CONSTRUCTION CONTRACTUAL CLAIM
By (Name)
Name of the Class (course)
Professor
Name of the University
City and state of the university
Date
Contract Claim 2
Table of Contents
I. Executive Summary 2
II. Table of Causations 2
III. Introduction 5
IV. Contract Representations 6
VIII. Quantification of the claim 12
IX. Formal claim statement 13
X. Appendices 13
Contract Claim 3
I. Executive Summary
The project in reference is a road construction of the new N16 National Primary Road
between Sligo and Manorhmilton (approximately 3km works) between the town lands of
Drumkiisellagh and Lugnagali. The works are being constructed under Public Works Contract
PW-CF3, for civil works designed by the employer. The CCR No. and NOC No. is 004. The
programme contingencies have been identified in the contract as T1=20 Working days, T2=20
Working Days.
The purpose of this claim is extension of time for completion of the construction by
addition of 15 more weeks and liquidated damages of €150,000. Extension of completion time
with 15 more weeks will result in extension of the completion date to 30/03/2024. The claim is
based on delays occasioned by inconsistencies in the geotechnical report, strike of sub-
contractors, prohibition notice issued by the Health and Safety Authority, extra entrances by the
employer and identification of an archaeological site of national importance.
II. Table of Causations
Item Cause of delay Delay
period
Impact
of
delay
Liquidated
damages
1 Inconsistencies in the geotechnical report. A rock
that had been identified in the report has been
located along the route. The rock’s hardness is 5-
6 on Mohr’s Hardness Scale. A greater cost of
approximately 50% will be incurred over the
budgeted amount. There will be a delay due to
slower pace in breaking the critical element.
3 weeks €10,000
per week
Contract Claim 4
Peat soils identified. The employer gave
instructions for removal of the peat soils and
replacement with imported material.
4 weeks
Discovery of archaeological site of national
importance. Excavation and extraction will result
in delay
3 weeks
Subcontractors strike due to employer’s failure to
pay for their labour.
5
working
days
Employer requested for extra entrances causing
disruptions to the schedule of works. Unmarked
services are located during some of the extra
works
4 weeks
Employer’s claim under C10.9 to reduce the
contract sum
Health and Safety Prohibition notice 5
working
days
Contract Claim 5
III. Introduction
The contracting parties are Gavin Miller as the contractor and the county government as the
employer. The project which is subject to this claim is a road construction project. The road to be
constructed is the new section of N16 National primary road between Sligo and Manorhamilton
(approximately 3km). The contract involves the following:
• Circa 2.54km of realignment to the existing N16 National Primary Route (c. 0.79km online and
c. 1.75km offline);
• Junction Improvements including: o One At Grade Roundabout; o Six Simple T Junctions,
including two Right/Left Staggered T Junctions;
• Circa 1.5km of realignment to the existing local road network (tie-in works);
• Three Direct Access connections to the National Primary network;
• Circa 1.5km of Vulnerable Road Users (Unsegregated cycle and pedestrian) tracks located
predominately with the mainline verge space, interlinking as necessary with alternative offline
routes;
• One Vulnerable Road Users Subway underpass;
• One River/Stream Clear Span Structure;
• Culverts and associated diversions of existing minor watercourses and drainage ditches;
• All the necessary drainage works associated with the Proposed Road Development;
• The diversion of services and utilities;
• Earthworks operations;
Contract Claim 6
• One no. steepened cut side slope in the townland of Lugatober;
• One no. Soil Repository/Borrow Pit;
• Environmental mitigation works;
• The other consequential construction works necessary in order to complete the project.
The ground conditions were identified in a geotechnical report that was presented to me
without any interpretation. The works are been constructed under Public Works Contract PW-
CF3,for civil works designed by the county government. The works had been scheduled to start
on 1/1/2021. This was not the case due to a number of issues with residents and eviction
procedures. The contract got started 8 weeks later which translated to 26/2/2021. The covid-19
pandemic hit and the works were suspended in consequence. Construction works were officially
allowed to begin on 8/3/2021. The delay actually favoured me because I was able to complete
other pending projects that were already at the completion phase. Additionally, I was able to get
plant and machinery in preparation for the commencement of the works.
In addition to covid-19 pandemic, the county government had not completed all of the
specifications by 1/1/2021 making it impossible for the work to commence at that date.The
overall programme of the work is scheduled to take 104 weeks and was due to be completed by
31/12/2023. Due to the delays occasioned by notices, inconsistencies in the geotechnical report
and sub-contractors strike, the works are likely to be completed on 30/03/2024.
IV. Contract Representations
Express representations
Contract Claim 7
Schedule 1K clause 15 provides for allowance of delay caused by order or other act of a
court or public authority which was not occasioned by the breach of legal requirements of the
contractor. The extension of the starting date to 8/03/2021 due to the covid-19 pandemic, was
caused by a public order issued for commencement of all construction works on 8/03/2021. This
event is grouped as a delay event but not an event worth compensation.
