1) The disclaimer does not work. He has given you information which you have used to give him a lower price. Having obtained the lower price he cannot take it away. (I have told you but i did not say it)
2) It contradicts with the constarctor's responsibilities to examine etc, as far as "practical" given "time and cost" at the tender stage.
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Submitted by Bryan Russell on Tue, 2006-01-24 06:16
I assume you are on FIDIC 4th ed by the reference to Sub-Clause 12.2 ; if so, a day is defined in Sub-Clause 1.1 g ii as a calendar day. Most Conditions of Contract have definitions near the front
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Submitted by Shahzad Munawar on Fri, 2005-12-23 08:22
The Extension of Time, you have granted is within your Contractual limitations not beyond thereof.
Ronald :
111 days of compensable overhead expenses depend upon what the Contract says in this respect that whether the said compensation is admissible under EOT Clause or not.
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Submitted by Ronald Winter on Tue, 2005-12-20 10:09
Thanks for all your advice. Got 124 days extension. 111 days for unforeseen soil and 13 days for extremely adverse weather.
I would like to pose a question. What is the normal practise to calculate the new completion date?
The original completion date was supposed to be 31st December 2005. If we just consider 124 days, that will bring the new completion date to 3rd May 2006.
The question is should the 124 days include Sundays and public holidays?
21 working days for Jan (5 sundays and 6 public holidays)
24 working days for Feb (4 sundays)
27 working days for Mar (4 sundays)
24 working days for Apr (5 sundays and 1 public holiday)
25 working days for May (4 sundays and 2 public holidays)
3 remaining days for Jun (1 sunday and 1 public holiday)
Total = 124 days
Does this mean that the actual completion date should be 5th June 2006 instead of 3rd May 2006?
I agree with your thoughts and would fully expect the CRE to go to ground and dig his heels in - human nature Im afraid. A certain amount of pressure has to brought to bear though and the contractors case proven in order for the CRE to be prepared to consider his position, or as you suggest find a way round it. The EoT is important to get as is the cost of any rework.
Id still maintain the contractor giving him abit of a beating along the lines Ive suggested and see what he does. The next tactical step, assuming he does as predicted and dives for cover, is to write him a letter that he cant answer himself (or would be very foolish to attempt to) and therefore to force him to pass the issue on to someone who will gather all the information and come to an informed decision!
I think that Andrew is right in regard to the motives of the Engineer in hiding behind the disclaimer. I have experience of this in the past, where the Engineer’s company had also carried out a Site investigation that turned out be defective once the ground was excavated.
It takes time, but eventually the Engineer has to accept the inevitable!
I don’t agree that an ‘escape route’ has to be found, though I am fully aware of the cultural sensitivities in this regard from your neck of the woods!! ;-) Indeed, I have found in the past that the wording of the Conditions of Contract (in this case Sub-Clause 12.2) can be used as a face-saving device behind which the Engineer can hide. However, if he chooses not to use this camouflage, then I don’t think hat the Contractor is obliged to give him a fig leaf!!
I am not sure that a nod and a wink will work in this case; I would simply ask the Engineer where in the Contract it is stated that the Contractor is required to take on the responsibility and liability for the accuracy of the original Site Investigation! It is certainly not to be found in the Conditions of Contract (indeed, it states the opposite) and it is not included in the disclaimer!!
We are not going after the CRE, just trying to force him to make an independant, resonable and fair decision on the situation, as is his job to do so. Hes chosen to take the position of hiding behind the disclaimer for what ever reason - most likely he wants to cover his companies position and or look good to the Employer. He therefore needs reminding of this duty to assess events impartialy taking in all circumstances which prevail. ie bottom line - I just want him to do his job properly.
Going for the tender SI company (which may be the same as the CREs company) is a long shot - no direct contract and I bet theres a large disclaimer somewhere in the report. You would have to prove negligence and this is actually quite hard to do. Also, and most importantly, its not going to get the Contractor an EoT for the extra work.
If the CRE, and its his choice, the Contractor will only react to his actions, wishes to maintain his position then the thumb screws must be used on him. Sorry but thats the way of the world.
Thanks for your contribution. I am sorry that my earlier statement was unclear. I have mentioned that piling works was remeasured and paid for. The piling works refered to RC piling works, not sheetpiling. The sheetpile cost is not payable. The cost have been worked into the earthwork excavation cost.
We are responsible for the temporary designs which were subsequently submitted fully endorsed by a PE. There was approval of the first design. However, no reply was received for the redesign.
During the first design, the RE actually interviewed the designer as to the parameters used in the design. All parameters used were counter-checked against the original SI. However, this event is unrecorded and the RE has left the project for greener pastures. ;-)
Now for the unanswered questions.
Valuation of the piles were not done as the rates in the BOQ is per meter driven and not by number of points. Therefore, only remeasurement is required. However, we have not considered the additional difficulty and cost of piling 1.5m above formation level, excavating the overburden between the piles and cutting of piles, casting of the base slab before proceeding with the piling works again for the next section.
During tender stage, an estimate was derived based on sheetpiles required and methods of supporting the sheetpiles. However, no design was ever produced during then. At that moment of time, considerations were made that piling was required for the structures involved.
Hope that helps
Regards
Darryl
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Submitted by Andrew Flowerdew on Fri, 2005-11-11 12:38
One further point in slight disagreement with Stuart - the Engineer is going to argue (or is arguing) that it the contractors responsibility to:
"inspect and examine the Site and its surroundings and shall satisfy himself before submitting his Tender as to the nature of the ground and sub-soil,"
Therefore the answer you need is one to this arguement and Stuart may be correct in that the above statement is inconsistent with other terms or conditions, the other term or condition taking precedent.
However, there is also however a general legal rule that specific clauses take precedent over general clauses and so the arguement goes on. Also which clause, if any, is a "condition" and which is a "warranty" and just to confuse everyone, the UK courts now use another term - an "innoculate" term, which sits somewhere between a "condition" and a "warranty". Please also dont get confused as "condition" used in this legal concept does not mean something contained in the "conditions of contract" document, but a term of significant importance to the contract irrespective of where it is to be found in the documents - one that goes to the "root of the contract" is often used to define a term or clause which is a "condition" as opposed to a term of clause which is a "warranty". Warranty being an obligation arising from the contract but not essential to it. "Conditions" take precedence over "warranties". And it doesnt stop there..
Confused!!!!!!!!!!
Now you know why I suggest avoiding the contractual arguements if its possible to get the Engineer to see your way of thinking some other way. The contractural route offers no guarantee of success without considerable more thought.
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Submitted by Andrew Flowerdew on Fri, 2005-11-11 12:01
Im from a contracting background so I would like to agree but on occassions that "half-arsed attempt to block the Contractor’s due entitlement in a lower level priority backwater clause." has managed on the facts put in front of a judge to do just that.
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Submitted by Andrew Flowerdew on Fri, 2005-11-11 11:50
Cant fault Stuart in his thoughts. I would however try and keep it as simple as possible to start with and see how the Engineer reacts.
The road of contractual arguement is normally long and winding, (and if it goes to dispute resolution, expensive) so if you can get a result by other means then try that way first.
My hunch is you will actually end up arguing over contractual terms, (just the way it often goes especially if theres alot of money involved) so keep Stuarts advise very much in mind and spend some time putting events in date order and thinking about thier possible significance, especially anything that could amount to an Engineers instruction.
I accept that the principle argument of the CRE is that the Contractor is not entitled to rely on the soils info given at tender. However, I don’t accept that that is what drives the Contractor’s entitlement.
