike manner; d In compliance with all applicable laws; e With the aim at all times of minimising cost expenditure OAP1 will provide Staff, Labour, Construction Plant, project management services, subcontracts and Materials (apart from Materials expressly provided by Transit as necessary to perform the Work under the Alliance OAP2 will be the primary provider of Design Services and will provide Staff within the Alliance Management Team referred to in clause 5.1 ( the AMT Transit will be the primary provider of resources to commission the facilities and will provide one or more Staff within the AMT Unless expressly stated in this PAA or agreed otherwise Transit and OAP2 will not be obliged to provide any Labour, Construction Plant, subcontracts or Materials. D4-FD-PAA-Trial 4 Page PAA 4 Printed: 25/02/2009

5 Part A: Roles, Responsibilities And Behaviours 2.2 Transit s specific obligations Transit shall: a Provide access to the Site to enable the Alliance Participants to undertake the Work under the Alliance; and b Pay the Other Alliance Participants in accordance with the terms of this PAA. 3 Project Alliance Board ("PAB" 3.1 Establishment, duties & authority The PAB is hereby established with an overall charter to administer this PAA and provide guidance to the Alliance Participants with respect to the Work under the Alliance The Alliance Participants must implement all decisions and directions of the PAB (and of Transit where expressly provided for in this PAA in respect of the Work under the Alliance given in accordance with this PAA. 3.2 Representation The PAB will consist of one or more senior representatives from each of the Alliance Participants (the PAB Members At the time of execution of this PAA and unless and until advised otherwise by an Alliance Participant the PAB Members are those persons nominated in the Annexure Subject to clause 3.2.4, an Alliance Participant may replace its PAB Member(s at any time, or nominate a substitute ( Substitute PAB Member by giving notice in writing to the other Alliance Participants at least 24 hours prior to the change in representation The Alliance Project Manager or acting Alliance Project Manager may not act as a Substitute PAB Member In respect of any matter which is within the powers of the PAB as contemplated by this PAA, the individual PAB Members (and their Substitute PAB Members are hereby authorised to bind the Alliance Participant they represent to the decisions of the PAB. 3.3 Voting and decision-making protocols All decisions by the PAB will be by vote as follows: a Each PAB Member (or Substitute PAB Member will be entitled to cast a vote. b All votes must be cast. c Every decision by the PAB must be unanimous i.e. it must be supported by all PAB Members. 3.4 Duties of the PAB The duties of the PAB are to: a Set policy and give philosophical and strategic direction for the alliance within the boundaries set out in this PAA. b Appoint persons to the AMT, monitor the performance of the AMT and implement appropriate measures to correct undesirable trends. D4-FD-PAA-Trial 4 Page PAA 5 Printed: 25/02/2009

6 Part A: Roles, Responsibilities And Behaviours c Set, review and revise limits of delegated authority as appropriate. d Issue various directions, approvals and decisions as required by this PAA. e Initiate and/or approve the commitment of resources to the Project and provide corporate support as necessary. f Resolve any differences / issues that are referred to it. g Provide leadership and set a visible example for all to see of the Alliance Principles in action at a senior level. 3.5 Meetings of the PAB Prior to the Date of Practical Completion the PAB will hold a meeting at least every month After the Date of Practical Completion, the PAB will meet as often as is necessary to enable it to fulfil its duties under this PAA. 3.6 Minutes of meetings The Alliance Participants will arrange for a secretary ( the PAB Secretary who will attend all PAB meetings The PAB Secretary will record all resolutions of the PAB and all actions arising out of each PAB meeting The PAB Secretary will issue copies of the Resolution & Action Notes by or fax to each PAB Member, to the Alliance Project Manager, the External Alliance Auditor and others as appropriate within 2 days after each PAB meeting. 4 Resolution of Disagreements 4.1 Procedure for handling disagreements The Alliance Participants will try to settle any Alliance Disagreement in good faith in a manner consistent with the Alliance Principles If despite their efforts, an Alliance Disagreement remains unresolved, an Alliance Participant, if it wishes to pursue the matter, may give a written notice to each of the other Alliance Participants requesting that the Alliance Disagreement be considered by the PAB The PAB will consider any Alliance Disagreement referred to it and will give due consideration to submissions by all Alliance Participants, to any recommendation by the Alliance Project Manager in respect of the Alliance Disagreement and to any other relevant information. 4.2 No arbitration or litigation Except as provided in clause below it is the intention of the Alliance Participants: a that the PAB will deal with any Alliance Disagreement and the Alliance Participants will do their utmost to ensure that the PAB is able to fulfil this crucial function effectively and efficiently; and b that there will be no arbitration or litigation between the Alliance Participants on any Alliance Disagreement. D4-FD-PAA-Trial 4 Page PAA 6 Printed: 25/02/2009

