Delay Analysis.pdf

7/28/2019 Delay Analysis.pdf

1/6

Delav Analvsis with Respect to Concurrent DelavsWhat is a Delay?ln Construction lndustry, "Delay" means the incident which some part of the project has beenextended beyond what was originally planned due to unexpected situations. lt will affect theperfoi'mance of a particular project activity, with or without affecting the project completion.These delays not only increase the time period to perform the work but may also increase the costfor many of'the parties involved. This will vary by the causes for the delay.Delay may be caused by the one or more of the following parties;o Owner and his team

l.--Nature (i.e. cause {.1"i.-" *:ll_!&tvoelo Societyjhrough some changes in statutes,,/ ,?,' politicdl nature/{eY-lo, : :t f) :\"'{oTypes of DelaysDelays can be categorized into four major types.o Excusable or Non-Excusable. Compensable or Non-Compensableo Critical or Non-Critical

,a/ L" ; ri,by laws, etc or thrdugh its impact of socio-

Excusable or Non-Excusable DelaysExcusable DelavsThese delays are beyond the control and without the fault or negligence of the contractor and alsothey are unforeseeable. Common excusable delays for a contractor include design problems,unanticipated weather, acts of God, differing site conditions, variations, material limitations, delaysin approvals and etc. For these delays contractor shall have the right to claim extension of time andpotential financial entitlement depending on contractual clrcumstances.Non-Excusable DelaysThese delays are foreseeable and within the contractor's control. Here contractor shall have noright to claim neither extension of time nor financial entitlement. This also called as "culpabledelays". This includes mismanagement, insufficient labour, plant and equipment, delays in shopdrawing submissions and etc.The contractor shall be liable for the damages resulting from late completion as stipulated underthe contract, or he shall pay for acceleration damages to make up the lost time to the client.

Page 1


2/6

3

Compansable or Non-Compensable DelaysExcusable delays further can be divided into two categories as compensable and non compensabledelays.Compensable DelavsCompensable delay means, contractor is entitled financial recovery in the form of direct andindirect time related costs arising from the client's fault. lf the delay is an excusable andcompensahfi d.lry, then the contractor is entitled to the both extension of time and cost i.e'overhead and profit. Causes for this delay can be design changes, variations, delay in approvals andetc. However it is possible for a delay to be compensable without extending the agreedconstruction Period.Non-Compensable DelavsNon-Compensable Delays are the delays which the contractor is entitled to a time extension and heis not entitled to any additional monetary compensation. This delays mainly borne by the acts ofGod, riots, strikes and etc which are beyond the control of the both parties and also unforeseeable.But the original construction period to be extended and then the contractor automatically entitledto the extension of time.Critical or Non-Critical DelaYs"'-.,CritiCat Celays mean,the,-'ddlaysironiprogress of any activity on a ffitical path which"c'a,uses''to:t'tne,delay to overall project completion. Non-critical delay means a delay of an activity which is not inthe critical path.

Concurrent DelaYsconcurrent delays are generally defined as parallel and independent delays to the critical path on aproject during the same time period. When there is a concurrent delay and one is an employer riskevent and other one is contractor risk event, then generally contractor is entitled to the extensionof time.

ERE - Employer Risk Element CRE - Contractor Risk Element

SummarvTvoe of event ERE CRE Both ERE and CRE

Excusable a aNon-Excusable aCompensable aNon-Compensable o a

PageZ


3/6

Concurrent Delay AnalysisThere are two parts to delay analysis by reviewing the effect on progress sustained by a delay eventand they are as follows;. assessment of the time extension.. assessment of the financial compensation.Delay analysis will vary from the normal when there are concurrent delay events. lf it is so, firsthave to identify the occurrence of the delays from as-built data and from that analyst canunderstand whether the delays have affected the existing completion date and the liability for eachdelay. ',There are number of alternative methods to analyze the concurrent delays. Selection of theappropriate method will be based upon the contract conditions, prevailing case laws, preference ofthe analyst and the nature of the concurrent delay. Concurrent delay analysis methods are asfollows;o Dorninant Cause Approacho But For Testo First Past the Posto Common Sense Test

Dom inant Cause ApproachWhere there are two causes of delay, one is from the contractor and the other one is from theemployer, the party who can convince will succeed, that the cause for which the other party isresponsible, is the effective dominant cause.