I believe that the Contractor’s entitlement is driven by Clause 12.2 of FIDIC, and that this is not diminished by a half-arsed attempt to block the Contractor’s due entitlement in a lower level priority backwater clause. True, it does mean another hurdle for Darryl to overcome, but in my view, it does not remove his entitlement. Nor does it impose the responsibility for the Site Investigation upon the Contractor. (Does ask me where that responsibility lies – probably covered in soft clay – but contra proferentem bells are ringing!!)
Thanks for the added info, which – as Andrew correctly notes – does seem to paint you into a corner!! ;-(.
However, I think Andrew is right in seeing a chink of light in the third letter, and by the time you get to the end of this post, I hope there is a bit more light!!
If the third letter can be construed as an instruction to follow the contents of the Soil Report, in full or in part, then there may be some relief there. Also, at what point in the schedule was the notification of soft clay made?
The reference to the Site Investigation is contained in the General Section of the Specification, which I suggest is lower down the document priority list than the Conditions of Contract. The disclaimer to some degree appears to makes the original Site Investigation Report almost worthless in terms of its usefulness to the Contractor.
You therefore need to open up the discussion a bit:
Was it reasonable for the general site area to contain soft clay material?
Is the general area of the site prone to substantial areas of soft clay material?
Based on the topography of the ground, was it reasonable to anticipate the existence of soft clay material?
Is the Contractor a local contractor who, by virtue of his extensive local knowledge, should reasonably have expected there to be soft clay material?
Has soft clay material been prevalent in other deep foundations within the vicinity?
If the answers are: no, no, no, no and no, then I think that you may have passed the test as required by Sub-Clause 12.2 of FIDIC.
Let us look closely at the disclaimer.
In the disclaimer, the Employer does not guarantee the accuracy of the data in his Site Investigation; nor does he guarantee that the data is typical of the ground conditions to be encountered. By the same token, the disclaimer, in my view, does not require the Contractor to accept responsibility for the accuracy of the data in the Site Investigation; it merely confirms that the Employer does not accept the responsibility but that responsibility is not specifically imposed upon or accepted by the Contractor.
The disclaimer then goes on to confirm that the Contractor must do this, that and the other in regard to satisfying himself as to his completeness of Tender, which will already have been covered by Sub-Clause 12.1 of FIDIC.
The disclaimer then attempts to block the Contractor from claiming “…for additional expenses the Contractor may incur on account of any unforeseen obstacle of whatever nature, over and above those which would have been incurred had the existence of the obstacle been known at the Tender stage.” Here is where I can see Darryl’s panic setting in.
However, I suggest that this part of the Specification is in contradiction to and inconsistent with the wording of Clause 12.2 of the General Conditions of Contract, which (all things being equal!!) will have a higher priority, and under which he is entitled to EOT and additional costs if he “…encounters physical obstructions or physical conditions…which…were, in his opinion, not foreseeable by an experienced contractor…”
I also quote the note to Sub-Clause 12.2 in the Guide to the use of FIDIC (at Page 61):
Quote: “In spite of the pre-tender investigations of the Site by the parties, the Contractor may encounter unforeseen physical obstructions or physical conditions. Sub-Clause 12.2 lays down the procedure to be applied to such situations.”
***Darryl, note that the Note from FIDIC states: "In spite of the pre-tender investigations of the Site...." !!!
From this, I don’t believe that Darryl should be locked out of his entitlement to submit a claim (note that Clause 12.2 refers to “…in his opinion…” ) or have it succeed. We could start another thread about unfair contract terms, but it is already late on Friday afternoon!! ;-)
Darryl, you should concentrate on the words of Clause 12.2, in that you are an experienced Contractor which has encountered unforeseeable ground conditions (so unforeseeable that the Engineer didn’t even expect them!), and don’t cloud the issue with whether you have or have not taken on the responsibility for the accuracy of the Site Investigation (which in my view, you have not taken on!!)
In conclusion, I leave you with the weekend thought that the Contractor has not taken on the contractual responsibility for the accuracy of the data in the original Site Investigation, and that as an experienced contractor (assuming that to be the case, of course!!!!!), he could not have been expected to anticipate the existence of soft clay as ultimately discovered, confirmed by the fact, inter alia, that no such extent and nature of soft clay was discernible from a reasonable interpretation of the Site Investigation data.
It may not be that bleak, just trying to make the point that it is in some circumstances the Contractors choice whether he relies on the SI data at tender - often a point not appreciated by people. Its often thought, the Engineer sent it as part of the tender so we can rely on it come what may - how wrong they are.
You dont say whether your letters were pre or post contract agreement.
Letter (iii) appears to be a good one - if it can be shown that the Engineer instructed you to rely on the borehole information, you may have him where it hurts most! Ouch!!!
One thing I didnt mention before is although this disclaimer exists, the contract has to be read as a whole. You also mentioned the clause was in the specification, not the conditions of contract. May or may not be of importance.
If it gets to the point of arguing contract conditions, read EVERYTHING and list ALL those clauses that may help your case AND ALL those that work against you. The most common mistake people make is jumping at one clause that helps them and hanging thier hat on that. You have to consider ALL the clauses, good or bad, and reconcile those that work against you before you can conclude whether your case is good or not.
I know the situation sounds bleak. However, i do have several corespondence which might help
i. notification of the discovery of soft clay
ii. request whether additional site investigation is required as such soft clay may cause severe settlement of the structures
iii. reply from consultant "the site investigation has already been carried by ****. Please refer to borehole 5, 6, and 8 in the report".
We went ahead with the site investigation at our own cost (naturally!) and due to the report, the temporary works was redesigned to minimise movement of sheetpile (as method employed was not suitable) and the piles were eventually reinstated.
Regards
Darryl
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Submitted by Andrew Flowerdew on Fri, 2005-11-11 08:51
The story goes something like this. Employer has a soils investigation carried out. Engineer sends report out with tenders as information available about the project. The soils report or tender documentation has a disclaimer in it saying it is only interpretive and can not be relied upon.
Contractor receives tender and soils report. The contractor reads soil report and disclaimer. (and if he missed the disclaimer its his fault) The contractor now has to decide to the extent he wishes to rely on the soils report. We all know in 99.9% of cases this will be 100% reliance but thats the contractors choice and risk. What he should do is evaluate the report, decide if there are any critical areas (eg like where he is going to support his temp works) and seek further information if he thinks it needed - this may be from the Employer or by his own additional SI.
Now, if for example, access for further SI is not available and he can not obtain further information then he has a good case for saying he had to rely on the original soils report. Alternatively, if the soils report is unambiguous, eg theres sand for 10m and the report could only be interpreted one way then if it turns out differently he has a good case for why he relied on the report. The contractor may also have expressly or impliedly indicated to the Engineer during the tender period that he has relied on the report or certain aspects of it and therefore the Engineer would most likely have to stand by this later as he had prior knowledge of the contractors intent.
Unfortunately you wont find much about this in books as every case depends on its own individual facts.
I could pick holes in the clause such as it refers only to restricting (but not barring) claims for obstacles and therefore differing soil condition claims are unrestricted etc.
I would still suggest that your best option is to use the position talked about earlier before going down the route of arguing the legal niceties, although be prepared for this as thats what it may come to.