7 Part A: Roles, Responsibilities And Behaviours A failure by any Alliance Participant to perform any obligation or to discharge any duty under or arising out of this PAA will not give rise to any enforceable obligation at law or in equity whatsoever save and except to the extent that the failure also constitutes an Event of Default. 5 Project Alliance Management Team 5.1 Organisation Chart The day-to-day management of the Work under the Alliance will be by an Alliance Management Team ( the AMT made up of persons from the Alliance Participants, selected on a best-for-project basis The AMT will be headed by the Alliance Project Manager Unless agreed otherwise by the PAB the AMT will be structured along the lines set out in the Organisation Chart in Schedule Appointment of Alliance Project Manager The Alliance Project Manager is the person nominated as such in the Organisation Chart The PAB may remove or replace the Alliance Project Manager at any time The PAB may: a Appoint a person to act as Alliance Project Manager on an interim basis during any period in which the Alliance Project Manager is unavailable; and/or b Make different appointments for different stages of the Work The Alliance Project Manager or acting Alliance Project Manager will report to the PAB and attend PAB meetings as required by the PAB but will have no voting rights. 5.3 Duties of Alliance Project Manager The Alliance Project Manager will be responsible to the PAB and will carry out the duties of the Alliance Project Manager set out below and as directed by the PAB The Alliance Project Manager must act within the prescribed financial and other limits as advised by the PAB. Items or decisions outside those delegated limits must be referred to the PAB for a decision The Alliance Project Manager will be accountable for ensuring that the objectives set out in the Alliance Charter in Schedule 3 are achieved The Alliance Project Manager will be responsible for: a Day-to-day management of the AMT such that the Work under the Alliance is carried out in accordance with the requirements set out in this PAA or as otherwise directed by the PAB; b Implementing the directions and decisions of the PAB. c Issuing a Weekly Report to the PAB Members each week by in the format prescribed by the PAB. d Issuing a Monthly Report to the PAB Members, and the External Alliance Auditor by in the format and on the day prescribed by the PAB. e Attending PAB meetings as required by the PAB. D4-FD-PAA-Trial 4 Page PAA 7 Printed: 25/02/2009

8 Part A: Roles, Responsibilities And Behaviours f Providing leadership to the AMT and setting an example of the Alliance Principles in action. g Other duties as directed from time to time by the PAB The Alliance Project Manager will consult with the other leaders within the AMT and make every reasonable effort to arrive at a consensus on all matters affecting the Work under the Alliance. However there is no requirement that the decisions and directions of the Alliance Project Manager must have the full support of all members of the AMT. 6 Assignment No Alliance Participant may assign any of its rights, obligations or interest in this PAA to any person or company without the prior written consent of the other Alliance Participants. D4-FD-PAA-Trial 4 Page PAA 8 Printed: 25/02/2009

9 Part B: Performance Of The Work Project Alliance Agreement Part B: Performance Of The Work 7 Project Management Plan The Alliance Participants have already prepared a draft Project Management Plan ( PMP The Alliance Project Manager will submit a proposed final version of the PMP for approval by the PAB in the first PAB meeting following the execution of this PAA The final PMP will: a Set out key policies relating to the Work under the Alliance; b Specify the delegated limits of financial and general authorities and the protocols for review and change of those delegated limits. c Include detailed plans / procedures for the management of all key aspects of the Work under the Alliance including, but not limited to the following plans: Design Management Plan Site Establishment Plan Construction Plan including schedule Commissioning Plan Project Systems Plan Finance and Administration Plan Health & Safety Plan Quality System Plan Environmental Management Plan Procurement Plan Stakeholder Management Plan d Specify what aspects of the PMP can be amended by the Alliance Project Manager and what aspects can only be amended by the PAB The Alliance Participants will at all times adhere to the procedural and other requirements stated in the PMP as amended from time to time, including all the various Plans that are embodied within the PMP. 8 Possession And Care 8.1 Possession of Site Transit will give the Alliance Participants sufficient possession of the Site to enable the Alliance Participants to perform the Work under the Alliance in accordance with this PAA Any delay by Transit in giving the Alliance Participants possession of the Site will not be a breach of this PAA, but may be grounds for a Variation in accordance with clause Demobilisation and clean-up The Alliance Participants will maintain the Site in a safe, clean and tidy condition Upon completing the Work under the Alliance and prior to the issue of the Certificate of Practical Completion, the Alliance Participants will: D4-FD-PAA-Trial 4 Page PAA 9 Printed: 25/02/2009

