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PROJECT NAME EXTENSION OF TIME CLAIM No. 2 INTERIM PARTICULARS 25 July 2012 Volume I Claim Narrative Project Name Extension of Time Claim No. 2 CONTENTS 1 Executive Summary 4 2 Introduction 5 3 Background 6 3.1 Contract Agreement 6 3.2 Conditions of Contract 6 3.3 Contractual Parties 6 3.4 Other Par...

Description

PROJECT NAME

EXTENSION OF TIME CLAIM No. 2

INTERIM PARTICULARS

25 July 2012

Volume I Claim Narrative

Project Name Extension of Time Claim No. 2

CONTENTS 1 2 3

Executive Summary Introduction Background 3.1 Contract Agreement 3.2 Conditions of Contract 3.3 Contractual Parties 3.4 Other Parties 3.5 Contractual Obligations 3.6 Time for Completion 3.7 Liquidated Damages 3.8 Entitlement to Extension of the Time for Completion 3.9 Contractor Claims 3.10 Notification of Delay Events 3.11 Programme for the Works

4 5 6 6 6 6 7 8 11 11 12 13 16 16

4

Delay Events 4.1 General 4.2 Delays, Impediments or Acts of Prevention by the Employer 4.2.1 Late Procurement of Ceramic Tiles

16 16 16 17

5

Delay Analysis 5.1 Method

21

6

Mitigation

22

7

Entitlement

23

Major Appendices No.

Title

1

List of Abbreviations

Page Ref.

Appendix Location

5

Vol II

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Executive Summary

The Agreement between Line Investments and Property L.L.C. (The Employer) and CONTRACTOR (the Contractor) that was signed on ?? 2008 for the construction of the Fish, Vegetable, Meat Market and Shopping Mall in Abu Dhabi (the ‘Works’) is a Lump Sum Contract whereby the Contractor is responsible for executing and completing the Works and has a fundamental contractual obligation to complete the whole of the Works by 12th January 2010, 22 months after the Commencement Date of 12th March 2008. However, approximately 11 months after the Commencement Date the Employer, amongst other things, nominated a subcontractor to design, fabricate and install skylight SK1. The timing of the nomination, subsequent delays in finalising the Subcontract and the late approval of shop drawings had a considerable impact on the progress of the Works and the ability of the Contractor to be able to complete the Works by the due date. This document comprises interim particulars of a claim for an ?? Day extension to the Time for Completion, resulting from delay events described in this document. The date for completion is revised accordingly as follows: Milestone

Date for Completion Contract Revised

Extension Claimed

1 2

12 Sep ’09 12 Jan ‘10

?? Days ?? Days

Hand over Retail Areas to Tenants Hand over Complete Project

?? ??

The Contractor intends to submit further extension of time claims covering other delay events. Costs associated with the claim for an extension of time are not included in this document and will be presented in a separate submission in due course.

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Introduction

This document demonstrates the Contractor’s entitlement to an extension of the Time for Completion. Costs associated with the extension of time have yet to be calculated to a degree of accuracy required by the Conditions of Contract and so have been excluded from this document. These costs will be calculated and submitted in due course. This document refers to various events which have caused delay. Although it must be recognised that these are not the only events that have given cause for delay, they are, in the Contractor’s opinion, the primary issues. The Contractor reserves the right to submit further claims referring to other events which have also given rise to delays. It must therefore be understood that this document is not exhaustive. Other delay events will be the subject of separate extension of time claims. Where documents are referred to in this document, they are attached as appendices. The footnote reference corresponds to the Appendix reference. A list of abbreviations that appear in this document can be found in the List of Abbreviations Appendix1.