This is the clause used for reference to the SI report in the General Specification
A soils investigation report is available as described in Section 02200. The report is indicative only of the conditions of various points within the Contract area. The Employer does not guarantee the accuracy of the data in the Report, nor does he guarantee it is typical of the ground conditions likely to be encountered. The Contractor shall inspect and examine the Site and its surroundings and shall satisfy himself before submitting his Tender as to the nature of the ground and sub-soil, the quantities and nature of the work and materials, tools and equipment necessary for the completion of the Works. No claim will be considered for additional expenses the Contractor may incur on account of any unforeseen obstacle of whatever nature, over and above those which would have been incurred had the existence of the obstacle been known at the Tender stage. Any excavations needed to determine the exact location, and levels, of obstacles shall be done by the Contractor. The Contractor shall obtain all further information required as to the risks, contingencies and other circumstances, which may influence or affect the execution of the Works and include the costs thereof in his Tender.
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Submitted by Andrew Flowerdew on Fri, 2005-11-11 08:07
The principle arguement of the CRE is that the contractor is not entitled to rely on the soils info given at tender. If that is the case, the contractors claim fails, if the CRE is wrong, then the contractors claim stands.
I agree the contractor should put in a claim, but until the above point is decided, I wouldnt hold my breath counting on the claim.
If the contractor is entitled then he can claim misrepresentation. Most soil reports Ive come across have a disclaimer buried in them somewhere and therefore Im not going to bet on the outcome of this without knowing more.
If the soils report was bound in the contract then it would be somewhat clearer but then I guess Darryl wouldnt be having the problem he is.
I used the word “probably” in reference to the likelihood of the Contractor being induced to rely upon the information. I stated categorically that he did rely upon the information (or at least that is my understanding from Darryl’s initial post).
In the absence of having seen anything to the contrary, such as reference to any particular exclusion of liability clause, I believe that the Contractor is entitled to recover his additional time and costs arising out of the defective SI Report.
Darryl originally posted his question not within the context of whether or not he was entitled to claim (indeed, his initial post confirms that he has already claimed), but he is looking for ways to counter the arguments of the (responsible??) CRE.
Your statement "is that the Contractor relied (and was probably induced to rely) upon the correctness of the contents of the SI Report." has one critical word in it - PROBABLY, and we dont the answer to that.
If he was entitled to rely, then everything else flows from that. If he wasnt, nothing flows from it and it fall down like a stack of cards.
Make sure that you also include for the additional time of having to re-engineer the entire Temporary Works; it isn’t just a case of additional on-site time for longer piles, but you need to re-cycle your engineering work, probably starting from [before] square one.
You gain even less if your claim isn’t robust!! ;-)
As Darryl pointed out in his original post, it doesn’t appear that the SI info was incorporated into the Contract documentation, but I think that is a moot point!! ;-)
What is more important, I suggest, is that the Contractor relied (and was probably induced to rely) upon the correctness of the contents of the SI Report.
Based on this reliance, the Contractor produced his Price and Schedule for carrying out the Works, including the time and cost of executing the subject Temporary Works.
During the progress of the Works, it later became evident that the SI information relied upon for the safe execution completion of the Temporary Works was defective.
Therefore, the Contractor should be entitled to claim for the additional costs and time incurred as a direct result of the defective SI Report.
I agree with you that the Contractor should go very hard against the CRE in this case; indeed I suspect that the CRE is bluffing and stalling for time! We don’t know if he is implicated in the defective information contained in the defective SI Report – I have been in situations before where the RE’s company screwed up the original SI Report and there was lots of eggs on faces!! ;-)
I agree with what you say Stuart but as is often the case when the soils investigation or the interpretation of it is wrong, the first thing the CRE tries to hide behind is that they dont warrant or guarantee the tender information to be correct. We all know the contractor relied upon it at tender and designed his temporary works accordingly. Was he entitled legally to rely on it is a different matter.
As the law stands (UK anyway) in general, is any representations made prior to the contract, if intended to be relied on and part of the contract, should be bound into the contract. Hence, soil reports, method statements, programmes, etc are not usually bound into the contract as if they are, they take on a completely different contractual meaning. To establish if the contractor could rely on the tender soils report and hence claim, you would have to have sight of all the tender correspondence associated with it and establish exactly what was said and done. Without that information youre guessing. And what the law in Malaysia is might be completely different. Certainly in the Middle East, the contract is the contract and nothing said or done prior to the contract counts for anything. And come to that, was the contract made in Malaysia or elsewhere, we do not know. Whos legal jurisdiction applies?
The actions of the CRE are pointers as to how he thinks - he certainly isnt going to stand by his own work or information so be warned. Thats one of the reasons I would go in very hard at this point - so that he thinks twice about similar tactics in the future. Unfortunately sometimes it has to be done.
Clive,
This is purely a case of reliance (or not) on tender soils information not bound into the contract. The change in design may help prove your case but is irrelevant to the core problem.
Firstly, CRE stands for Chief Resident Engineer. The project involves 5 sub-projects and each project is helmed by a Resident Engineer each.
The temporary works were designed based on the SI report with no provision for piling works to be done later. Excavation involved is approximately 8m deep and the SPT count is between 7 to 9 (Sandy). Upon completion of the additional SI, the SPT count was reduced to 0 - 3 (Soft Clay). Below the formation level of the structure, the SPT count was between 5 - 8 (Silty to Sandy) upto the depth of 21m. The new SI recorded 0 - 7 (Soft Clay).
Interestingly, i forgot to mention that the sheetpile actually failed on two counts. The anchor is selected due to friction between the anchor and sandy soil. Since soft clay is encountered, the anchor failed as no friction could be mobilized. The amount of anchors used doubled. A section of the sheetpiled wall actually tilted and moved horizontally thus requiring removal and repiling.
For your information, piling is remeasured and paid for.
Thanks for your help. I just realised that i have erred. Could actually gain approximately 2 months due to increase in pile depth. Just thought about it after reading through your contributions.
The Contractor’s remedy will be against the Party with whom he is in Contract, the Client or Employer.
The CRE (Client’s or Consultant Resident Engineer – not sure which terms are used in this instance!!) is the representative of the Client or Employer. So the CRE isn’t the one being ‘got at’; the Contractor will ‘go after’ the Client/Employer, but he has to communicate through the Engineer, as set out in Clause 2 of FIDIC.
This situation appears to revolve around the Contractor having been given important sub-soil information upon which he designed and constructed his Temporary Works. That sub-soil information appears to have been given to the Contractor by the Client/Employer (or his Representatives), but the information turns out to have been defective, because it failed to identify soft clay that in fact was present.
As a direct result of the failure of the identification of the sub-soil clay, the Contractor has suffered from additional costs and loss of time.
The CRE – probably feeling both foolish and defensive – has said that the Contractor should have foreseen the existence of the clay that was hidden underneath and that was not identified in the sub-soil information. My view is that if it was foreseeable by the Contractor (which I doubt is the case) why was it not equally foreseeable by the CRE?
In addition, I hold to the view that the Contractor is fully entitled to depend upon the information related to the sub-soil that was given to him at the time of tender; the Contractor had no reason to question the veracity of the sub-soil information, and he is entitled to rely upon the reasonable expectation that the sub-soil information was correct.
I would suggest that even if the SI Report was not incorporated into the Contract documentation, it still constitutes representation upon which the Contractor was entitled to rely, and use as a bona-fide basis for the design and construction of his Temporary Works.
In addition, the CRE now appears to consider that the Contractor should have foreseen that the location in question had soft clay. I would ask the CRE why, if this is the case, was it not equally foreseeable by the CRE? Many people forget that the construction process is a team, not an adversarial, process, so if it was foreseeable by the Contractor (which I don’t think it was!), then it must have been foreseeable by the CRE!