10 Part B: Performance Of The Work a remove all Construction Plant, buildings and other temporary structures and all equipment, surplus materials and rubbish from the Site; and b leave the whole of the Alliance Works in a safe, clean and tidy condition to the satisfaction of Transit. 8.3 Care of the Alliance Works The Alliance Participants will be responsible for the care, safety, protection, security, maintenance, repair, reinstatement and clean-up after use, of the Alliance Works from the date of execution of this PAA until the Date of Practical Completion Subject to clause 9.5, Transit will be responsible for the care of the Alliance Works after the Date of Practical Completion Nothing in clause will lessen the Alliance Participants' obligation to attend to Alliance Defects pursuant to clause Quality of Services and Products 9.1 General The Alliance Participants will ensure that the Alliance Works and the Work under the Alliance are of the highest quality consistent with the requirements of this PAA The Alliance Participants will, unless stated otherwise in this PAA, supply everything necessary for the proper completion of the Work under the Alliance The Alliance Participants will ensure that all Materials they provide are: a correctly designed, fabricated and installed to the standards set out in this PAA; and b suitable for their intended use The Alliance Participants will obtain written warranties in favour of Transit from Suppliers and Subcontractors, to the extent that such warranties are relevant, that Materials are: a correctly designed, fabricated and installed to the standards set out in this PAA; and b suitable for their intended use. 9.2 Quality System Requirements As part of the PMP the Alliance Participants will establish, implement and maintain a Quality System Plan in respect of the Work that complies with the requirements of ISO Each Alliance Participant shall at all times provide each of the other Alliance Participants with full access to all Records connected with the Quality System Plan where such access is necessary for assessment of an Alliance Participant's performance The Alliance Participants, individually or collectively, or the Alliance Project Manager may at any time arrange for audits of the Quality System. 9.3 Materials provided by Transit Schedule 6 contains a list of Materials which it is intended will be provided by Transit. Schedule 6 gives details of quantities, method of supply and responsibility for transport. D4-FD-PAA-Trial 4 Page PAA 10 Printed: 25/02/2009

11 Part B: Performance Of The Work Upon discovering a defect or problem with Materials supplied by Transit the Alliance Participants will immediately notify the Alliance Project Manager and Transit giving details of the defect or problem. 9.4 Inspection and testing The Alliance Participants will carry out inspection and testing of the Alliance Works and the Work under the Alliance as required by and in accordance with the requirements set out in this PAA and applicable laws and regulations At all times, the Alliance Participants and their authorised nominees will have the right to: a inspect and test, or witness the inspection or testing of, any and all of the Materials and workmanship furnished by the Alliance Participants, their Subcontractors, Suppliers, employees, agents and representatives. b access the off-site premises of Suppliers and Subcontractors for the purpose of conducting inspections and testing, to the extent that the subcontract or supply agreement enables such access. 9.5 Defective Work Transit, the PAB or the Alliance Project Manager may at any time prior to the Date of Final Completion issue an Alliance Defect notice ( ADN directing the Alliance Participants to attend to the rectification of Alliance Defects Upon receipt of an ADN the Alliance Participants will rectify the Alliance Defect within the period stated in the ADN and in accordance with any other requirement stated in the ADN Transit will be entitled to rectify an Alliance Defect itself or engage others to do the rectification work if: a Transit considers the rectification must be carried out urgently for safety, environmental or other reasons of urgency; or b Transit considers that the Alliance Participants will not be able to undertake the rectification work in the time and/or manner specified in the ADN. Costs incurred by Transit for rectification work carried out by Transit or a 3 rd party under this clause 9.5 will be treated as Transit Alliance Costs. 10 Health and Safety 10.1 General commitment The Alliance Participants will make every reasonable effort to provide and maintain a workplace free of accidents and injuries Compliance The Health & Safety Plan ( H&S Plan which forms part of the PMP shall be consistent with the requirements of relevant legislation In carrying out the Work under the Alliance the Alliance Participants will ensure that they comply with: a the latest H&S Plan approved by the Alliance Board; b all relevant legislation including regulations in force under that legislation; D4-FD-PAA-Trial 4 Page PAA 11 Printed: 25/02/2009

