Octavian Dan - fidic.org Dan_Time Delay Expert_0.pdfFIDIC 2017 - Modifications to clauses related to delay claims Entitlement to EOT - extended to additional items:-Access Route (Cl.4.15)

Octavian Dan

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

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

FIDIC 2017 - 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.20.2.2). Justification and supporting evidence is to be provided with the Fully detailed Claim (Cl.20.2.4) within 84 days (or other period agreed) of being aware (or should have been aware) of the event or circumstance.


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


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.


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”.

Concurrent Delays

Concurrency - principles

Three commonly recognised approaches for dealing with the time aspects of concurrency:

The first-in-lineThe dominant cause approachThe apportionment approach

The choice of approach will depend on the circumstances:The contract conditionsThe prevailing case lawThe context, the pragmatism and common sense


Scenario


First-In-Line (Scenario 1)


Dominant Cause (Scenario 2)


Apportionment (Scenario 3)



EVENT 1 – NO DELAY TO COMPLETION


EVENT 1 – CRITICAL PATH UNCHANGED


EVENT 2 - NO DELAY TO COMPLETION, CRITICAL PATH UNCHANGED


EVENT 3 – DELAY TO START OF TASK 3


EVENT 3 - NO DELAY TO COMPLETION, CRITICAL PATH UNCHANGED


EVENT 4 – CASCADING EFFECT TO TASK 3 AND TASK 4


EVENT 4 - CRITICAL DELAY TO COMPLETION WITH CHANGE OF CRITICAL PATH

Setting up the delay analysis programme – principles

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.


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)


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.

Delay analysis – choices and methodology

AACE International Recommended Practice No. 29R-03 FORENSIC SCHEDULE ANALYSIS

Table 1 – Nomenclature correspondence (commonly names for classification)

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

Delay analysis – IMPACTED AS-PLANNED

IMPACTED AS PLANNED ANALYSIS

As Planned programme (logic linked) Impact Event 1 on the As Planned programme


Reschedule after Event 1 – identification of delay 1 Impact Event 2 on the previous programme


ADVANTAGES

1) Simple, based on the As Planned programme with critical path2) Easy to understand and communicate3) No need of As Built programme (only relevant data for the events impacted)4) Quick to implement5) Method widely used by Contractors

DISADVANTAGES

1) The Baseline is usually irrelevant after the first update2) Difficult to demonstrate acceleration, mitigation and/or concurrency3) Needs to impact separately the Contractor events and the Employer events4) Almost no judicial support, weak results (theoretical conclusions)5) Ignores actual progress

Reschedule after Event 2 – identification of delay 2

Delay analysis – TIME IMPACT

TIME IMPACT ANALYSIS

As Planned programme (logic linked) Update progress before Event 1 & reschedule


Impact Event 1 into the activity network Reschedule after Event 1 = Delay 1


Update progress & reschedule before Event 2 = no delay Impact Event 2 into the activity network


Reschedule after Event 2 = Delay 2

ADVANTAGES

1) Simple, based on the As Planned programme with critical path2) Easy to understand and communicate3) Can demonstrate acceleration, mitigation and/or concurrency4) Relies on the actual progress of the works5) Method widely used by Contractors, sometimes recognised by the Courts

DISADVANTAGES

1) Requires a robust/ correct Baseline programme2) Time consuming, especially on complex projects3) When used prospectively, can predict only the likely effect of events4) Can generate theoretical conclusions if as built data is insufficient5) Expensive to produce, relies on programming skills and experience

Delay analysis – TIME SLICE WINDOWS

TIME SLICE WINDOW ANALYSIS

As Planned programme (logic linked) Update progress at Window 1 date


Reschedule at Window 1 date – identify delay at W1 Update progress at Window 2 date


Reschedule at Window 2 date – identify delay at W2 Update progress at Window 3 date


Reschedule at Window 3 date – identify any delay Update progress at Window 4 date


Reschedule at Window 4 date – identify delay at W4

ADVANTAGES

1) Simple, based on the As Planned programme with critical path2) Easy to understand and communicate3) Can demonstrate acceleration, mitigation and/or concurrency4) Takes into consideration the actual progress of the works5) Method widely used by Contractors.

DISADVANTAGES

1) Requires a robust/ correct Baseline programme2) Requires accurate As Built information3) Difficulties when applied to sequences of work which are different from the planned intentions4) Can generate theoretical conclusions if as built data is insufficient5) Not suitable for complex projects with multiple planned critical paths

Delay analysis – COLLAPSED AS-BUILT

COLLAPSED AS BUILT ANALYSIS

As Built programme (without logic links) Reconstructed (Analogous) As Built logic


Identification of Events 1 and 2 (as built data) Collapse Event 2 (zero duration)


Reschedule to identify the effect of collapsing Event 2 Collapse Event 1 (zero duration)


Reschedule to identify the effect of collapsing Event 1

ADVANTAGES

1) The concept is simple, easy to understand2) Does not need an As Planned programme3) Relies upon the actual progress of the works4) Based on records of actual events5) No requirement to demonstrate the reasonableness of the baseline programme

DISADVANTAGES

1) Subjective reconstruction of the Analogous (As Built) critical path2) Very difficult to assess acceleration and/or mitigation measures implemented during the works 3) The programme/ progress updates during the works are ignored4) Requires accurate As Built information5) Requires hand-on experience in preparing the analysis

CONCLUSIONS

RECCOMENDATIONS FOR MAKING AND PRESENTING DELAY CLAIMS

Consideration of specific Contract requirementsConsideration of the balance between the costs to produce a delay claim and the magnitude of the disputeAgreement on the Baseline programme and subsequent updates of the sameAgreement on the method of delay analysis to be appliedTreatment 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 jargonDemonstrate that the results are grounded in common sense

THANK YOU

Documents

Octavian Dan - fidic.org Dan_Time Delay Expert_0.pdfFIDIC 2017 - Modifications to clauses related to delay claims Entitlement to EOT - extended to additional items:-Access Route (Cl.4.15)