Back to the same old story - what did the contract have in it, not the tender. It is the contract agreement that is of importance.
If this does not have the piling in (which on what you say it didnt) then I would argue that thier change in design from tender to contract only reinforced your interpretation as to the prevailing ground conditions.
I would further argue that in ignoring the design engineers interpretaion if it was correct, amounted to a breach of duty of reasonable skill and care to the Employer and mention you hope thier Professional Indemnity insurance policy is fully paid up when the Employer finds out.
i. In the tender drawing, piling was required. The criteria was pile to length of 9m.
ii. When the construction drawing was issued, the piling works were removed.
iii. Upon noticing the soft clay, the engineer reinstated piling. The criteria was changed to pile to set.
The CRE for the project has acknowledged that it was a mistake to remove the piling. However, his interpretation of the above events is, it indicates that the design engineers has interpreted the si report correctly and the reinstatement of the piling works reinforced that.
He has informed that the reason for removal of the piling works was due to the engineers decision to reduce cost, thus replacing the pile with 600mm thick of crusher run or hardcore. We doubt that this is the case and suspect that he made up the story to support his interpretation... But that will be another story. ;p
Cheers
Darryl
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Submitted by Andrew Flowerdew on Thu, 2005-11-10 07:20
If the SI info was not incorporated into the contract then it may (or may not) only constitute a representation made prior to the contract (even though wrong) and hence the Engineer may be correct. Alternatively Stuarts thoughts are correct.
There is alot of case law on this subject and depending on the exact circumstances, the courts have supported both sides of the arguement. A definative yes or no answer isnt really possible without knowing more.
One general principle that may be of help is on the discovery of the actual ground conditions, did the Engineer revise the design due to the new information? If so then the ground conditions must have been unforeseeable otherwise a competent designer would have taken them into consideration and designed the works to suit. If the Engineer insists that its still unforeseeable then point out that you feel duty bound to tell your client that the Engineer has been potentially negligent in his design and that your client should claim the additional costs back from the Engineer. That often focuses the Engineers mind.
If no redesign was required then the Engineer has a pretty good arguement that the conditions were foreseeable and he took them into account in his design - even if he didnt foresee them but how are you going to prove that!
I would try this first Darryl with regard the reintroduction of the piling etc and leave the reliance issue on tender information, if required, for later.
Is there any literature for reference where upon arbitration, the contractor is entitled to claims and extension of time due to unforeseen ground condition?
This will definitely help.
Thanks
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Submitted by Jihad Daniel on Thu, 2005-11-10 06:18
This is a common problem where the Consultant states that as an experienced contractor, you should have studied, checked and examined the site conditions, etc. and the Contractors statement that he received in the tender stage S.I. report for information only and that these geological conditions were unforeseen and unpredicted...
I can tell you this: For many years, several forms of interpretive geotechnical reports have been incorporated into the Contract Documents for underground construction projects. It is now recommended that the Geotechnical Baseline Reports (GBR) be the interpretive report included in the Contract Documents. Its primary purpose is to establish a contractual statement of the geotechnical conditions anticipated to be encountered during underground and subsurface construction. This guideline and practice manual is intended to serve as a reference for preparers and users of GBR, and to inform owners of the importance of the contents of the GBR as related to the allocation of financial risk. In order to do this, it provides a checklist of items to consider when preparing the GBR, recommendations for the content and wording, and presents examples of problematic and improved practice in stating baselines. The question is: does this S.I. report provided to you for information, was detailed and gave sufficient/accurate information as it should be a real GBR?
The owner defines his expectations by a functional description of the project, a GBR on the basis of a
geotechnical database (GDB) that is as independent as possible from the construction method. Furthermore, he informs the bidders of the qualitative results of his risk analysis and on that basis defines the financial limit to which prospective bidders have to bear risk.The Maximum Bidders Responsibility (MBR) represents the financial limit from which it is the owner who will bear the costs caused by the geology. But below that, the contractor is responsible for his expectations to the geology, i.e., the competitive tender remains effective up to the MBR.
Therefore, this depends on the Clarification Meetings made in tender stage, type of contract (Lumpsum, BOT, etc.),risk analysis of your company and uplift/overhead put to account for geology factors, etc.
Also, when these unforeseen conditions occured, the Owner/Consultant/Contractor should surely agree on overcoming these conditions. Usually, the Contractor will be instructed to assign a third party to investigate the soil and propose an adequate system which will be approved by the Designer/Consultant before proceeding work. In this stage, the Contractors planner should revise the program of work, putting in his schedule these unforeseen site conditions, extra site reports needed in particular areas, adequate system agreed upon (boreholes, piling, nailing, etc.) and submit in a short time the revised schedule with the new completion date to the Consultant for his review and consent...
You should keep in mind that the Contractor is entitled to rely upon the accuracy of any information that is provided to him as part of the tender (or related) documents, even though that information is not part of the Contract documents.
Therefore, if the Contractor has acted in all good faith and assuming that he has properly interpretated the Site Investigation data made available to him, then he should be in the clear. There is not an obligation on the Contractor to re-do the original SI nor verify it; nor should he be expected to assume that the original SI was defective (as it clearly was!)
Clause 12.2 of FIDIC allows an EOT claim where the Contractor encounters physical conditions that were not foreseeable by an experienced Contractor. In being supplied with a SI at the time of tender, which the Contractor was entitled to believe and upon which he was entitled to use as a basis for the design of his temporary works, the SI sets out the broad nature and extent of the foreseeable ground conditions.
If reality proves to be otherwise, then the original SI is clearly at fault, then the Contractor should be entitled to the additional costs and time that flow from the defective SI.
Under FIDIC (and most other Forms of Contract) the Contractor cannot be expected to assume the risk and responsibility for the correctness of a SI at tender stage (unless the Contract specifically enforces this obligation on him, and in such a case the Contractor must be given the opportunity to verify the original SI).
Your Consultant Engineer is not correct in his assertions Darryl, and you need to press your case. In addition, he is probably in the firing line if he or his Company is responsible for the defective SI.
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19 years 10 monthsHi John Welcome to Planning
Hi John
Welcome to Planning Planet
Did you notice that this thread is 6 years old.
Its not good practice to respond to long dead threads - but we welcome your contribution to current topics.
Best regards
Mike Testro
Member for
19 years1) The disclaimer does not
1) The disclaimer does not work. He has given you information which you have used to give him a lower price. Having obtained the lower price he cannot take it away. (I have told you but i did not say it)
2) It contradicts with the constarctor's responsibilities to examine etc, as far as "practical" given "time and cost" at the tender stage.
Member for
19 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Darryl,
I assume you are on FIDIC 4th ed by the reference to Sub-Clause 12.2 ; if so, a day is defined in Sub-Clause 1.1 g ii as a calendar day. Most Conditions of Contract have definitions near the front
Member for
22 years 4 monthsRE: Unforeseen Ground Condition - EOT Claims
khoo :
The Extension of Time, you have granted is within your Contractual limitations not beyond thereof.
Ronald :
111 days of compensable overhead expenses depend upon what the Contract says in this respect that whether the said compensation is admissible under EOT Clause or not.
Member for
22 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
I do hope that along with your contract extension, that you also received 111 days of compensable overhead expenses.
Member for
19 years 11 monthsRE: Unforeseen Ground Condition - EOT Claims
Hi everyone, im back again.
Thanks for all your advice. Got 124 days extension. 111 days for unforeseen soil and 13 days for extremely adverse weather.