1

Appendix

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Background

3.1

Contract Agreement

The Agreement for the Works was signed by The Employer and the Contractor on ?? 20082. This Agreement identified the Time for Completion as being 24 months3 and the Contract Price as being AED 000,000.00. A Memorandum of Understanding4 was subsequently signed by both Parties reducing the Time for Completion to 22 months in order to reflect the value engineering exercise changing bored piles to a raft foundation. 3.2

Contract Documents

The following documents comprise the Contract Documents: (a) (b) (c) (d) (e) (f) (g) (h) (i) (j)

(k)

The letter of Acceptance5 The Instructions to Tenderers The Form of Tender and Appendices dated 2nd September 2007 The Agreement and Appendix The Conditions of Contract (Parts I and II) The Project Description & Scope of Works The Specifications The Bill of Quantities The Drawings Tender Addenda and Clarifications Addendum 1 Ref. 000169/07 12th August 2007 Addendum 2 Ref. 000183/07 16th August 2007 Addendum 3 Ref. 000202/07 27th August 2007 Clarification 1 Ref. 000162/07 6th August 2007 Clarification 2 Ref. 000188/07 20th August 2007 Any other documents forming part of the Contract

As provided for in the Conditions of Contract6, the documents forming the Contract are to be taken as mutually explanatory of one another.

2

The Agreement Item 6 of Appendix “A” to the Agreement 4 Item 2 of Memorandum of Understanding dated 6th March 2008. 5 LI letter dated 14th January 2008 6 Sub-Clause 5.2. 3

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Background (Cont’d)

3.3

Conditions of Contract

The General Conditions of Contract are the Conditions of Contract for Works of Civil Engineering Construction (Fourth Edition 1987) reprinted in 1992 with further amendments as prepared by the “Federation Internationale Des Ingenieurs-Conseils (FIDIC)” and amended by Conditions of Particular Application. Clauses of the “Conditions of Particular Application” take precedence over the clauses of the “General Conditions of Contract”.

3.4

Contractual Parties

The Agreement confirms that the contract is between the Employer and the Contractor (CONTRACTOR).

3.5

Other Parties

3.5.1

The Engineer

The Engineer is ENGINEER (THE ENGINEER), which fulfils a management role as defined in the Contract Documents7.

3.5.2

Project Manager

The Project Manager (PROJECT MANAGER). Although this organisation has no formal role under the Contract, it plays an active role in the implementation of the Works.

7

Clause 2

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Background (Cont’d)

3.6

Contractual Obligations

The Contractor’s general responsibilities, as set out in Sub-Clause 8.1 of Conditions of Contract, are:

The Contractor shall, with due care and diligence, design (to the extent provided for by the Contract), execute and complete the Works and remedy any defects therein in accordance with the provisions of the Contract. The Contractor shall provide all superintendence, labour, materials, Plant, Contractor’s Equipment and all other things, whether of a temporary or permanent nature, required in and for such design, execution, completion and remedying of defects, so far as the necessity for providing the same is specified in or is reasonably to be inferred from the Contract. The Contractor shall give prompt notice to the Engineer, with a copy to the Employer, of any error, omission, fault or other defect in the design of or Specification for the Works which he discovers when reviewing the Contract or executing the Works. The Contractor’s obligations regarding site operations and methods of construction, as set out in Sub-Clause 8.2 of Conditions of Contract, are:

The Contractor shall take full responsibility for the adequacy, stability and safety of all Site operations and of all methods of construction. Provided that the Contractor shall not be responsible (except as stated hereunder or as may be otherwise agreed) for the design or specification of Permanent Works, or for the design or specification of any Temporary Works not prepared by the Contractor. Where the Contract expressly provides that part of the Permanent Works shall be designed by the Contractor, he shall be fully responsible for that part of such Works, notwithstanding any approval by the Engineer.

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Background (Cont’d)

3.5

Contractual Obligations (Cont’d)

A detailed description of the Project, as set out in Part I of the Particular Specification, is:

1

INTRODUCTION The project is located on Plot A, Sector a-F2 between intersections I73 and I46 on Airport Road.