12 Part B: Performance Of The Work c all reasonable safety directives, procedures and work instructions issued by the Alliance Project Manager, and/or the authorised safety officers of Transit, or other authorised personnel Obligations under safety legislation For the purposes of relevant health and safety legislation each Alliance Participant will be deemed to be the employer in respect of all operations that are within its control and/or the control of its subcontractors, suppliers, employees and agents Safety audits The Alliance Project Manager and/or the Alliance Participants, either individually or collectively, may at any time carry out audits on the H&S Plan and/or the Alliance Participants compliance with the Safety Plan The Alliance Participants shall provide all documents, access and assistance necessary to facilitate such audits If any non-conformance in the H&S Plan is detected, the Alliance Participants shall immediately rectify the non-conformance. 11 Environmental Management 11.1 General commitment The Alliance Participants undertake to exercise the utmost care to prevent, in the course of performing the Work under the Alliance, pollution or any damage to the environment The Alliance Participants must comply with all reasonable environmental directives and procedures issued by the PAB and/or the Alliance Project Manager The Alliance Participants must obtain, comply with, and promptly hand over to Transit any licence or approval required by the Environmental Protection Agency in connection with the Alliance Works Environmental Management Plan The Environmental Management Plan which forms part of the PMP must be consistent with all relevant legislation The Alliance Participants must not commence any work on Site, apart from survey work, until the Environmental Management Plan has been approved by the PAB The Alliance Participants must at all times comply in all respects with the Environmental Management Plan. D4-FD-PAA-Trial 4 Page PAA 12 Printed: 25/02/2009

13 Part C: Commercial Arrangements Project Alliance Agreement Part C: Commercial Arrangements 12 Compensation to OAP1 & OAP Terms of compensation The compensation set out in the Terms of Compensation in Schedule 7 will be the sole compensation to the Other Alliance Participants for the complete fulfilment of all their obligations under this PAA. 13 Goods and Services Tax 13.1 Interpretation / application This clause 13 applies if any of the Alliance Participants become liable to pay GST in relation to any goods or services supplied under this PAA Particulars of GST For the purposes of each of the various Payment Certificates referred to in clause 14 the Other Alliance Participants will provide the necessary progress billing information to the Alliance Project Manager in a form that constitutes a valid Tax Invoice The Alliance Project Manager will provide to Transit all relevant OAP1/OAP2 Tax Invoices so as to enable Transit to claim an Input Tax Credit for GST included in such certificates, as allowable under GST Law Apportionment of Consideration If any part of the consideration under this PAA is referable to both a Taxable Supply and anything that is not a Taxable Supply, the Value of any Taxable Supply shall be determined as required by the GST Law Payments to Transit In the event that OAP1 and/or OAP2 are required to pay an amount to Transit which constitutes consideration for a Taxable Supply, OAP1 and/or OAP2 shall, at the same time as making the payment which constitutes consideration, reimburse Transit for the amount of Transit s GST liability and Transit shall at that time issue to OAP1 and/or OAP2 a Tax Invoice in the correct form. 14 Invoices and Payments 14.1 General An Alliance Participant who owes money to another Alliance Participant pursuant to this PAA will pay the other Alliance Participant interest compounded daily using the annual rate of interest stated in the Annexure for any time the payment remains overdue The amounts to be included in the various payment certificates referred to in this clause 14 will be calculated in accordance with the formulae in clause S Prior to Practical Completion At the times or periods specified in the Annexure the Alliance Project Manager will, with input from the Alliance Participants, prepare and submit a Progress Payment Certificate to Transit for an amount calculated in accordance with clause S7-9.1, in the form set out in Schedule 8 with the declaration in Part 2 signed by the External Alliance Auditor, and accompanied by: D4-FD-PAA-Trial 4 Page PAA 13 Printed: 25/02/2009

14 Part C: Commercial Arrangements a A valid Tax Invoice for OAP1; and b A valid Tax Invoice for OAP Within the time specified in the Annexure Transit will pay the Other Alliance Participants the amounts certified in the Progress Payment Certificate All progress payments will be deemed to be provisional payments on account and subject to a final verification audit by the External Alliance Auditor After Practical Completion Within the number of days specified in the Annexure after the Date of Practical Completion Transit will ensure that the External Alliance Auditor: a Conducts a comprehensive audit of OAP1, OAP2 and Transit Records to determine the amount payable to/from OAP1/OAP2 pursuant to clause S7-9.2; and b Discusses his findings with the Alliance Project Manager; and c Submits a detailed audit report to the PAB and Transit; and d Together with the Alliance Project Manager, prepares Part 1 of a Practical Completion Payment Certificate in the form set out in Schedule 9 and submits it to the PAB for approval Within the number of days specified in the Annexure after the PAB receives the partially completed Practical Completion Payment Certificate: a the PAB will make a determination of the amounts owing to or owed by Transit as the case may be; and b the PAB Members will correct Part 1 as necessary and sign Part 2 of the Practical Completion Alliance Payment Certificate Within 14 days after the PAB Members have signed the Practical Completion Payment Certificate: a Transit will make payments to OAP1 and/or OAP2; or b OAP1 and/or OAP2 will make payments to Transit, as the case may be in accordance with the Practical Completion Payment Certificate Final Alliance Payment Transit will ensure that within the number of days specified in the Annexure after the Date of Final Completion the External Alliance Auditor: a Conducts a comprehensive final audit of OAP1, OAP2 and Transit Records to determine the amount payable to/from OAP1/OAP2 pursuant to clause S7-9.3; b Discusses his findings with the Alliance Project Manager; c Submits a detailed audit report to the PAB and Transit; and d Together with the Alliance Project Manager, prepares Part 1 of a Final Payment Certificate in the form set out in Schedule 10 and submits it to the PAB for approval Within the number of days specified in the Annexure after the PAB receives the partially completed Final Alliance Payment Certificate: D4-FD-PAA-Trial 4 Page PAA 14 Printed: 25/02/2009