I would like to pose a question. What is the normal practise to calculate the new completion date?
The original completion date was supposed to be 31st December 2005. If we just consider 124 days, that will bring the new completion date to 3rd May 2006.
The question is should the 124 days include Sundays and public holidays?
21 working days for Jan (5 sundays and 6 public holidays)
24 working days for Feb (4 sundays)
27 working days for Mar (4 sundays)
24 working days for Apr (5 sundays and 1 public holiday)
25 working days for May (4 sundays and 2 public holidays)
3 remaining days for Jun (1 sunday and 1 public holiday)
Total = 124 days
Does this mean that the actual completion date should be 5th June 2006 instead of 3rd May 2006?
Member for
19 years 11 monthsRE: Unforeseen Ground Condition - EOT Claims
Thanks guys for all your valuable contributions. I believe I have a clearer picture on how to tackle the EOT claims.
Right now, I am preparing the document for submission
Regards
Darryl
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Clive,
I agree with your thoughts and would fully expect the CRE to go to ground and dig his heels in - human nature Im afraid. A certain amount of pressure has to brought to bear though and the contractors case proven in order for the CRE to be prepared to consider his position, or as you suggest find a way round it. The EoT is important to get as is the cost of any rework.
Id still maintain the contractor giving him abit of a beating along the lines Ive suggested and see what he does. The next tactical step, assuming he does as predicted and dives for cover, is to write him a letter that he cant answer himself (or would be very foolish to attempt to) and therefore to force him to pass the issue on to someone who will gather all the information and come to an informed decision!
Member for
21 years 4 monthsRE: Unforeseen Ground Condition - EOT Claims
Clive,
I think that Andrew is right in regard to the motives of the Engineer in hiding behind the disclaimer. I have experience of this in the past, where the Engineer’s company had also carried out a Site investigation that turned out be defective once the ground was excavated.
It takes time, but eventually the Engineer has to accept the inevitable!
I don’t agree that an ‘escape route’ has to be found, though I am fully aware of the cultural sensitivities in this regard from your neck of the woods!! ;-) Indeed, I have found in the past that the wording of the Conditions of Contract (in this case Sub-Clause 12.2) can be used as a face-saving device behind which the Engineer can hide. However, if he chooses not to use this camouflage, then I don’t think hat the Contractor is obliged to give him a fig leaf!!
I am not sure that a nod and a wink will work in this case; I would simply ask the Engineer where in the Contract it is stated that the Contractor is required to take on the responsibility and liability for the accuracy of the original Site Investigation! It is certainly not to be found in the Conditions of Contract (indeed, it states the opposite) and it is not included in the disclaimer!!
Cheers,
Stuart
www.rosmartin.com
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Clive,
We are not going after the CRE, just trying to force him to make an independant, resonable and fair decision on the situation, as is his job to do so. Hes chosen to take the position of hiding behind the disclaimer for what ever reason - most likely he wants to cover his companies position and or look good to the Employer. He therefore needs reminding of this duty to assess events impartialy taking in all circumstances which prevail. ie bottom line - I just want him to do his job properly.
Going for the tender SI company (which may be the same as the CREs company) is a long shot - no direct contract and I bet theres a large disclaimer somewhere in the report. You would have to prove negligence and this is actually quite hard to do. Also, and most importantly, its not going to get the Contractor an EoT for the extra work.
If the CRE, and its his choice, the Contractor will only react to his actions, wishes to maintain his position then the thumb screws must be used on him. Sorry but thats the way of the world.
Member for
19 years 11 monthsRE: Unforeseen Ground Condition - EOT Claims
Clive
Thanks for your contribution. I am sorry that my earlier statement was unclear. I have mentioned that piling works was remeasured and paid for. The piling works refered to RC piling works, not sheetpiling. The sheetpile cost is not payable. The cost have been worked into the earthwork excavation cost.
We are responsible for the temporary designs which were subsequently submitted fully endorsed by a PE. There was approval of the first design. However, no reply was received for the redesign.
During the first design, the RE actually interviewed the designer as to the parameters used in the design. All parameters used were counter-checked against the original SI. However, this event is unrecorded and the RE has left the project for greener pastures. ;-)
Now for the unanswered questions.
Valuation of the piles were not done as the rates in the BOQ is per meter driven and not by number of points. Therefore, only remeasurement is required. However, we have not considered the additional difficulty and cost of piling 1.5m above formation level, excavating the overburden between the piles and cutting of piles, casting of the base slab before proceeding with the piling works again for the next section.
During tender stage, an estimate was derived based on sheetpiles required and methods of supporting the sheetpiles. However, no design was ever produced during then. At that moment of time, considerations were made that piling was required for the structures involved.
Hope that helps
Regards
Darryl
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Darryl,
One further point in slight disagreement with Stuart - the Engineer is going to argue (or is arguing) that it the contractors responsibility to:
"inspect and examine the Site and its surroundings and shall satisfy himself before submitting his Tender as to the nature of the ground and sub-soil,"
Therefore the answer you need is one to this arguement and Stuart may be correct in that the above statement is inconsistent with other terms or conditions, the other term or condition taking precedent.
However, there is also however a general legal rule that specific clauses take precedent over general clauses and so the arguement goes on. Also which clause, if any, is a "condition" and which is a "warranty" and just to confuse everyone, the UK courts now use another term - an "innoculate" term, which sits somewhere between a "condition" and a "warranty". Please also dont get confused as "condition" used in this legal concept does not mean something contained in the "conditions of contract" document, but a term of significant importance to the contract irrespective of where it is to be found in the documents - one that goes to the "root of the contract" is often used to define a term or clause which is a "condition" as opposed to a term of clause which is a "warranty". Warranty being an obligation arising from the contract but not essential to it. "Conditions" take precedence over "warranties". And it doesnt stop there..
Confused!!!!!!!!!!
Now you know why I suggest avoiding the contractual arguements if its possible to get the Engineer to see your way of thinking some other way. The contractural route offers no guarantee of success without considerable more thought.
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Stuart,
Im from a contracting background so I would like to agree but on occassions that "half-arsed attempt to block the Contractor’s due entitlement in a lower level priority backwater clause." has managed on the facts put in front of a judge to do just that.
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Darryl,
Cant fault Stuart in his thoughts. I would however try and keep it as simple as possible to start with and see how the Engineer reacts.
The road of contractual arguement is normally long and winding, (and if it goes to dispute resolution, expensive) so if you can get a result by other means then try that way first.
My hunch is you will actually end up arguing over contractual terms, (just the way it often goes especially if theres alot of money involved) so keep Stuarts advise very much in mind and spend some time putting events in date order and thinking about thier possible significance, especially anything that could amount to an Engineers instruction.
Member for
21 years 4 monthsRE: Unforeseen Ground Condition - EOT Claims
Andrew,
I accept that the principle argument of the CRE is that the Contractor is not entitled to rely on the soils info given at tender. However, I don’t accept that that is what drives the Contractor’s entitlement.
I believe that the Contractor’s entitlement is driven by Clause 12.2 of FIDIC, and that this is not diminished by a half-arsed attempt to block the Contractor’s due entitlement in a lower level priority backwater clause. True, it does mean another hurdle for Darryl to overcome, but in my view, it does not remove his entitlement. Nor does it impose the responsibility for the Site Investigation upon the Contractor. (Does ask me where that responsibility lies – probably covered in soft clay – but contra proferentem bells are ringing!!)
