I quite agree with your sentiments but as the Client I would make quite sure the consultant knew exactly where he stood first.
The underperformance could end up creating large problems costing you more in dispute resolution than its worth. This is a commercial decision for the client to take, but let it be known where the starting point is.
Member for
19 years 7 months
Member for19 years7 months
Submitted by Simon Peter Cordner on Tue, 2006-04-04 16:12
Contractually, the previous responses are correct. The contract is lump sum, and the consultants underestimation is his own trouble to bear.
Strategically, as the client rep youre going to want to consider how MUCH the consultant has underfunded himself and the affect that could have on your project. A consultant that cannot perform the services that you would like represents a risk that deserves acknowledgement.
Now that the consultant is aware of the underfunding, to what extent will they accept the loss of profit and increase manpower? To what extent are they willing to provide a substandard product in order to preserve their profit? Are you going to be struggling throughout the lifetime of the project with a consultant that consistently understaffs and subsequently underperforms?
Its most likely the best idea to force the consultant to increase manpower with no change to contract amount, but you should maintain a wider perspective on the implications that will have.
I think that you have answered your own question, when you state : “The cost is also fixed based on the agreed scope.”
If the workscope has not changed, then why change the price??
In my experience, Client’s are notorious for under-estimating their own manpower requirements, though they are the first to complain when Contractors don’t provide sufficient manpower!!
I would underline Andrew’s opinion: he’s got to do it and he doesn’t get anymore money for it!!
Assuming no increase in the original scope of work then under a lump sum agreement the starting position in English law is it is up to your consultant to produce the goods as required, end of story, no more money.
If he requires 100%, 200%, 300%, etc increase from his originally estimated manpower to forfill his obligations then Im afraid thats what hes got to do and he doesnt get anymore money for it.
Remember also, under a lump sum agreement it is up to your consultant (and any other party, contractor, etc) to complete his contract and that includes doing everthing you could reasonably have foressen at tender he would have to do and include, whether mentioned on the drawings, in the spec, in the contract, etc, OR NOT.
If there has been unforeseeable changes rom tender then its a different story but otherwise the above applies. Also check his contract to see theres no get around clauses that apply.
Member for
19 years 10 months
Member for19 years10 months
Submitted by Norzul Ibrahim on Mon, 2006-02-20 10:00
Member for
20 years 10 monthsRE: Increase of Manpower - Variation Order?
Simon,
I quite agree with your sentiments but as the Client I would make quite sure the consultant knew exactly where he stood first.
The underperformance could end up creating large problems costing you more in dispute resolution than its worth. This is a commercial decision for the client to take, but let it be known where the starting point is.
Member for
19 years 7 monthsRE: Increase of Manpower - Variation Order?
Contractually, the previous responses are correct. The contract is lump sum, and the consultants underestimation is his own trouble to bear.
Strategically, as the client rep youre going to want to consider how MUCH the consultant has underfunded himself and the affect that could have on your project. A consultant that cannot perform the services that you would like represents a risk that deserves acknowledgement.
Now that the consultant is aware of the underfunding, to what extent will they accept the loss of profit and increase manpower? To what extent are they willing to provide a substandard product in order to preserve their profit? Are you going to be struggling throughout the lifetime of the project with a consultant that consistently understaffs and subsequently underperforms?
Its most likely the best idea to force the consultant to increase manpower with no change to contract amount, but you should maintain a wider perspective on the implications that will have.
Member for
21 years 4 monthsRE: Increase of Manpower - Variation Order?
Norzul.
I think that you have answered your own question, when you state : “The cost is also fixed based on the agreed scope.”
If the workscope has not changed, then why change the price??
In my experience, Client’s are notorious for under-estimating their own manpower requirements, though they are the first to complain when Contractors don’t provide sufficient manpower!!
I would underline Andrew’s opinion: he’s got to do it and he doesn’t get anymore money for it!!
Hope this helps,
Stuart
www.rosmartin.com
Member for
20 years 10 monthsRE: Increase of Manpower - Variation Order?
Norzul,
Assuming no increase in the original scope of work then under a lump sum agreement the starting position in English law is it is up to your consultant to produce the goods as required, end of story, no more money.
If he requires 100%, 200%, 300%, etc increase from his originally estimated manpower to forfill his obligations then Im afraid thats what hes got to do and he doesnt get anymore money for it.
Remember also, under a lump sum agreement it is up to your consultant (and any other party, contractor, etc) to complete his contract and that includes doing everthing you could reasonably have foressen at tender he would have to do and include, whether mentioned on the drawings, in the spec, in the contract, etc, OR NOT.
If there has been unforeseeable changes rom tender then its a different story but otherwise the above applies. Also check his contract to see theres no get around clauses that apply.
Member for
19 years 10 monthsRE: Increase of Manpower - Variation Order?
???Any advise??