15 Part C: Commercial Arrangements a The PAB will make a final determination of the amounts owing to or owed by Transit as the case may be; and b The PAB Members will correct Part 1 as necessary and sign Part 2 of the Final Payment Certificate Within 14 days after the PAB Members have signed the Final Payment Certificate: a Transit will make payments to OAP1 and/or OAP2; and/or b OAP1 and/or OAP2 will make payments to Transit, as the case may be, in accordance with the Final Payment Certificate The payments made in accordance with the Final Payment Certificate will be deemed to be in full and final settlement of all entitlements to compensation arising pursuant to the Terms of Compensation in Schedule 7, unless a further payment becomes due under clause 16.7 below. 15 Audit of Financial Transactions 15.1 General The Alliance Participants acknowledge that it is of paramount importance to Transit that all commercial aspects of this PAA are administered in a transparent manner that demonstrates to all Alliance Participants that all payments made under this PAA are in accordance with the terms of this PAA External Alliance Auditor The person or company nominated in the Annexure has been appointed by Transit as the External Alliance Auditor and the Alliance Participants hereby accept that person or company as the External Alliance Auditor The External Alliance Auditor's overriding brief from Transit is to ensure in respect of all payments made pursuant to this PAA that Other Alliance Participants receive their exact entitlement as set out in Schedule Transit will ensure that any reports or advice from the External Alliance Auditor that raise concerns about the amounts claimed or reimbursed to OAP1 and/or OAP2 are brought to the attention of the PAB at the next PAB meeting Provided it has given prior notice in writing to Other Alliance Participants, Transit may appoint a different person or company to be the External Alliance Auditor References in this PAA to the External Alliance Auditor will include the authorised representatives of the External Alliance Auditor Audit of OAP1 & OAP2 Records Until such time as all payments under this PAA have been made, the External Alliance Auditor will have access at all reasonable times to the personnel and Records of Other Alliance Participants that are related to the compensation received by or due to Other Alliance Participants pursuant to this PAA The External Alliance Auditor will have the right to reproduce any of the Records referred to in clause The costs incurred by Transit pursuant to this clause 15.3 will not be considered to be Transit Alliance Costs for the purposes of this PAA, regardless of the findings of the audit. D4-FD-PAA-Trial 4 Page PAA 15 Printed: 25/02/2009

16 Part C: Commercial Arrangements 15.4 Audit of Transit s Records If either OAP1 or OAP2 wishes to carry out an audit of any of Transit s Records related to the amounts due to OAP1/OAP2 under this PAA, it will engage the External Alliance Auditor to conduct the audit on its behalf If the External Alliance Auditor declines or is unable to undertake an audit of Transit s Records on behalf of OAP1 or OAP2 then OAP1/OAP2 may engage an Alternative Auditor to undertake the audit Until such time as all payments under this PAA have been made the External Alliance Auditor or the Alternative Auditor will have access at all reasonable times to the personnel and Records of Transit that are related to the compensation received by or due under this PAA to the Alliance Participant that commissioned the audit The External Alliance Auditor or the Alternative Auditor will have the right to reproduce any of the Records referred to in clause The costs incurred by OAP1/OAP2 in carrying out an audit of Transit s Records including the costs of engaging the External Alliance Auditor and/or an Alternative Auditor will not be reimbursed regardless of the outcome of the audit Retention of Records Without limiting an Alliance Participant s obligations at law, the Alliance Participants will preserve and maintain in good condition and in an easily accessible filing and retrieval system all Records until such time as all payments under this PAA have been made. 16 Insurances 16.1 Insurance of the Works Before the Alliance Participants commence any physical work on Site the Alliance Participant nominated in the Annexure will take out a contract works insurance policy (the CWI policy covering the Alliance Works against loss or damage resulting from any cause whatsoever until the Date of Final Completion Unless agreed otherwise by the PAB: a The CWI policy must comply with the specific requirements set out in this clause 16.1; and b The terms of the CWI policy must be consistent with the terms of the draft contract works insurance policy appended to this PAA The CWI policy shall be effected with an insurer approved by the PAB The CWI policy shall be in the joint names of the Alliance Participants and shall cover Transit, the Other Alliance Participants and all Subcontractors employed from time to time in relation to the Alliance Works for their respective rights, interests and liabilities The CWI policy shall cover the care of the Works and things in storage off Site and in transit to the Site The CWI policy shall be for an amount in respect of any one occurrence not less than the sum stated in the Annexure The excess under the CWI policy shall be no more than the amount stated in the Annexure. D4-FD-PAA-Trial 4 Page PAA 16 Printed: 25/02/2009