Hope you have a great weekend too. ;-)
Cheers,
Stuart
Member for
21 years 4 monthsRE: Unforeseen Ground Condition - EOT Claims
Darryl,
Thanks for the added info, which – as Andrew correctly notes – does seem to paint you into a corner!! ;-(.
However, I think Andrew is right in seeing a chink of light in the third letter, and by the time you get to the end of this post, I hope there is a bit more light!!
If the third letter can be construed as an instruction to follow the contents of the Soil Report, in full or in part, then there may be some relief there. Also, at what point in the schedule was the notification of soft clay made?
The reference to the Site Investigation is contained in the General Section of the Specification, which I suggest is lower down the document priority list than the Conditions of Contract. The disclaimer to some degree appears to makes the original Site Investigation Report almost worthless in terms of its usefulness to the Contractor.
You therefore need to open up the discussion a bit:
Was it reasonable for the general site area to contain soft clay material?
Is the general area of the site prone to substantial areas of soft clay material?
Based on the topography of the ground, was it reasonable to anticipate the existence of soft clay material?
Is the Contractor a local contractor who, by virtue of his extensive local knowledge, should reasonably have expected there to be soft clay material?
Has soft clay material been prevalent in other deep foundations within the vicinity?
If the answers are: no, no, no, no and no, then I think that you may have passed the test as required by Sub-Clause 12.2 of FIDIC.
Let us look closely at the disclaimer.
In the disclaimer, the Employer does not guarantee the accuracy of the data in his Site Investigation; nor does he guarantee that the data is typical of the ground conditions to be encountered. By the same token, the disclaimer, in my view, does not require the Contractor to accept responsibility for the accuracy of the data in the Site Investigation; it merely confirms that the Employer does not accept the responsibility but that responsibility is not specifically imposed upon or accepted by the Contractor.
The disclaimer then goes on to confirm that the Contractor must do this, that and the other in regard to satisfying himself as to his completeness of Tender, which will already have been covered by Sub-Clause 12.1 of FIDIC.
The disclaimer then attempts to block the Contractor from claiming “…for additional expenses the Contractor may incur on account of any unforeseen obstacle of whatever nature, over and above those which would have been incurred had the existence of the obstacle been known at the Tender stage.” Here is where I can see Darryl’s panic setting in.
However, I suggest that this part of the Specification is in contradiction to and inconsistent with the wording of Clause 12.2 of the General Conditions of Contract, which (all things being equal!!) will have a higher priority, and under which he is entitled to EOT and additional costs if he “…encounters physical obstructions or physical conditions…which…were, in his opinion, not foreseeable by an experienced contractor…”
I also quote the note to Sub-Clause 12.2 in the Guide to the use of FIDIC (at Page 61):
Quote: “In spite of the pre-tender investigations of the Site by the parties, the Contractor may encounter unforeseen physical obstructions or physical conditions. Sub-Clause 12.2 lays down the procedure to be applied to such situations.”
***Darryl, note that the Note from FIDIC states: "In spite of the pre-tender investigations of the Site...." !!!
From this, I don’t believe that Darryl should be locked out of his entitlement to submit a claim (note that Clause 12.2 refers to “…in his opinion…” ) or have it succeed. We could start another thread about unfair contract terms, but it is already late on Friday afternoon!! ;-)
Darryl, you should concentrate on the words of Clause 12.2, in that you are an experienced Contractor which has encountered unforeseeable ground conditions (so unforeseeable that the Engineer didn’t even expect them!), and don’t cloud the issue with whether you have or have not taken on the responsibility for the accuracy of the Site Investigation (which in my view, you have not taken on!!)
In conclusion, I leave you with the weekend thought that the Contractor has not taken on the contractual responsibility for the accuracy of the data in the original Site Investigation, and that as an experienced contractor (assuming that to be the case, of course!!!!!), he could not have been expected to anticipate the existence of soft clay as ultimately discovered, confirmed by the fact, inter alia, that no such extent and nature of soft clay was discernible from a reasonable interpretation of the Site Investigation data.
Hope this helps rather than confuse!!
Cheers,
Stuart
www.rosmartin.com
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Darryl,
It may not be that bleak, just trying to make the point that it is in some circumstances the Contractors choice whether he relies on the SI data at tender - often a point not appreciated by people. Its often thought, the Engineer sent it as part of the tender so we can rely on it come what may - how wrong they are.
You dont say whether your letters were pre or post contract agreement.
Letter (iii) appears to be a good one - if it can be shown that the Engineer instructed you to rely on the borehole information, you may have him where it hurts most! Ouch!!!
One thing I didnt mention before is although this disclaimer exists, the contract has to be read as a whole. You also mentioned the clause was in the specification, not the conditions of contract. May or may not be of importance.
If it gets to the point of arguing contract conditions, read EVERYTHING and list ALL those clauses that may help your case AND ALL those that work against you. The most common mistake people make is jumping at one clause that helps them and hanging thier hat on that. You have to consider ALL the clauses, good or bad, and reconcile those that work against you before you can conclude whether your case is good or not.
Member for
19 years 11 monthsRE: Unforeseen Ground Condition - EOT Claims
Andrew and Stuart,
I know the situation sounds bleak. However, i do have several corespondence which might help
i. notification of the discovery of soft clay
ii. request whether additional site investigation is required as such soft clay may cause severe settlement of the structures
iii. reply from consultant "the site investigation has already been carried by ****. Please refer to borehole 5, 6, and 8 in the report".
We went ahead with the site investigation at our own cost (naturally!) and due to the report, the temporary works was redesigned to minimise movement of sheetpile (as method employed was not suitable) and the piles were eventually reinstated.
Regards
Darryl
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Darryl,
That seems pretty clear to me -
The story goes something like this. Employer has a soils investigation carried out. Engineer sends report out with tenders as information available about the project. The soils report or tender documentation has a disclaimer in it saying it is only interpretive and can not be relied upon.
Contractor receives tender and soils report. The contractor reads soil report and disclaimer. (and if he missed the disclaimer its his fault) The contractor now has to decide to the extent he wishes to rely on the soils report. We all know in 99.9% of cases this will be 100% reliance but thats the contractors choice and risk. What he should do is evaluate the report, decide if there are any critical areas (eg like where he is going to support his temp works) and seek further information if he thinks it needed - this may be from the Employer or by his own additional SI.
Now, if for example, access for further SI is not available and he can not obtain further information then he has a good case for saying he had to rely on the original soils report. Alternatively, if the soils report is unambiguous, eg theres sand for 10m and the report could only be interpreted one way then if it turns out differently he has a good case for why he relied on the report. The contractor may also have expressly or impliedly indicated to the Engineer during the tender period that he has relied on the report or certain aspects of it and therefore the Engineer would most likely have to stand by this later as he had prior knowledge of the contractors intent.
Unfortunately you wont find much about this in books as every case depends on its own individual facts.
I could pick holes in the clause such as it refers only to restricting (but not barring) claims for obstacles and therefore differing soil condition claims are unrestricted etc.
I would still suggest that your best option is to use the position talked about earlier before going down the route of arguing the legal niceties, although be prepared for this as thats what it may come to.
