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CONCURRENT-ENTITLEMENT FOR PROLONGATION COST

1 reply [Last post]
Tue, 2007-05-08 15:33
prabu deva
User offline. Last seen 13 years 25 weeks ago. Offline
Joined: 31 Jan 2007
Posts: 8
Groups: None
THE CONTRACTOR IS DELAYED SAY 10 MONTHS TO THE PROJECT COMPLETION DATE, WHILE THE CONTRACTOR IS IN DELAY THE CLIENT ISSUES A VARIATION ,WHICH ALSO REQUIRES 10 MONTHS TO COMPLETE.( FORECAST PROJECT COMPLETION DUE TO CONTRACTORS DELAY AS WELL AS THE VARIATION IS SAME)

CAN THE CLIENT GIVE THE CONTRACTOR EOT WITHOUT PROLONGATION COSTS,SINCE THE CONTRACTOR IS DELAYED IN ANY CASE

CASE-2 CLIENT INSTRUCTION REQUIRES EXTENDING CONTRACT BY 15 MONTHS,CONTRACTOR IS DELAYED SAY 10 MONTHS,WHAT IS THE CONTRACTORS ENTITLEMENT


CASE-3 CLIENT INSTRUCTION CAUSES DELAY TO THE PROJECT BY 3 MONTHS,CONTRACTOR CONCURRENT DELAY IS 10 MONTHS,CAN THE CONTRACTOR ESCAPE FROM BEING PENALISED FOR THE CLIENTS CONCURRENT DELAY OF 3 MONTHS
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Replies

Wed, 2007-05-09 00:50
#1
Ashraf Jahangeer
User offline. Last seen 8 years 29 weeks ago. Offline
Joined: 8 May 2007
Posts: 144
Groups: Petro-Chem / Oil & Gas
Hi Prabhu,

We encountered the same on one of our project. The delay was analysed carefully and it was ascertained that the delay caused by company variation is critical hence the contractor was given extension as the completion was shifted from March to December the Liquidity damages were waived out for that period.

However it was not a blank check for him and the extension of time claims of the contractor was reviewed and he was compensated for the only the necessary manpower which he needs to retain for company variation.

This was easier said than done and as you pointed out the finalization of variation in our case also took six months and a lot of trade-off was done. However as the company fairplay should be name of the game.

Regards,

Ashraf
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