Contract delay 6

[brnt]

I am a site inspector on a project where the contractor wants to be paid for down time due to a delay. The contract clearly states he can be paid for costs for a delay caused by the owner or their representatives. Basically a rough grading contractor ran into some under ground springs and the engineering firm was to come up with a stradegy for dealing with them. The engineering firm hummed and hawed and danced around but didnt come up with an answer for 2 weeks. The contractor did all they could and then had to sit for 7 days waiting for an answer. They parked their equipment and sent their men elsewhere. They have sent a bill for the 7 days the equipment was sitting idle. The hourly rate for the equipment includes an operator, but their operators were not onsite.Should they get paid the full hourly rate or should there be a discount because their operators were not onsite?

 

[flight7]

brnt - In your last reply you seem to be saying that the geotechnical engineer did a reasonable investigation, and that it was reasonable to miss the spring.

It seems to me that the Owner owns the site, so he owns the spring unless someone else bears some responsibility for it. If the engineer isn't responsible, and the contractor certainly isn't responsible, then it's the owner's problem.

 

[concretemasonry]

There is also one point missed that affects the labor cost and other equipment charges.

Since there is no work, the personnel can be assigned to work on other jobs if there is equipment or they may work overtime on available equipment at a premium rate to avoid unemployment costs, which is probably less cost to a contractor, but it is still a cost incurred due to the delay.

Also, the mobilization and movement of equipment to another project can be very substantial, depending on the type of equipment, especially if is oversize. Moving the equipment is usually not an option for a contractor unless there is a reasonable prediction of when it will be possible to return to work, which is controlled by the engineer in the end. Whether the equipment is operating or not the cost of ownership is a reasonable cost that continues, unless it is an act of God.

At least the owner was not really directly involved in the project control/management, which can complicate the damages, since you, as an inspector was an agent of the owner(or engineering firm) and fell under the umbrella of an "agent" for the owner.

Dick

Engineer and international traveler interested in construction techniques, problems and proper design.

 

[BigInch]

It wasn't missed. A court would automatically assume that all such considerations were included in the rates, or the lump sum price, that was part and parcel of the signed contract, unless the owner could prove otherwise. The burden of proof would be entirely on the owner to show beyond doubt that he is entitled to a reduced rate for standby time. That will be especially difficult if any rate at all, op or standby, was specified. All the contractor will have to do is agree with the court's opinion. There is a reason why they call it a "burden". It won't be easy to prove that one.

Unfortunately, if the owner is adament about persuing a fight, he would have a far better chance of going after the engineer, where there is a much better chance of finding open ends, especially if the engineer was significantly involved with the geotechnical investigation. If the engineer even happened to point to where one hole were to be drilled, he should be running for cover right now. He would be forced to present irrefutable evidence proving that the planned investigation, in almost every imaginable circumstance, was sufficiently detailed and properly layed out to almost positively guarantee that any such spring would normally be discovered.

"People will work for you with blood and sweat and tears if they work for what they believe in......" - Simon Sinek

 

[Hoaokapohaku]

One of the most important aspect of any construction contract is how it assigns risk. This one clearly puts the risk for these kinds of delays on the owner. Usually, contracts spell out exactly how the compensation for standby equipment costs is determined. I've never seen a contract where the contractor gets compensated for an operator when the equipment is idle on site. However, if this contract includes the operator cost, that's just the way it is regardless of anyone's opinion of whether that SHOULD be compensated.

 

[BigInch]

[sub]Another reason to read the fine print.[/sub]

"People will work for you with blood and sweat and tears if they work for what they believe in......" - Simon Sinek

 

[dik]

Heheehhehehe

Dik