Member for
19 years 11 monthsRE: Unforeseen Ground Condition - EOT Claims
This is the clause used for reference to the SI report in the General Specification
A soils investigation report is available as described in Section 02200. The report is indicative only of the conditions of various points within the Contract area. The Employer does not guarantee the accuracy of the data in the Report, nor does he guarantee it is typical of the ground conditions likely to be encountered. The Contractor shall inspect and examine the Site and its surroundings and shall satisfy himself before submitting his Tender as to the nature of the ground and sub-soil, the quantities and nature of the work and materials, tools and equipment necessary for the completion of the Works. No claim will be considered for additional expenses the Contractor may incur on account of any unforeseen obstacle of whatever nature, over and above those which would have been incurred had the existence of the obstacle been known at the Tender stage. Any excavations needed to determine the exact location, and levels, of obstacles shall be done by the Contractor. The Contractor shall obtain all further information required as to the risks, contingencies and other circumstances, which may influence or affect the execution of the Works and include the costs thereof in his Tender.
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Stuart,
The principle arguement of the CRE is that the contractor is not entitled to rely on the soils info given at tender. If that is the case, the contractors claim fails, if the CRE is wrong, then the contractors claim stands.
I agree the contractor should put in a claim, but until the above point is decided, I wouldnt hold my breath counting on the claim.
If the contractor is entitled then he can claim misrepresentation. Most soil reports Ive come across have a disclaimer buried in them somewhere and therefore Im not going to bet on the outcome of this without knowing more.
If the soils report was bound in the contract then it would be somewhat clearer but then I guess Darryl wouldnt be having the problem he is.
Member for
21 years 4 monthsRE: Unforeseen Ground Condition - EOT Claims
Andrew,
I used the word “probably” in reference to the likelihood of the Contractor being induced to rely upon the information. I stated categorically that he did rely upon the information (or at least that is my understanding from Darryl’s initial post).
In the absence of having seen anything to the contrary, such as reference to any particular exclusion of liability clause, I believe that the Contractor is entitled to recover his additional time and costs arising out of the defective SI Report.
Darryl originally posted his question not within the context of whether or not he was entitled to claim (indeed, his initial post confirms that he has already claimed), but he is looking for ways to counter the arguments of the (responsible??) CRE.
Cheers,
Stuart
www.rosmartin.com
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Stuart,
Your statement "is that the Contractor relied (and was probably induced to rely) upon the correctness of the contents of the SI Report." has one critical word in it - PROBABLY, and we dont the answer to that.
If he was entitled to rely, then everything else flows from that. If he wasnt, nothing flows from it and it fall down like a stack of cards.
Member for
21 years 4 monthsRE: Unforeseen Ground Condition - EOT Claims
Darryl,
Make sure that you also include for the additional time of having to re-engineer the entire Temporary Works; it isn’t just a case of additional on-site time for longer piles, but you need to re-cycle your engineering work, probably starting from [before] square one.
You gain even less if your claim isn’t robust!! ;-)
Cheers,
Stuart
www.rosmartin.com
Member for
21 years 4 monthsRE: Unforeseen Ground Condition - EOT Claims
Darryl,
Thanks for the added info and clarification!
Andrew,
As Darryl pointed out in his original post, it doesn’t appear that the SI info was incorporated into the Contract documentation, but I think that is a moot point!! ;-)
What is more important, I suggest, is that the Contractor relied (and was probably induced to rely) upon the correctness of the contents of the SI Report.
Based on this reliance, the Contractor produced his Price and Schedule for carrying out the Works, including the time and cost of executing the subject Temporary Works.
During the progress of the Works, it later became evident that the SI information relied upon for the safe execution completion of the Temporary Works was defective.
Therefore, the Contractor should be entitled to claim for the additional costs and time incurred as a direct result of the defective SI Report.
I agree with you that the Contractor should go very hard against the CRE in this case; indeed I suspect that the CRE is bluffing and stalling for time! We don’t know if he is implicated in the defective information contained in the defective SI Report – I have been in situations before where the RE’s company screwed up the original SI Report and there was lots of eggs on faces!! ;-)
Cheers,
Stuart
www.rosmartin.com
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Darryl,
You gain nothing unless your claim is accepted.
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Stuart,
I agree with what you say Stuart but as is often the case when the soils investigation or the interpretation of it is wrong, the first thing the CRE tries to hide behind is that they dont warrant or guarantee the tender information to be correct. We all know the contractor relied upon it at tender and designed his temporary works accordingly. Was he entitled legally to rely on it is a different matter.
As the law stands (UK anyway) in general, is any representations made prior to the contract, if intended to be relied on and part of the contract, should be bound into the contract. Hence, soil reports, method statements, programmes, etc are not usually bound into the contract as if they are, they take on a completely different contractual meaning. To establish if the contractor could rely on the tender soils report and hence claim, you would have to have sight of all the tender correspondence associated with it and establish exactly what was said and done. Without that information youre guessing. And what the law in Malaysia is might be completely different. Certainly in the Middle East, the contract is the contract and nothing said or done prior to the contract counts for anything. And come to that, was the contract made in Malaysia or elsewhere, we do not know. Whos legal jurisdiction applies?
The actions of the CRE are pointers as to how he thinks - he certainly isnt going to stand by his own work or information so be warned. Thats one of the reasons I would go in very hard at this point - so that he thinks twice about similar tactics in the future. Unfortunately sometimes it has to be done.
Clive,
This is purely a case of reliance (or not) on tender soils information not bound into the contract. The change in design may help prove your case but is irrelevant to the core problem.
Member for
19 years 11 monthsRE: Unforeseen Ground Condition - EOT Claims
Clive & Stuart,
Firstly, CRE stands for Chief Resident Engineer. The project involves 5 sub-projects and each project is helmed by a Resident Engineer each.
The temporary works were designed based on the SI report with no provision for piling works to be done later. Excavation involved is approximately 8m deep and the SPT count is between 7 to 9 (Sandy). Upon completion of the additional SI, the SPT count was reduced to 0 - 3 (Soft Clay). Below the formation level of the structure, the SPT count was between 5 - 8 (Silty to Sandy) upto the depth of 21m. The new SI recorded 0 - 7 (Soft Clay).
Interestingly, i forgot to mention that the sheetpile actually failed on two counts. The anchor is selected due to friction between the anchor and sandy soil. Since soft clay is encountered, the anchor failed as no friction could be mobilized. The amount of anchors used doubled. A section of the sheetpiled wall actually tilted and moved horizontally thus requiring removal and repiling.
For your information, piling is remeasured and paid for.
Thanks for your help. I just realised that i have erred. Could actually gain approximately 2 months due to increase in pile depth. Just thought about it after reading through your contributions.
Regards
Darryl
Member for
21 years 4 monthsRE: Unforeseen Ground Condition - EOT Claims
Clive,
The Contractor’s remedy will be against the Party with whom he is in Contract, the Client or Employer.
The CRE (Client’s or Consultant Resident Engineer – not sure which terms are used in this instance!!) is the representative of the Client or Employer. So the CRE isn’t the one being ‘got at’; the Contractor will ‘go after’ the Client/Employer, but he has to communicate through the Engineer, as set out in Clause 2 of FIDIC.
This situation appears to revolve around the Contractor having been given important sub-soil information upon which he designed and constructed his Temporary Works. That sub-soil information appears to have been given to the Contractor by the Client/Employer (or his Representatives), but the information turns out to have been defective, because it failed to identify soft clay that in fact was present.
As a direct result of the failure of the identification of the sub-soil clay, the Contractor has suffered from additional costs and loss of time.
The CRE – probably feeling both foolish and defensive – has said that the Contractor should have foreseen the existence of the clay that was hidden underneath and that was not identified in the sub-soil information. My view is that if it was foreseeable by the Contractor (which I doubt is the case) why was it not equally foreseeable by the CRE?
