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NEC ECS: Best way to make a critical path delay claim

+1 vote
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We are a sub-contractor on a large London project. The Contractor is responsible for design and materials. They are in delay and we have passed the contract Completion Date. I claim 130 shifts of NCEs every week and raise quotes for these with time impact. As I am raising so many shifts on a weekly basis we cannot show a programme for each shift. My calculation is if we lose 3 shifts say due to frustrated access and we have 3 teams then 3/3 = a 1 day delay. We submit a monthly programme and can do a monthly analyses/NCE comparing the shifts from the last accepted programme. The Contractor is paying for the delay costs at the moment but has in the past changed his mind to suit himself. Am we doing enough to protect ourselves?
asked Jul 30 in NEC3 Compensation Events by iainraeqs01 (230 points)  
   

2 Answers

0 votes
Are you doing enough to protect yourself - probably not.

If your planned Completion is delayed due to effects that are not your own fault/risk then you need to be able to attach this to a specific compensation event under clause 60.1. A compensation event should then be assessed under clause 63.3 which talks about forecast defined cost and actual defined cost, the boundary being when the instruction given to change the Works Information or when the compensation event was notified.

A rolling CE assessment is not a good idea or contractually correct. If you are already 100 days beyond Completion Date, you need a CE or number of CE's to equate to that 100 days. Until an event is implemented you can not rest as the liability is only confirmed at that point.

If you can agree a way of bundling up small groups of CE's then that is fine - but by agreement. The fact that you are submitting a revised programme that may or may not be formally accepted is irrelevant in terms of ascertaining or admitting liability.

Therefore I suggest you have much more to do here and suggest you get back round the table with your Contractor to agree contractually what both Parties need to do in order to ascertain liability.
answered Jul 31 by Glenn Hide (33,040 points)  
0 votes
Sounds like you are working on a Transport for London / London Underground Project which requires traction current to be discharged to allow works to be undertaken during an Engineering Hours shift.  This is an extremely difficult compensation event to quantify and assess, both in terms of cost and programme, having personally administered literally 1000's of these over the years.

Essentially, however, it is 'just another CE' and the same rules apply here in terms of Defined Cost and programme assessment.  Review each operation (activity) in terms of time, based upon the allowable working time (say 15 mins following traction current switching and 10 mins prior to the Call Back time given.  This gives a 'productive working time' for each Engineering Hours shift.  Then calculate the total amount of time and assess the total programme duration for that operation, or connected series of tasks (not including Time Risk Allowance).  Do this for each operation and see where the critical path 'travels' through.

Not all 'frustrated (cancelled / delayed / disrupted) access' shifts will lead to a delay to planned Completion, although many will incur 'activity prolongation', where you can demonstrate that the duration has increased due to the direct effect of compensation events (from the calculation of total productive working time above).  

Personally I would suggest that the effect is calculated on a Periodic (4 weekly) basis which will require agreement with the Contractor.  This ensures a fair and reasonable assessment, otherwise it is nothing other than guesswork trying to calculate the effect of individual events.  Bear in mind that such an event is most likely a back-to-back entitlement under the main contract anyway and I can likely guarantee that the Contractor is having problems trying to reasonably substantiate his assessment under the main contract, which is probably why the Contractor's administration of this matter is a bit 'hit and miss'.

Your assessment of losing 3 shifts with 3 teams equaling 1 day may sound reasonable but a more detailed and considered approach will take away a large element of subjectivity in the assessment.  I am aware that some activities require a minimum amount of time during an Engineering Hours shift otherwise it cannot be completed, for example; certain 'hot' works, or track or signaling based activities, which can be treated separately as an entire shift may become non-productive where (say) an hour of time is lost.

From what you say, it looks like you are notifying each event so that is a good start and submitting quotes as well, although the programme assessment appears less consistent.  Maybe think about the approach I have suggested above with regard to 'productive working time' and see what the calculation gives you in terms of time.

I appreciate that there are also other risks, including; the loss of time may increase the risk for 'handback', although a generic principle would make things a lot easier to administer and would likely give a fairer solution as not all risk will be realized anyway..
answered Jul 31 by Andrew WI (3,510 points)