The following questions were answered by Steering Committee member, Lee Sporle during Construction Clinic 11, recorded on 9 June 2020. The responses have been summarized from the original. The entire webinar may be viewed on-demand on YouTube.

Question 1

Question: We have a project timeline from January 2020 to July 2020. By March 2020, the project was running behind schedule by 60 days and we had an extension for 30 days. Our revised programme was submitted with a cut-off date in March 2020 and the new completion date set to August 2020 instead of July 2020, and the Contractor recovered his 30 days delay.

We have another claim event started just after the data date of March 2020. Which version of programme update do we use to analyse the delay using the TIA method: the revised programme, which the Contractor has delayed due to the recovery made, or the normal update on the baseline programme, the revised programme, which shows the real Contractor delay at this time?

Answer: OK. So, the delay has cost 30 days and you’ve got an extension for that. You were forecasting an additional 30 days, but you’ve mitigated that 30 days of potential delay. The revised programme is the programme you’re going to use going forward.

If that programme was unachievable, then you shouldn’t have issued it. You’ve issued a revised programme that you’ve said you can complete. You’ve mitigated that other 30 days and you are going to complete the 30 days of EOT.

Now, that programme is the basis for any future delays and progressing. The revised programme should be the normal update from now on. There should be no other programme. In answer to the question of which programme to use, you use that revised programme going forward.

And make sure you can complete by that time. If you can’t achieve that, make the programme show when you can complete.

Question 2

Question: The Client issued a site instruction for additional works. The contract’s original finish time was the 16th of March. The variation order was issued at the end of February and the details were issued by the client on the 3rd of March (13 days before completion). We submitted our revised programme calculations and shop drawings on the 15th of March and asked for a time extension of 35 days. Later, the Client issued the extension of time, but then later rejected to pay the Contractor’s associated amount.

The Client issued the variation of the details not in a reasonable time. Please advise.

Answer: There are some missing details here, but I’ll try and answer based on what you’ve given.

What does the contract state, in terms of time and cost and EOTs? What was the reasoning the Client or the Engineer gave for rejecting the costs? You state the Client issued the extension of time and later on rejected it. Was that after the 35 days? When did you actually finish the contract? Have any damages been applied?

In terms of the variation order that was issued on the 3rd of March, would you have completed by the 16th of March without that variation? If so, then it’s quite clear that that variation would have delayed the works. So, you should be entitled to time and relief from damages.

Again, it depends what that event was and whether you were going to complete on time. If you weren’t going to complete by the 16th of March and a variation order came, then the client rejecting your costs, it looks like there could be a concurrency use here for defending the cost to be paid.

So, if you were going to be late on the project, and the Engineer gives a variation, which is additional time, but it’s absorbed within the period of time you’re going to complete the works by, the Engineer has been reasonable to you by saying, ‘OK, I will call it concurrency, so you can have the thirty-five days extension of time, but no cost because you were going to be late, anyway.’

You would have to carry out a full analysis to see how that worked.

A final point on that, you state the VO was not issued in a reasonable time. According to FIDIC 1999 Sub-clause 13.1 (Right to Vary), variations may be initiated at any time prior to the taking over certificate. You didn’t have the taking over certificate and a variation was issued. So that is a reasonable time. If it affects the work, then you could say it’s not reasonable because you now can’t complete the works.

If the client then gives you an extension of time, why is it not reasonable? For that reason, I do not think saying it wasn’t reasonable time is going to be a good argument.

I would need more details to give a more complete answer, but I hope this answers your question.

The questions covered in this blog were answered by Lee Sporle

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