In addition, I hold to the view that the Contractor is fully entitled to depend upon the information related to the sub-soil that was given to him at the time of tender; the Contractor had no reason to question the veracity of the sub-soil information, and he is entitled to rely upon the reasonable expectation that the sub-soil information was correct.
Hope this helps,
Stuart
www.rosmartin.com
Member for
21 years 4 monthsRE: Unforeseen Ground Condition - EOT Claims
I would suggest that even if the SI Report was not incorporated into the Contract documentation, it still constitutes representation upon which the Contractor was entitled to rely, and use as a bona-fide basis for the design and construction of his Temporary Works.
In addition, the CRE now appears to consider that the Contractor should have foreseen that the location in question had soft clay. I would ask the CRE why, if this is the case, was it not equally foreseeable by the CRE? Many people forget that the construction process is a team, not an adversarial, process, so if it was foreseeable by the Contractor (which I don’t think it was!), then it must have been foreseeable by the CRE!
Hope this helps,
Stuart
www.rosmartin.com
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Darryl,
Back to the same old story - what did the contract have in it, not the tender. It is the contract agreement that is of importance.
If this does not have the piling in (which on what you say it didnt) then I would argue that thier change in design from tender to contract only reinforced your interpretation as to the prevailing ground conditions.
I would further argue that in ignoring the design engineers interpretaion if it was correct, amounted to a breach of duty of reasonable skill and care to the Employer and mention you hope thier Professional Indemnity insurance policy is fully paid up when the Employer finds out.
Member for
19 years 11 monthsRE: Unforeseen Ground Condition - EOT Claims
Andrew
I was having the same thought.
i. In the tender drawing, piling was required. The criteria was pile to length of 9m.
ii. When the construction drawing was issued, the piling works were removed.
iii. Upon noticing the soft clay, the engineer reinstated piling. The criteria was changed to pile to set.
The CRE for the project has acknowledged that it was a mistake to remove the piling. However, his interpretation of the above events is, it indicates that the design engineers has interpreted the si report correctly and the reinstatement of the piling works reinforced that.
He has informed that the reason for removal of the piling works was due to the engineers decision to reduce cost, thus replacing the pile with 600mm thick of crusher run or hardcore. We doubt that this is the case and suspect that he made up the story to support his interpretation... But that will be another story. ;p
Cheers
Darryl
Member for
20 years 10 monthsRE: Unforeseen Ground Condition - EOT Claims
Darryl,
If the SI info was not incorporated into the contract then it may (or may not) only constitute a representation made prior to the contract (even though wrong) and hence the Engineer may be correct. Alternatively Stuarts thoughts are correct.
There is alot of case law on this subject and depending on the exact circumstances, the courts have supported both sides of the arguement. A definative yes or no answer isnt really possible without knowing more.
One general principle that may be of help is on the discovery of the actual ground conditions, did the Engineer revise the design due to the new information? If so then the ground conditions must have been unforeseeable otherwise a competent designer would have taken them into consideration and designed the works to suit. If the Engineer insists that its still unforeseeable then point out that you feel duty bound to tell your client that the Engineer has been potentially negligent in his design and that your client should claim the additional costs back from the Engineer. That often focuses the Engineers mind.
If no redesign was required then the Engineer has a pretty good arguement that the conditions were foreseeable and he took them into account in his design - even if he didnt foresee them but how are you going to prove that!
I would try this first Darryl with regard the reintroduction of the piling etc and leave the reliance issue on tender information, if required, for later.
Member for
19 years 11 monthsRE: Unforeseen Ground Condition - EOT Claims
Thanks for your replies.
Is there any literature for reference where upon arbitration, the contractor is entitled to claims and extension of time due to unforeseen ground condition?
This will definitely help.
Thanks
Member for
20 years 6 monthsRE: Unforeseen Ground Condition - EOT Claims
Daryl,
This is a common problem where the Consultant states that as an experienced contractor, you should have studied, checked and examined the site conditions, etc. and the Contractors statement that he received in the tender stage S.I. report for information only and that these geological conditions were unforeseen and unpredicted...
I can tell you this: For many years, several forms of interpretive geotechnical reports have been incorporated into the Contract Documents for underground construction projects. It is now recommended that the Geotechnical Baseline Reports (GBR) be the interpretive report included in the Contract Documents. Its primary purpose is to establish a contractual statement of the geotechnical conditions anticipated to be encountered during underground and subsurface construction. This guideline and practice manual is intended to serve as a reference for preparers and users of GBR, and to inform owners of the importance of the contents of the GBR as related to the allocation of financial risk. In order to do this, it provides a checklist of items to consider when preparing the GBR, recommendations for the content and wording, and presents examples of problematic and improved practice in stating baselines. The question is: does this S.I. report provided to you for information, was detailed and gave sufficient/accurate information as it should be a real GBR?
The owner defines his expectations by a functional description of the project, a GBR on the basis of a
geotechnical database (GDB) that is as independent as possible from the construction method. Furthermore, he informs the bidders of the qualitative results of his risk analysis and on that basis defines the financial limit to which prospective bidders have to bear risk.The Maximum Bidders Responsibility (MBR) represents the financial limit from which it is the owner who will bear the costs caused by the geology. But below that, the contractor is responsible for his expectations to the geology, i.e., the competitive tender remains effective up to the MBR.
Therefore, this depends on the Clarification Meetings made in tender stage, type of contract (Lumpsum, BOT, etc.),risk analysis of your company and uplift/overhead put to account for geology factors, etc.
Also, when these unforeseen conditions occured, the Owner/Consultant/Contractor should surely agree on overcoming these conditions. Usually, the Contractor will be instructed to assign a third party to investigate the soil and propose an adequate system which will be approved by the Designer/Consultant before proceeding work. In this stage, the Contractors planner should revise the program of work, putting in his schedule these unforeseen site conditions, extra site reports needed in particular areas, adequate system agreed upon (boreholes, piling, nailing, etc.) and submit in a short time the revised schedule with the new completion date to the Consultant for his review and consent...
Cheers
Jihad Daniel
Member for
21 years 4 monthsRE: Unforeseen Ground Condition - EOT Claims
Darryl,
You should keep in mind that the Contractor is entitled to rely upon the accuracy of any information that is provided to him as part of the tender (or related) documents, even though that information is not part of the Contract documents.
Therefore, if the Contractor has acted in all good faith and assuming that he has properly interpretated the Site Investigation data made available to him, then he should be in the clear. There is not an obligation on the Contractor to re-do the original SI nor verify it; nor should he be expected to assume that the original SI was defective (as it clearly was!)
Clause 12.2 of FIDIC allows an EOT claim where the Contractor encounters physical conditions that were not foreseeable by an experienced Contractor. In being supplied with a SI at the time of tender, which the Contractor was entitled to believe and upon which he was entitled to use as a basis for the design of his temporary works, the SI sets out the broad nature and extent of the foreseeable ground conditions.
If reality proves to be otherwise, then the original SI is clearly at fault, then the Contractor should be entitled to the additional costs and time that flow from the defective SI.
Under FIDIC (and most other Forms of Contract) the Contractor cannot be expected to assume the risk and responsibility for the correctness of a SI at tender stage (unless the Contract specifically enforces this obligation on him, and in such a case the Contractor must be given the opportunity to verify the original SI).
Your Consultant Engineer is not correct in his assertions Darryl, and you need to press your case. In addition, he is probably in the firing line if he or his Company is responsible for the defective SI.
Hope this helps,
Cheers,
Stuart
www.rosmartin.com