Construction Project[1]

8/2/2019 Construction Project[1]

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Construction Project

Management andContract Procedures

Module 2

April 12,2012.Mr. B. Leahing

Keian Walker


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Question

The administration of construction contracts are consideredsignificant to the outcome or effective of any construction

project. It is therefore essential that the contractadministrator or project coordinator has a significantappreciation for the different types of contracts available tohim.n If the money being spent by the Jamaican government

was secured through negotiating with an internationallending agency, select the most effective contract typethat can be used to achieve an effective capitalconstruction project in Jamaica.

n The FIDIC engineering and construction document setsout the necessary guidelines as to the responsibilities ofvarious stakeholders to a contract.

Explain in detail the responsibilities of the client in the FIDICengineering and construction document.

Explain the responsibilities of the Engineer in the FIDICEngineering and construction document.


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Introduction

n Construction

n Contracts

n Administration

n Which one will we use?

n The FIDIC


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Contracts

n Contracts we have not used.

n

Why are they not effective to beused?


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What is BOOT?

nB- BuildnO- Ownn

O- OperatenT- Transfer


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BOOT, Project DeliveryMethod

n Design and construction

n Finance

n Operations and maintenance

n

Marketing and customerinterface

n

Concession period


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Cost and Benefits ofthe BOOT

Procurement Method

n Enhanced efficiency

n

Access to broader fundingn Risk sharing

n Whole of life approach

n Access to latest technology

n Economically sound decision-

making


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To Reduce Costn Sufficient work by government prior to

approaching the marketn Large amount ofcertainty that the project

will go ahead

n Engage experienced advisers

n Short, sharp process

n High degree ofintegrity

n Reasonable (real) short-listsn Few negotiable items post bid


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The Client (Employer)

n

As per the FIDIC the employer isdefined as the person named asemployer in the Contract Data and

the legal successors in title to thisperson.

n This person is the initiator of the

project. The Employer can be anindividual, an organization or as in

the case of the scenario given agovernment.


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Client:

Right of Access to the Site

n The Employer shall give the Contractor

right of access to, and possession of all

parts of the Site within the time stated inthe Appendix to Tender.

n However, the Employer may withhold

such right of possession until thePerformance Security has been received.


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n If no such time is stated in the Appendix

to Tender, the Employer shall give the

Contractor right of access to, and

possession of, the Site within such timesas may be required to enable the

Contractor to proceed in accordance with

the programme submitted.


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n If the Contractor suffers any delay as aresult of a failure by the Employer to giveany such right or possession within such

time, the Contractor shall give notice tothe Engineer and shall be entitled to:

Extension of time for any delay ifcompletion is or will be delayed and

Payment of any such Cost plus reasonableprofit which shall be included in the ContractPrice.


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n After receiving this notice theEngineer shall proceed in accordancewith the clause on determinations to

determine these matters.n However, if the Employers failure was

caused by an error or delay by theContractor including an error in, or

delay in the submission of any of theContractors Documents, theContractor shall not be entitled of

time, Cost or profit.


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n The possession does not necessarilymean exclusive possession, butshared possession needs clarification

in the Particular Conditions.n When the Contractor takes possessionof the Site, he is responsible forsafety, security and insurance. If the

Contractor does not have full controlof the Site and the activities on theSite, or the site will be shared, thenthe extent of the Contractorsresponsibilities must be clearly stated.


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n If the Employer fails to give right of

access to and possession of the Sitewithin the stated period then the

Contractor will be entitled to anextension of time plus his costs anda reasonable profit.


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Permits, Licenses or Approvals

n The Employer shall provide reasonableassistance to the Contractor at the requestof the Contractor:

n By obtaining copies of the Laws of theCountry which are relevant to the Contract

n For the Contractors applications for anypermits, licenses or approvals required bythe Laws of the Country


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Employers Personnel

n The Employer shall be responsible forensuring that the employersPersonnel and the Employers otherContractors on the Site:

Cooperate with the Contractorsefforts and

Take actions similar to those which the

Contractor is required to take in relationto the clauses relevant for SafetyProcedures and Protection of theEnvironment.


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Employers Personnel

n When two or more Contractors areworking on the same Site the possibilitiesof delays and costs from failures ofcooperation can lead to serious problems.

n The FIDIC Clauses may be adequate whenone Contractor is carrying out a highpercentage of the total work on the Site.

n

If the work is more evenly dividedbetween two or more Contractors, theprovision of the Contract need to bereviewed.


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Employers Claims

n If the Employer considers himselfentitled to any payment the Employer orthe Engineer shall give notice andparticulars to the Contractor.

n

The notice shall be given as soon aspracticable after the employer becameaware of the event or circumstancesgiving rise to the claim.

n

The particulars shall specify the Clauseor other basis of the claim, and shallinclude substantiation of the amountand/or extension to which the Employerconsiders himself to be entitled for theclaim.