Clause 18 of schedule 1K also provides for a delay event in event of discovery of an item
of archaeological interest or human remains found in the site if it was unforeseeable. The
contractor discovered an artefact of national importance that had not been identified in the
documentation. The excavation and removal of the artefact would result in a delay of three
weeks. Schedule 1K does not warrant compensation for a discovery of this sort. Since the
schedule does not provide for compensation I only claim for extension of the works completion
time with three weeks.
Factual error in information about the site in the works requirement is also a basis for
delay. In addition to being a delay event, it is also a compensation event. This information is
covered in clause 5 of Schedule 1K. A rock has been located along the route that was not
identified in the Geotechnical report. The rock’s hardness has been measure in the Mohr’s
hardness scale and is 5-6. The rock will requires significantly larger rock breakers to be used.
The cost to be incurred will be 50% more than the amount I had budgeted. Further, the hardness
of the rock will lead to a slower pace in breaking the critical element, resulting in a three weeks
delay.
There are also some peat soils which have been identified in the geotechnical report. The
employer has given instructions for removal of the peat soils in their entirety and replacement
with imported material. I have however send the employer a value engineering proposal for the
Contract Claim 8
peats to be left in site and the road to be piled. This will however result in incurring extra cost on
my side since specialist designers are required for the work. Employing and remunerating the
specialist designers will cost me quite a fortune. I am therefore claiming for compensation based
on clause 11 of Schedule 1K. Working on the peat soils problem will result in a longer lead in
time occasioning a delay of three weeks.
Clause 17 of Schedule 1K provides for compensation in event that there is a difference
between the contract value for works according to the works and descriptions. The difference
should be more than €500. The employer has launched a claim under clause 10.9 to reduce the
contract sum. The basis for this claim is that I used medium density polyethene pipe to avoid the
installation of bends and thrust blocks to be installed in the water main. The ER agreed with my
proposal and that the change will improve the integrity of the pipeline and meet the county
government’s requirements. The county government instituted the claim to reduce the contract
sum but this will also be a basis for my compensation since it is a compensation event in the
contract.
The county government took over parts of the works before the substantial completion by
adding extra entrances which resulted in disruption in the work schedule. The basis for a
compensation and delay claim is clause 6 of schedule 1K. Unmarked services have been located
during some of the extra works. Working around the services as stipulated by the County
Government has resulted in significant disruption in the work progress. The section of the work
was originally programmed to be completed in 16 weeks but the rate of progress has reduced to
80%. This will warrant a delay of approximately 3 weeks. Additionally, there will be
compensation for this as provided in schedule 1K.
Contract Claim 9
Clause 8 of schedule 1K provides for a delay and compensation event when an employer
denies the contractor access to a specific part of the site. The employer was issued with a
prohibition notice for parts of the site until safety measures are put in place to prevent accidents.
The accident that resulted in issuing of the notice was an accident where a trench in which a man
had been working a few minutes earlier collapsed. The prohibition notice resulted in a delay of 5
working days.
Implied representations
There are some workers brought on board by a subcontractor whom I have not interacted
with before. The subcontractor’s workers have not been paid in accordance with clause 5 of the
contract. This has resulted in the strike and picketing of the subcontractor’s workers. The other
workers on the site refused to pass on the picket. The standoff between the subcontractor and his
staff lasts up to 5 working days. The subcontractor should be aware of the implied duty to
cooperate with the other contracting parties in the work performance. Further, I am entitled to the
right of performance of my work without hindrance from other contracting parties.
V. Contractor’s plan
In my initial plan, the construction was to take 104 weeks without any hindrances or
interferences. I was to employ only the resources that I obtained for purposes of the work
without inclusion of any emergency funds or resources. I was ready to fully rely on the
geotechnical report as it was. I had assumed that the geotechnical report was accurate and the
works would be conducted in line with the report analysis.
My original budget was €3,500,000. I had allocated €1.5 million for purchase of
construction equipment like shovels, cement, sand and other construction related equipment. The
Contract Claim 10
remainder was allocated to remuneration for the workforce or labour that I employed for the
construction works. The workforce team includes; the architect, engineer and the builders. I had
set the commencement date for the works as 26/2/2021 and completion date was 31/12/2023.
Table shows my original budget plan.
VI. Actual Conditions
Originally, the programme was to be completed on 31/12/2023. This may however be
impossible due to delays occasioned by various events that will be clearly outlined below. The
commencement date was also set for 26/2/2021 but this was not the case due to a delay event
equivalent to an act of God, covid-19 pandemic. Consequently, the works began on 8/3/2021 in
accordance with the order issued by the government.
The first cause of delay and claim for time extension is discovery of an artefact of
national importance in the site. An artefact of national importance was discovered in the site
before beginning of the construction. The artefact had not been identified in the geotechnical
report. Excavation and extraction of the artefact will result in a three weeks delay.
