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Some very basic questions about delay claims

2 replies [Last post]
Sat, 2009-01-03 11:38
mimoune djouallah
User offline. Last seen 5 years 18 weeks ago. Offline
Joined: 14 Oct 2006
Posts: 388
Groups: Petro-Chem / Oil & Gas, Spider Project Team
Some very basic questions about delay claims

Just one month after the project start and we are already late, as we did not planned a time for mobilization, so we started the project 1 month after the contract was signed.
In the contract, we have some 10 global milestones to respect (mechanical work, piping, power generator erection etc….)
- As I am sure that we will not finish the project in time, does the client base his delay claims only on the end of contract, or he can say that we did not ended that particular milestone in time?

- When the delay is the fault of the client, like civil work not done in time, or equipment not arrived on the project, should we inform the client in time or wait till the end of contract before asking for EOT ( extension of time, not sure it is the exacts word)

- what is the best time to send the client, the updated baseline ( using actual start of activities ) ?

Thanks, and sorry for asking Metaquestions

Mimoune
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Replies

Fri, 2009-01-09 03:13
#1
Mike Testro
User offline. Last seen 36 weeks 13 hours ago. Offline
Joined: 14 Dec 2005
Posts: 4418
Groups: Building Information Modelling, Content Moderators, GPCCAR Editors
Hi Mimmoune

Samer is giving you good advice - I would just like to add a few things.

Do your milestones have seperate Liquidated and Ascertained Damages (LAD’s) attached to them or is there only one at the end?

The employer can only start deducting LAD’s when you have not completed a section by the contract date.

Your late start will be reflected in your regular progress update - make sure your drop down line is straight and not jagged.

If the contractor caused the delays then you can look at ways to speed up. Overtime working is on way but you have to balance the costs against potential damages.

Delays due to the Employers interface works have to be reported immediately they start.

For instance if the Employer is responsible for pipeline bases before you can lay your pipes then you have a date on your programme that cannot be exceeded - after taking into account any available float.

If you are approaching that date and it is obvious that it is not going to be achieved you must send a delay notice at once.

Move the interface date every week and keep reporting the delay effect until the bases have been completed.

Best Regards

Mike Testro
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Sat, 2009-01-03 14:36
#2
Samer Zawaydeh
User offline. Last seen 5 years 38 weeks ago. Offline
Joined: 3 Aug 2008
Posts: 1664
Groups: Civil Engineering, Regional Representatives
Dear Mimoune,
The best way to learn is to ask questions and learn from people working in the same files.

Answer 1: read the contract well and check under which conditions you can ask for extension of time. You assumed that you will not finish on time based on the late ending of mobilization. Ask you Construction Manager to think of ways to reduce this delay. It is known to work :) in many cases, that a late start can end in On Time delivery.

Answer 2: Always monitor your activities and send the client notice when it starts. The best way is to support it with "Inspection Reports" signed by the Engineer.

Answer 2a: If the Client delayed you because of late arrival of his equipment, etc, then you need to do a "Delay Analysis" and confirm that this delay led to the delay of the Critical Activities and overall delay of the project.

Answer 3: Updating the program of works should be done on a periodic basis. If your project is under FIDIC clauses, then you have to submit your monthly report within 7 days from the start of each month with a detailed progress summary. Hence, you will need the update.

Hope that you will benefit from the answers.

Best Regards,

Samer
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