Do you play shares? Share analysis usually applies two methods to analyze a particular share: fundamental and technical. Fundamental concerns the stock value, that is, whether it is worthy buying it; while the technical uses various kinds of chart to determine whether the “good” counter picked up by the fundamental analysis is the right timing to buy or sell – the price is alright or not.
Construction claim, to some extent, is similar to share analysis. The conditions of contract, specification and all written documents are fundamental aspects to see whether there are grounds to raise the claim. The approved baseline programme, or CPM analysis, is to determine how much a contractor is entitled to claim, especially when comes to EOT (extension of time) claim.
The following are some pointers to consider:
- Is the change belonging
to owner side or contractor side? And if mixed, how much belonging to owner
side, and how much to the contractor?
- To what extent the scope of work has been changed? Calculate the volume.
- What is the effect the delay contributing to the critical path and how much with reference to the approved baseline programme?
Typically, a "Notice of Claim" shall be submitted to the Engineer within the specified days after the event. The subsequent full and detailed claim documents shall be followed afterwards.
In order to build up the claim case, a good and systematic document repository is to be set up from day one of the project. Ideally, the project document repository shall be centralized and not segmented around a few departments and personnel. There are two benchmarks to be established from which the claim is based on:
- All information including
specifications, drawings, tender clarifications at the tender stage and before
the contract is awarded. Anything beyond those which an experienced contractor
can not foresee at the time of tender is considered variations
- Production rate before disruption. The approved baseline programme is based on the normal achievable productivity. If an event occurs and causes the delay of progress, the post-event actual productivity suffered by the contractor can be demonstrated with the "cause and effect" chart.
Schedule is the tool to quantify or measure the delays and disruptions. There are two types of schedules for this purpose: conventional statused programme (updated programme in the approved baseline, showing plan and actual activities of bar by bar comparison). This method requires relatively accurate baseline programme in order to serve the purpose. In reality, there is always work sequence deviation between the plan and actual and sometimes the deviation is too severe to reflect the actual construction. Revising the baseline is one solution. The other one is called "Forensic Schedule Analysis" or "Retrospective As-Built Schedule Development", a schedule modelled based on the actual construction. It contains:
- Breakdown of the project
into several process modules
- For each process, establish the typical actual schedule model (fragnet). It shall reflect the actual construction sequence and represent the majority of this process
- For each data date (for example, end of each month), retrospective schedule = baseline + fragnet (replacement of the correspondent part of the original baseline)
- Status the above programme
- Find out from the retrospective schedule:
> Projected project completion at that time
> Critical path at that time
> Which activity causes the delay and how much
The final retrospective schedule represents the normal and non-disruptive work sequence with the actual typical productivity. It is then used to measure the actual site works.
The Contractor’s claim
team comprises the following personnel:
- A lawyer who is familiar with the construction industry to act as the advisor
- The commercial manager who is the head of the team
- The coordinator to integrate all aspects of information and efforts, from site operation team to various site records
- Event report writers
- Planners to work out time impact
- QS to work out cost impact