The second delay event is the presence of peat soils in the site. I made a proposal for the
peat soils to be left in the site and the road to be piled. Specialist designers will be required for
the work and an extra cost will also be incurred. Undertaking of the proposal of piling of the
roads would result in a four weeks delay in progress of the works.
Contract Claim 11
The third delay event is the subcontractor’s workers strike. The strike and picketing has
been caused by failure by the subcontractor to remunerate the workers in accordance with clause
5 of the contract. The standoff between the subcontractor and his workers resulted in a delay of 5
working days.
The fourth delay event is discovery of a rock along the route where the construction was
to take place. The rock had not been identified in the geotechnical report. It was weighed in the
Mohrs’ hardness scale and measured 5-6. The delay will be caused by the time taken in breaking
the critical element. The effect is a three weeks delay.
The fifth delay event is the employer’s request for extra entrances in the works. Inclusion
of the extra entrances has resulted in unmarked services located during some of the extra works.
This inclusion and addition has resulted in a disruption in the work schedule. The section of
work was to be completed in 16 weeks but there will be a decrease of the rate of progress to
80%.
The last delay event is the prohibition notice issued by the Health and Safety Authority.
The notice was issued after an accident had occurred in which a man had been working in a few
minutes earlier happened to collapse. The notice was in operation until a safe system of work
was instituted to protect the workers. The result was a delay for 5 working days.
The above delays are the actual conditions in relation to the construction site and the
construction progress. The construction will not be completed on the set completion date due to
the above factors. I request for extension of the completion time to 30/03/2024 which is the most
convenient date after factoring in the delay period. Additionally, I will be forced to bring in a
Contract Claim 12
specialist designer which will result in an increase in my expenses and exceed my budget. The
contract sum should thus be adjusted to read €10 million due to the additional costs incurred.\
The compensatory events which are: peat soils identified, rock identified that had not
been identified in the geotechnical report, employers interference and subcontractor’s negligence
will warrant liquidated damages worth €10,000 per week.
Table shows the difference between the original program and the amended program.
VII. Legal Entitlement
In reference to the differing site conditions clause and based on the arguments set above, I am
entitled to a time extension, and liquidated damages. The time extension is justified by the causes
of delay outlines above. Liquidated damages is justified by the additional expenses I will incur
and also the occurrence of the compensatory events as set out in schedule 1K of the contract
agreement. There has been a breach of both express and implied terms and conditions in the
contract. The contract terms breached are outlined in the contract representations section above.
I am entitled to liquidated damages of €10,000 per week as will be quantified below. Further, I
am entitled to a time extension for the completion of the contract. I have filed this claim within
the stipulated time limits in construction contract claims.
VIII. Quantification of the claim
The employment of a specialist designer for road piling was not included in my budget. The
costs that will be incurred in employing the designer and any other costs in relation to the
specialist designer were unallocated as evidenced in my plan’s cost allocation. The effect of
hiring the specialist designer is an increase in the expenses and cost. The approximate cost to be
incurred on hiring a specialist designer is €20,000.
Contract Claim 13
A significant cost was also incurred in installing the medium density polyethene pipe. This
exercise was carried out in avoidance of installation of bends and thrust blocks. Medium density
polyethene pipes was not in the list of the type of pipes I intended to purchase and the cost
incurred in their purchase was thus outside my budget. The pipes cost approximately €10,000.
IX. Formal claim statement
The main reason for this claim is seeking for extension of the completion time, increase in
the contract sum and compensation in form of liquidated damages for the delay events and other
factors listed above. The delay events will warrant an extension foe the time for completion of
the contract.
X. Appendices
The following tables are a representation of the claim presented above.
Table 1.
Item Budgeted amount
Construction equipment
Cement
Sand
Gravel
Excavators
Graders
Tippers
€1.5 million
Contract Claim 14
Construction vehicle
Wheelbarrow
Plumb bob
Workforce
Architect
Engineer
Supervisor
Electrician
Construction manager
€1 million
Table 2.
Item Original
programme
Delay events Start date End date Delay
period
Disrupted
program
me
1 Completion
date was
31/12/2023
Strikes by
subcontractor’s
workers
Artefacts
excavation
Rock discovery
24/04/2021
24/03/2021
15/04/2021
25/04/2021
14/04/2021
5 working
days
Three
weeks
Three
The
completio
n date
should be
extended
to
Contract Claim 15
Piling of peat
soils
Prohibition
notice
Interference by
the employer
8/05/2021
12/06/2021
6/05/2021
5/06/2021
17/06/2021
weeks
Four
weeks
Five
working
days
30/03/202
4
CONCLUSION
Construction contract claims are easier to frame compared to other contract claims. This
is evidenced by the flexibility in the mode of framing the frame. As compared to other standard
form contracts, construction contract claims have liquidated damages and time extension clauses.
Force majeure clauses are also necessary in most construction contracts since construction
industry is exposed to many unforeseeable risks.
Contract Claim 16
Additionally, facts and support of the facts matters more in a construction contract claim.
Most contractual claims have many case laws which is not the case in construction contract
claims.
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