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Employers Claims

n The Engineer shall then proceed in

accordance with theDetermination clause to agree or

determine:

The amount that the employershall be paid by the Contractor

n This amount can be deducted

from the Contract Price and

Payment Certificates.


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Employers Claims

n If the Employer deducts money from theContractor which he (the Employer) is notentitled to do, will enable the Contractor to

claim for all consequences of thedeductions.

n This could involve a substantial claim bythe Contractor. In such case, the Employer

would be advised to reserve his rights butnot to deduct any money until the finalresolution of this matter.


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Who is the Engineer?

n The Engineer is defined as the

person appointed by the Employerand named in the Appendix to

Tender. The word person can meana company, so the Engineer may benamed as a firm of Consulting

Engineers rather than an individual.


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n If the Engineer is a company, then

the company should designate anindividual to carry out the role of the

Engineer.


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n The Engineer has an extremely

important role in the administrationof the Contract and the way in which

he carries out his duties will have amajor impact on the work of theContractor and the success of the

project.


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Engineers Responsibilities

n (a) The Engineer shall carry out the

duties specified in the Contract.

n (b) Except as expressly stated in the

Contract, the Engineer shall have

no authority to relieve the

Contractor of any of hisobligations under the Contract.


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Engineers Responsibilities

n

(c) The Engineer may exercise theauthority specified in or necessarily tobe Authority implied from the Contract,provided, however, that if the Engineeris required, under, the terms of his

appointment by the Employer, to obtainthe specific approval of the Employerbefore exercising any such authority,particulars of such requirements shall

be set out in Part II of theseConditions. Provided further that anyrequisite approval shall be deemed tohave been given by the Employer forany such authority exercised by the

Engineer.


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Engineers Representative

n

The Engineers Representativeshall be appointed by and be

responsible to the Engineer andshall carry out such duties and

exercise such authority as may

be delegated to him by theEngineer

E i A th it t D l t


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Engineers Authority to Delegate

n The Engineer may from time to time

delegate to the EngineersRepresentative any of the dutiesand authorities vested in the

Engineer and he may at any timerevoke such delegation.n Any such delegation or revocation

shall be in writing and shall not take

effect until a copy thereof has beendelivered to the Employer and theContractor.

E i A th it t D l t


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Engineers Authority to Delegate

n Any communication given by the

Engineers Representative to theContractor in accordance with

such delegation shall have thesame effect as though it had beengiven by the Engineer. Provided

that:


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EngineersAuthority to Delegate

n Sub-Clause 2-3:

n (a) any failure of the EngineersRepresentative to disapprove any

work, materials or Plant shall not

prejudice the authority of theEngineer to disapprove such work,

materials or Plant and to giveinstructions for the rectification

thereof and,


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EngineersAuthority to Delegate

n Sub-Clause 2-3:

n (b) if the Contractor questionsany communication of the

Engineers Representative he may

refer the matter to the Engineerwho shall confirm, reverse or vary

the contents of suchcommunication


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Instructions of the Engineer

n The Engineer may issue to the

Contractor (at any time) instructionsand additional or modified Drawings

which may be necessary for theexecution of the works and theremedy of any defects, all in

accordance with the Contract


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Instructions of the Engineer

n The Engineer has the power to issueadditional or modified drawings. This

is an important power because manyContracts under the FIDIC Conditionsof Contract rely on a small number of

Drawings in the Tender documents


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I t ti i W iti


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Instructions in Writing

n Instructions given by the Engineer

shall be in writing, provided that iffor any reason the Engineerconsiders it necessary to give any

such instruction orally, theContractor shall comply with suchinstruction. Confirmation in writing

of such oral instruction given bythe Engineer, whether before orafter the carrying out of theinstruction.


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Replacement of the Engineern If the Employer intends to replace the

Engineer, the Employer shall not less than42 days before the intended date ofreplacement, give notice to the

Contractor of the name, address andrelevant experience of the intendedreplacement Engineer.

n The Employer shall not replace the

Engineer with a person against whom theContractor raises reasonable objectionwith supporting particulars.

Replacement of the Engineer


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Replacement of the Engineer

n However a change to the named

individual, when the Engineer is acompany, does not require this

notification.n Reasonable notice and discussion

would assist in efficient

administration.

Determinations


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Determinations

n The Engineer shall consult with each

Party in an endeavour (try) to reachagreement. If agreement is not

achieved, the Engineer shall make afair determination in accordance withthe Contract.

n The determination must express therights and obligations of the Parties

in accordance with the Contract and

the applicable law, regardless of the


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Construction Project[1]

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