17 Part C: Commercial Arrangements 16.2 Public liability insurance The Alliance Participant nominated in the Annexure shall take out a public liability policy of insurance in the joint names of Transit, the Other Alliance Participants before the Alliance Participants commence any Work under the Alliance that might give rise to an entitlement to claim under that policy Unless agreed otherwise by the PAB: a The public liability policy must comply with the specific requirements set out in this clause 16.2; and b The terms of the public liability policy must be consistent with the terms of the draft public liability insurance policy appended to this PAA The public liability policy shall be effected with an insurer approved by the PAB The terms of the public liability policy must be approved by the PAB, and unless agreed otherwise the public liability policy shall meet the specific requirements set out in this clause The public liability policy shall, in relation to the Work under the Alliance: a Cover the Alliance Participants for their respective rights and interests and liabilities to 3 rd parties; and b Cover all Subcontractors employed from time to time by the Alliance Participants for their respective rights and interests and their liabilities to 3 rd parties in regard to all Work under the Alliance carried out by those Subcontractors on or adjacent to the Site; and c Cover each Alliance Participant s liability to each of the other Alliance Participants for loss of or damage to property (other than property required to be insured by clause 16.1 and the death of or injury to any person (other than liability which is required by law to be insured under a workers compensation policy of insurance from the date of this PAA until the Date of Final Completion The public liability policy shall be for an amount in respect of any one occurrence not less than the sum stated in the Annexure The excess under the public liability policy shall be no more than the amount stated in the Annexure Subject to clause below, each Alliance Participant ( the Indemnifier agrees to indemnify each of the other Alliance Participants (each an Indemnified Participant against claims by a 3 rd party against the Indemnified Participant in respect of: a Personal injury including death, disease and mental as well as bodily injury; or b Death; or c Loss of or damage to any property arising out of or as a consequence of the carrying out by the Indemnifier of the Work under the Alliance. D4-FD-PAA-Trial 4 Page PAA 17 Printed: 25/02/2009

18 Part C: Commercial Arrangements The Indemnifier s liability to indemnify an Indemnified Participant under clause above shall be reduced proportionally to the extent that an act or omission of the Indemnified Participant, or employees or agents of the Indemnified Participant, may have contributed to the loss, damage, death or injury Professional Indemnity Insurance Before the Alliance Participants commence any Work under the Alliance that might give rise to a claim for breach of professional duty, the Alliance Participant nominated in the Annexure shall take out a professional indemnity policy of insurance ( the PI policy covering OAP1, OAP2 and Transit for: a Their legal liability to 3 rd parties for breach of professional duty arising out of the Work under the Alliance; and b Loss or damage suffered by the Alliance Participants as a result of the acts errors or omissions of any of the Alliance Participants To the extent that OAP1 or OAP2 incurs additional cost in procuring the PI policy that it would not have incurred in the course of its normal business operations, that additional cost will be treated as a limb 1 reimbursable item pursuant to Schedule Unless agreed otherwise by the PAB: c The PI policy must comply with the specific requirements set out in this clause 16.3; and d The terms of the PI policy must be consistent with the terms of the draft professional indemnity insurance policy appended to this PAA The PI policy shall be effected with an insurer approved by the PAB The terms of the PI policy must be approved by the PAB, and unless agreed otherwise the PI policy shall meet the specific requirements set out in this clause The PI policy shall be maintained until the date of Final Completion and for a run-off period beyond the Date of Final Completion as stated in the Annexure The PI policy shall be for an amount in respect of any one occurrence not less than the sum stated in the Annexure The excess under the PI policy shall be no more than the amount stated in the Annexure Insurance of employees Each Alliance Participant shall maintain insurances until the Date of Final Completion against liability for death of or injury to its employees including liability by statute and at common law OAP1 s employee insurance policy and OAP2 s employee insurance policy shall each be extended to indemnify Transit for Transit s statutory liability to persons employed by the Other Alliance Participants The Alliance Participants shall ensure that every Subcontractor is similarly insured Insurance of vehicles / equipment Each Alliance Participant will take out and maintain appropriate insurances until the Date of Final Completion for any vehicles and/or equipment that it utilises in carrying out the Work under the Alliance. D4-FD-PAA-Trial 4 Page PAA 18 Printed: 25/02/2009