2

DESCRIPTION •

The PROJECT will be a state-of-the-art fish, meat and vegetable market. Each shop is individually equipped with all facilities. The public and service areas are completely segregated by providing separate service corridors at the back of all shops. A large entrance, huge public lobbies and all modern facilities provided make it a very hygienic and odour-free place. It has a separate loading/unloading area accessible from the street • The mall is equipped with panoramic elevators, travelators and escalators and service lifts • Facilities like restaurants, food courts, specialty shops and a large hypermarket will cater for visitors • 2180 Car parking spaces in total A

Basement Floor • Underground parking lot for 1105 cars • Three separate entrances and exists for ease of traffic • Four entrance halls providing travelators, escalators and lifts for the fish market and mall • Stores, electrical and telephone rooms

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Background (Cont’d)

3.6

Time for Completion

The Time for Completion for the whole of the Works was established as being 22 Months from the Commencement Date of 12th March 20088. The completion date for the whole of the Works is therefore calculated as 12th January 2010. The Agreement documents include the following critical Milestones: Milestone • •

3.7

Hand over Retail Areas to Tenants Hand over Complete Project

Period (Months) 189 2210

Date 12 Sep ‘09 12 Jan ‘10

Liquidated Damages

In the event that completion is delayed, without the Contractor having any entitlement to an extension to those dates, the Conditions of Contract11 provides for the imposition of delay damages by the Employer as follows: Amount of Liquidated Damages for delays in the completion of the Work: •

Amount per Day:

•

Maximum Amount: 10% of the Contract Price13

AED 15,00012

Amount of Monthly Supervision Charges14 •

Amount per Month: AED 1,666.6715

8

Item 2 of Memorandum of Understanding dated 6th March 2008. 9 Item 6 of Appendix “A” to Agreement 10 Item 2 of Memorandum of Understanding dated 6th March 2008. 11 Sub-Clause 47 12 Item 15.1 of Appendix “A” to Agreement 13Item 16 of Appendix “A” to Agreement. 10% of AED 1,000,000 = AED 1,000,000 14 Based on the original Contract Price and the original Time for Completion 15 Item 15.2 of Appendix “A” to Agreement. 2.5% of AED 1,000,000/24 months = AED 1,666.67

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Background (Cont’d)

3.8

Entitlement to Extension of the Time for Completion

The Contractor’s entitlement to an extension of the Time for Completion, and thereby relief from any liability for Liquidated Damages, arises from Sub-Clauses 44.1 to 44.3 of the Conditions of Contract as follows: 44.1

In the event of: a)

The amount or nature of extra or additional work,

b)

Any cause of delay referred to in these Conditions,

c)

Any delay, impediment or prevention caused by the Employer, or

d)

Other special circumstances which may occur, other than through a default of or breach of contract by the Contractor or for which he is responsible,

Being such as fairly to entitle the Contractor to an Extension of the Time for Completion of the Works, or any Section or part thereof, the Engineer shall, after due consultation with the Employer and the Contractor, determine the amount of such extension and shall notify the Contractor accordingly, with a copy to the Employer. In order to determine the amount of such Extension, the Engineer may request that the Contractor prepares a “Time Impact Analysis” for adjustment of the Completion Dates identified in Appendix to the Form of Tender. The Time Impact Analysis shall define the extent of adjustment, and the basis therefore, in a form acceptable to the Engineer and shall include (but shall not be limited to): •

Identification of activities which will require change, and

•

An analysis of how float has been used to minimise the additional time required.

The Time Impact Analysis shall indicate the date(s) any extra or additional work or other special circumstances occurred, the status of the work at that time, and resultant impact on the Completion Dates as per the corrected programme.

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Background (Cont’d)

3.8

Entitlement to Extension of the Time for Completion (Cont’d)

44.2

Provided that the Engineer is not bound to make any determination unless the Contractor has:

44.3

b)

Within 28 days after such event has first arisen notified the Engineer with a copy to the Employer, and

c)

Within 28 days, or such other reasonable time as may be agreed by the Engineer, after such notification submitted to the Engineer detailed particulars of any extension of time to which he may consider himself entitled in order that such submission may be investigated at the time.