Case LawH Foirweother & Compony Ltd vs. London Borough of WondsworthHere, the Contractor had suffered a delayatthe outset by reason of variations and late instructions

entitled him to an extension of time. Thereafter a strike occurred which caused a further 81/weekj delay. The Contractor's case was that the delay caused by the strike was ignored by the',s*4-,'delay caused by the Employer. The arbitrator rejected the Contractor's case on that point, holdingthat the strike was the dominant caus_e. Judge allowed the Contractor's appeal and remitted the4.relevant part of th( award,'tolthe arbitrator. j1_- .___!f:... .

i3

Page 3


4/6

But For TestThe "but for" test is another major approach to concurrent delay analysis. lt is very popular due toits simplicity and it is also known as "collapsed as-built schedule method". Under this method, takethe as-built schedule and identify the impacts of delays caused by contractor and employer andthen removes one party responsible delay causes. Then consider the possibility to the delay being acontractor responsible or employer responsible. Then do the vise-versa.Anatysis Process for the "but-for" technique

A - As-built schedule

Owne/s view Contractor's view_;

Nocompensabledelay forowner

ExampleThere are two concurrent delay events as labour shortage from the contractor for one week andadverse climatic condition in the same week. Then the original completion date will be extended byone week due to above both causes. The delay can be analyzed by using the "but for test".First remove the shortage of labour and see the effect. Then the work will be delayed even by theadverse weather condition. When the adverse weather condition remoVed, then also the work willbe delayed by the labour shortage. The removal of either event from the circumstances leads tothe conclusion that the delay would still have occurred. Both events independently have causedthe same delay, the extra wee(1???????????????-i'\\_


5/6

First Past the Post MethodThe term "first past the post" came into practice as where the winner of a race is the first to pass aparticular point on the track. This approach is based on the logic that where delays are in parallel,the cause of delay that occurs first in terms of time will be used first to evaluate the impact ondelay to the existing time for completion. Other causes of delay will be ignored and when the othercause of delay will continue on after the first cause also then the later part of the second delay willbe used with the first delay to calculate the extension of time.The mairr weakness of this approach is that it does not provide solutions for a situation where allthe delays begin at the same time.Example

.] ffi EventAffi EventB Event AII Event B'K-_}r?iScenario 1 Scenario 2ln the scenario L, Event A is the first occurred event and it is the one which used to evaluate theextension of time. Event B will be ignored.ln the scenario 2, again Event A is the first event which uses to evaluate. When consider the EventB', it is continuing after the first cause finish and then "a" part only will be considered with the firstEvent A to evaluate the extension of time.

Common Sense TestAs the construction claims are unique, courts are likely to rely on the factual issue of causation byapplying common sense to the facts of each particular case. ln this test, common sense of theexperts who are involved in analyzing claims is used to analyze the construction delay claims.Experience of those experts is very important to achieve accurate solutions at the end of the delayanalysis for a particular event.But this method is not good as far as it seems to be, because two experts may think in differentangles for a same problem and as a result of that they may give entirely different solutions to asame problem.

Page 5


6/6

Case LawsThiess wotkins white construction Ltd vs. commonweatth (lgg2) cose.ere the Employer caused delay of 5 Days commencing on day 15 means that a contractor whichould have completed the works on day 20, sti, hr, ; ;;, work to do. And arso there is a neutralelay on day 23' lt was decided that no difficurty in concruding that the time based costs incurredn day 23 were caused by the original delay. rhe decision is an extension of time craimed by the.:TJ::H;::il: :il"";"rlr- .i" r,rr period or o oays, even though thar day 23is the second

Armstrong Construction vs. councir of the shire of cook (Lss4) case.n this case' contiactor initially encountered a delay caused by latent condition and thereafter adelay due to wet weather which is a neutral deray. rt is considered that the contractor was entitred;; ilff"T.t#',I# delav and disruption arising from the first detay event but not for the causedffI,Iff,:1:[i:,:::,..:,,?,,,:dges have used the common sense test and given opposite

Page 6

Documents

Delay Analysis.pdf