19 Part C: Commercial Arrangements The cost of such insurances and the risk of any excesses associated with claims under those policies will be deemed to be included in the rates reimbursed to the Other Alliance Participants for vehicles and/or items of equipment that they provide Notices of potential claims The Alliance Participant(s responsible for taking out and maintaining the CWI, public liability and/or PI policies shall, as soon as practicable, inform Transit and the PAB in writing of any occurrence that may give rise to a claim under any of those policies and shall keep Transit and the PAB informed of subsequent developments concerning the claim The Alliance Participants shall ensure that Subcontractors in respect of their operations similarly inform Transit and the PAB Pass through of insurance payouts To the extent that OAP1 or OAP2 receives payment under either the CWI policy or the PI policy that reimburses any cost loss or expense that was reimbursed or is reimbursable under this PAA then OAP1/OAP2 shall pass on that payment to Transit in full, and if that payment is received by Transit after the date when all the PAB Members have signed the Final Payment Certificate pursuant to clause , then within a further 21 days Transit shall: a Arrange for the External Alliance Auditor to recalculate the Final Payment Certificate to take into account the income received under the policy; and b Issue further payments to Other Alliance Participants such that the total amounts paid to Other Alliance Participants under this PAA are in accordance with the recalculated Final Payment Certificate Cross Liability Any insurance required to be effected by the Alliance Participants in joint names shall include a cross-liability clause in which the insurer agrees to waive all rights of subrogation or action against any of the persons comprising the insured and for the purpose of which the insurer accepts the term "insured" as applying to each of the insureds as if a separate policy of insurance had been issued to each of them (subject always to the overall sum insured not being increased thereby. 17 Changes and Variations 17.1 Power to direct Changes Either Transit or the PAB may direct a Change and the Alliance Participants will comply with any such direction When is a Change a Variation? For the purposes of this PAA, a Change will only be considered to be a Variation if: a The PAB decides there is: a significant increase or decrease in the scope of the Work under the Alliance; or a change in the fundamental parameters underlying the design of the Alliance Works; or b There is a suspension of the Work under the Alliance pursuant to clause ; or D4-FD-PAA-Trial 4 Page PAA 19 Printed: 25/02/2009

20 Part C: Commercial Arrangements c Other circumstances arise which, in the opinion of the PAB justify a Variation Variation approval process No adjustment to compensation in respect of a Variation will be made unless and until the PAB has approved the Variation. For this purpose the PAB shall use the form in Schedule The amounts to be paid to the Other Alliance Participants will be adjusted for Variations in accordance with clause S7-7 in Schedule Title and Ownership 18.1 Transfer of title to goods All Materials furnished by OAP1 and/or OAP2 and their Suppliers and Subcontractors in connection with the Work under the Alliance become the property of Transit upon the earlier of the following events: a Transit pays OAP1 and/or OAP2 for the Materials; or b The Materials are delivered to the Site The Alliance Participants will ensure that the contracts they enter into with Suppliers and Subcontractors are consistent with the provisions of clause Ownership of residual items All items supplied by Transit will remain the property of Transit regardless of whether or not they are incorporated into the Alliance Works or consumed in performance of the Work under the Alliance Any item for which OAP1 or OAP2 receive reimbursement under clauses S7-2 or S7-3 that is excess to what is required to complete the Work under the Alliance will, prior to Final Completion, be: a sold to a 3 rd party, OAP1 or OAP2, in which case the proceeds of that sale will be taken into account in calculating the Final Actual Cost under clause S7-8.2; or b retained by Transit in which case an adjustment will be made when calculating the Final Actual Cost under clause S7-8.2 as though that item had been sold to a 3 rd party at fair market value Liens and encumbrances The Alliance Participants will ensure that the Alliance Works are free of all liens, encumbrances and claims of 3 rd parties unless Transit has given prior written approval for such liens, encumbrances or claims. 19 Not used D4-FD-PAA-Trial 4 Page PAA 20 Printed: 25/02/2009

