Impediment, delay and prevention - FIDIC

Cause and Effect: The Key to Successful Construction Delay Analysis

I’m sure that you have heard the advice that if an extension of time claim is going to succeed, the claim must demonstrate a link between cause and effect. The claim must demonstrate that the event(s) on which the claim is based affected the time for completion. Showing the impact and time involved is key.

Delayed activities may not be on the critical path. If this is the case, the delay event may consume float. In turn, this may cause subsequent activities to become closer to the critical path. But if the event does not affect the critical path and thus, the time for completion, there will be no extension of time.

Risk Allocation

The risk allocation of the contract may make the contractor responsible for the effects of some delays. If there is no entitlement to additional time in the contract there will be no extension of time.

Sometimes contractors realise towards the end of the project, that they will not complete on time. In such a case, delay penalties will likely be applied and they will incur overrun costs.

At this point, they might consider they need an extension of time. This is in contract to considering whether entitlement to an extension of time exists. Consequently, they hurriedly submit a claim for multiple delay events. They assert that all these delays entitle them to an extension of time up to the date that they completed. This is known as a global claim. In all but exceptional circumstances, it will be rejected by arbitrators and the courts and thus, by contract administrators. This is because such a claim does not demonstrate the effect of each event, either individually or cumulatively, on the time for completion.

How To Show Cause And Effect?

So how can we demonstrate a link between cause and effect in our claims? The answer is by carrying out a suitable form of delay analysis. The purpose of such an analysis is to illustrate the effect of the claimable delay event on the time for completion by using suitable programming techniques.

There are many forms of delay analysis. The selection of the most suitable method depends on several things, including:

  • The existence of suitable programmes.
  • The quality of the baseline programme.
  • The quality of the records.
  • Where the project is in terms of execution at the time the claim is being prepared.

Considering all factors is key to successful analysis. The Society of Construction Law’s Delay and Disruption Protocol gives excellent advice on this subject.

Necessary Knowledge

Delay analysis can be a complicated subject and demands suitable knowledge and skill. It is, therefore, necessary to have suitable resources available to prepare this very essential part of the claim.

If you are the person responsible for preparing the claim and you are using others to perform the delay analysis, you don't have to be a programming expert. However, you need a strong overview of the subject so that you understand the protocols, techniques and how to identify specific causes and their effects. This will enable you to check and demonstrate a number of things:

  • The accuracy of the analysis.
  • Why the particular form of delay analysis is suitable.
  • How the analysis was performed.
  • What the analysis demonstrates.

If this topic interests you, you'll be delighted to find that we now offer delay analysis e-courses. Take a look and join us to bring your knowledge up to speed.


interim claims

10 Things Construction Gets Wrong When it Comes to Claims

Inadequately expressed claims are one of the leading causes of time-consuming and costly disputes. Avoid common mistakes to ensure acceptance of claims.

In this post, we set out ten common reasons that claims end up as disputes and offer best practice tips so you can ensure you do better. Take a look at the following, have you fallen foul of them? Are you constantly looking out for them so you can avoid them?

Common Mistakes

  1. Contractors wait until the end of the project to submit claims, instead of submitting claims when entitled to, as the project progresses.
  2. Contractors include several delay events into a single consolidated claim instead of preparing separate claims for each delay event.
  3. Contractors do not give notices of claim within contractual timeframes, and notices do not contain necessary information.
  4. Claims do not contain an adequate examination of cause, effect, and entitlement to justify the claim.
  5. Claims are not adequately substantiated to prove that the claim is just.
  6. Engineers and contract administrators do not follow their contractual obligations to respond to claims and attempt to reach agreement.
  7. Both claims and responses to claims are poorly expressed, so the recipient has difficulty in understanding the claimant or respondent’s positions.
  8. Delay analyses to demonstrate extensions of time are not performed following good practice.
  9. Cost claims are poorly demonstrated and substantiated.
  10. Those tasked with preparing and responding to claims are inadequately trained and qualified.

Whilst very common mistakes, these are all avoidable. They are all things you can keep an eye out for and minimise or even eliminate to ensure project success.

If you would like to learn how to submit successful claims and achieve quick resolution on projects, take a look at our e-courses.


delay

Top Tips for Delay Analysis in Construction

Delay analysis can be a confusing world. We’ve put our expertise together to create a free download with our top tips for preparing a delay analysis.

Despite ongoing improvements in the way in which projects are executed, delay remains one of the biggest sources of dispute. It is also one of the most significant causes of cost overrun in construction projects.

When a delay occurs on a construction project, analysing cause and effect is vital to understanding where liability lies. Delay analysis (sometimes called Forensic Planning) is something which some refer to as a ‘dark art’. Arguably because it’s often misunderstood by those who carry it out or claim to understand it.

There are at least six analysis techniques that are commonly accepted. However, depending on who you ask there are many more - which can add to confusion. It's generally agreed that no single method is better than the others. With a mix of prospective and retrospective approaches techniques can vary according to need.

A prospective analysis such as ‘Impacted as Planned’, or ‘Time Impact Analysis’ is often used whilst the project is still ongoing. This can help assess the impact a delaying event will have on the future completion date. Prospective methods can also be used on completed projects. However, extreme care should be taken when doing so to ensure the ‘theoretical’ prospective analysis corresponds with the ‘actual’ facts.

Whatever method is being used to analyse delay there are a few things you need to establish for a successful claim.

We have put together some of our top tips on preparing a successful delay analysis from our team of claims experts. Download our top 20 tips on delay analysis for free here:

 


Progress Updates – Fact or Fiction?

Contractors often shoot themselves in the foot when preparing progress updates for the employer’s team. Many times we see months worth of updates which present a rose-tinted view of project progress.

Whilst it is tempting to keep reporting good news month-on-month, be wary. A less than competent consultant may believe such reports because good news will not involve them in additional and troublesome work. However, you could be causing problems for yourself further down the line.

Problems frequently arise when the contractor needs to submit a claim for an extension of time. It becomes very difficult for him to subsequently tell the employer’s team: “I know we kept telling you that there was no delay to the completion date, but actually there is and it’s not our fault, so please can I have an extension of time.

Read more


Site Access & Time at Large - Battersea Stock Image

Time at Large - An Explanation

A blog reader asked for an explanation of “time at large”. This is not something that I have personally come across in practical terms. For the advice that I am about to give, I am indebted to my ex-boss, Roger Knowles. Roger provides an explanation in his book, 150 Contractual Problems and their Solutions. Roger explains it arises:

"when a contract is entered into with no period of time fixed for completion. Where this occurs, the contractor’s obligation is to compete within a reasonable time."

I have never experienced such a situation and I expect that when it does occur, it will be on Read more


Impediment, delay and prevention - FIDIC

Student’s Questions - FIDIC Information, Delay and Prevention

One of the modules on our e-courses requires the students to review various case studies to identify potential claims. Having identified the claims, the student is required to explain the reasons for the claim and what may be claimed. We examine the contractual clauses under the FIDIC Red Book that provide entitlement and explain how the claim would be evaluated. Having completed the module, one student posed certain questions. These were particularly around information and clause 8.4 on delay, impediment or prevention, which I think are worth repeating here.Read more