Provided also that where an event has a continuing effect such that it is not practicable for the Contractor to submit detailed particulars within the period of 28 days referred to in Sub-Clause 44.2(b), he shall nevertheless be entitled to an extension of time provided that he has submitted to the Engineer interim particulars at intervals of not more than 28 days and final particulars within 28 days of the end of the effects resulting from the event. On receipt of such interim particulars, the Engineer shall, without undue delay, make an interim determination of extension of time and, on receipt of the final particulars, the Engineer shall review all the circumstances and shall determine an overall extension of time in regard to the event. In both such cases the Employer shall make his determination after due consultation with the Employer and the Contractor and shall notify the Contractor of the determination, with a copy to the Employer. No final review shall result in a decrease of any extension of time already determined by the Engineer.

In addition to Sub-Clause 44.1, the following Sub-Clauses also give entitlement to extensions to the Time for Completion: 6.4 36.5 40.2 42.2 69.4

Delays and Cost of Delay of Drawings Engineer’s Determination where Tests not Provided for Engineer’s Determination following Suspension Failure to Give Possession Contractor’s Entitlement to Suspend Work

As will be seen from later sections of this document, the Contractor is clearly entitled to an extension to the Time for Completion and therefore contractually will have no liability for Liquidated Damages.

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Background (Cont’d)

3.9

Contractor’s Claims

Clause 53 of the Conditions of Contract sets out the following procedure for claims:

53.1

Notwithstanding any other provision of the Contract, if the Contractor intends to claim any additional payment pursuant to any Clause of these Conditions or otherwise, he shall give notice of his intention to the Engineer, with a copy to the Employer, within 28 days after the event giving rise to the claim has first arisen.

53.2

Upon the happening of the event referred to in Sub-Clause 53.1, the Contractor shall keep such contemporary records as may reasonably be necessary to support any claim he may subsequently wish to make. Without necessarily admitting the Employer’s liability, the Engineer shall, on receipt of a notice under Sub-Clause 53.1, inspect such contemporary records and may instruct the Contractor to keep any further contemporary records as are reasonable and may be material to the claim of which notice has been given. The Contractor shall permit the Engineer to inspect all records kept pursuant to this Sub-Clause and shall supply him with copies thereof as and when the Engineer so instructs.

53.3

Within 28 days, or other such reasonable time as may be agreed by the Engineer, of giving notice under Sub-Clause 53.1, the Contractor shall send to the Engineer an account giving detailed particulars of the amount claimed and the grounds upon which the claim is based, Where the event giving rise to the claim has a continuing effect, such account shall be considered to be an interim account and the Contractor shall, at intervals as the Engineer may reasonably require, send further interim accounts giving the accumulated amount of the claim and any further grounds upon which it is based. In cases where interim accounts are sent to the Engineer, the Contractor shall send a final account within 28 days of the end of the effects resulting from the event. The Contractor shall, if required by the Engineer to do so, copy to the Employer all accounts sent to the Engineer pursuant to this Sub-Clause.

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Background (Cont’d)

3.9

Contractor’s Claims (Cont’d)

Clause 53 (Cont’d)

53.4

If the Contractor fails to comply with any of the provisions of this Clause in respect of any claim which he seeks to make, his entitlement to payment in respect thereof shall not exceed such amount as the Engineer or ‘The Court of Abu Dhabi’ assessing the claim considers to be verified by contemporary records (whether or not such records were brought to the Engineer’s notice as required under Sub-Clauses 53.2 and 53.3).

53.5

The Contractor shall be entitled to have included in any interim payment certified by the Engineer pursuant to Sub-Clause 60 such amount in respect of any claim as the Engineer, after due consultation with the Employer and the Contractor, may consider due to the Contractor provided that the Contractor has supplied sufficient particulars to enable the Engineer to determine the amount due. If such sufficient particulars...