21 Part D: Time, Progress & Completion Project Alliance Agreement Part D: Time, Progress & Completion 20 Time And Progress 20.1 Progress and handover The Alliance Participants will take all reasonable steps to undertake and handover the Alliance Works on or before the Target Completion Date, in accordance with or ahead of the programme embodied in the Project Management Plan The PAB may adjust milestones and dates for completion to take account of Variations Suspension of Work The Alliance Participants will comply with any notice in writing issued by Transit or the PAB to suspend any portion of the Work. 21 Completion Certificates 21.1 Certificate of Practical Completion When the Alliance Project Manager considers that the Alliance Works have reached Practical Completion, the Alliance Project Manager will complete and sign Part 1 of the Certificate of Practical Completion contained in Schedule 12 and issue it to the PAB for consideration Within 21 days of receiving the notice referred to in clause the PAB will consider the Certificate of Practical Completion and will either: a Complete Part 2 of the Certificate of Practical Completion certifying the Date of Practical Completion; or b Issue a list of Alliance Defects which the PAB has decided must be rectified prior to the issue of the Certificate of Practical Completion When the Alliance Project Manager considers that the Alliance Participants have attended to the Alliance Defects referred to in clause b the Alliance Project Manager will issue a further Certificate of Practical Completion to the PAB pursuant to clause , and the process repeated until the PAB issues a completed Certificate of Practical Completion pursuant to clause a Certificate of Final Completion When the defects period stated in the Annexure has elapsed after the Date of Practical Completion, and provided the Alliance Project Manager is not aware of any outstanding Alliance Defects, the Alliance Project Manager will complete and sign Part 1 of the Certificate of Final Completion contained in Schedule 13 and issue it to the PAB for consideration Within 21 days of receiving the notice referred to in clause the PAB will consider the Certificate of Final Completion and will either: a Complete Part 2 of the Certificate of Final Completion certifying the Date of Final Completion; or b Issue a list of Alliance Defects directing the Alliance Participants to rectify those Alliance Defects. D4-FD-PAA-Trial 4 Page PAA 21 Printed: 25/02/2009

22 Part D: Time, Progress & Completion When the Alliance Project Manager considers the Alliance Participants have attended to the Alliance Defects referred to in clause b the Alliance Project Manager will issue a further Certificate of Final Completion to the PAB pursuant to clause and the requirements of clause and clause will continue to apply until the PAB issues a completed Certificate of Final Completion pursuant to clause a. D4-FD-PAA-Trial 4 Page PAA 22 Printed: 25/02/2009

23 Part E: Default Project Alliance Agreement Part E: Default 22 Termination Of Work For Convenience 22.1 Transit right to terminate for convenience Transit has the right at any time and for any reason to direct that all Work under the Alliance cease permanently, by issuing a Notice of Termination to the Alliance Participants, with a copy of the notice to the Alliance Project Manager and each of the PAB Members, giving details of Transit s requirements for cessation of the Work Alliance Participants obligations Upon receiving a Notice of Termination the Alliance Participants will, subject to the overriding obligation to maintain a safe workplace and comply with all relevant laws, immediately cease all Work under the Alliance and/or take such other action as directed in the Notice of Termination If requested to in writing by Transit, the Other Alliance Participants will execute and deliver to Transit all required documents and take all steps necessary to vest in Transit the rights and benefits, future duties and obligations of OAP1/OAP2 under existing agreements related to the Project between OAP1/OAP2 and their Subcontractors and Suppliers Transit s obligations to pay The PAB will determine the amounts to be paid to the Other Alliance Participants in the event of a termination under clause 22.1 subject to the following guiding principles: a OAP1/OAP2 will each receive fair compensation consistent with the terms of compensation in Schedule 7 for all Work under the Alliance actually carried out and liabilities incurred in respect of the Work under the Alliance, including: i Net Cost (limb 1, Fee (limb 2 and gain/pain share (limb 3 payable in accordance with Schedule 7, for all Work under the Alliance executed prior to the date of termination; ii the cost of Materials reasonably ordered by OAP1/OAP2 which OAP1/OAP2 are legally liable to accept, but only if the Materials become the property of Transit upon payment; iii costs and liabilities reasonably and properly incurred by OAP1/OAP2 prior to the date of termination in the expectation of completing the whole of the Alliance Works; iv reasonable demobilisation costs; v reasonable costs of complying with any directions given by Transit upon or subsequent to termination. b OAP1/OAP2 will not recover any Fee or suffer penalty in respect of that portion of the Alliance Works which does not get completed as a result of the termination The Other Alliance Participants will be entitled to submit an invoice to Transit for the amount determined by the PAB pursuant to clause and Transit must pay OAP1/OAP2 that amount within 30 days of receiving the invoice Transit s right to continue project If Transit terminates the Work under the Alliance pursuant to clause 22.1 Transit will have the right to complete the Work under the Alliance itself or contract with other persons or companies to complete the Work under the Alliance. D4-FD-PAA-Trial 4 Page PAA 23 Printed: 25/02/2009