Concurrent delay - voting page

Hi Andrew,

The one I have was that the client shoulder the cost related to time; cost to contractor and cost to the consultant.

There is no way for the consultant to be apportioned the cost since generally, they don’t have a budget for time.

With regards to the contractor, it will make them bankrupt if they will shoulder the cost.

Cheers,

charlie

Charleston,

It’s a difficult one. From the voting it appears that most people think that if both are causing delay, both should pay, or possibly niether should be penalised also - not unreasonable.

It’s the time bit I have difficulty in dividing between the two -
eg

say a contractor overuns by 4 wks due to his own delay and the employer has ordered extras that are done at the same time and these also take 4 wks. (and not worrying about the relative causes at the moment - lets say they’re equal for this discussion)

Do we say, both parties were in delay so the Contractor will get time related costs for 2 wks and the employer gets LD’s for 2 wks - easy but not alot of logic in it.

Do we say a reasonable time to complete the works was completion plus 4 wks because that’s the time it took to do the extra work. The Contractor can have 2 wks time related costs because he was also in delay but the Employer can’t recover any LD’s as the extra 4 wks were a reasonable time to complete the works.

or something different..........

Andrew,

My view on concurrent delay has always been that you should consider the delays as they occur in chronological order.

I base this on the belief that true concurrency requires the delays on two or more events to both start (cause) and finish (the end of the delay effect) at exactly the same time. As we all know, this rarely, if ever happens - what you have instead are delay causes that emerge one by one, with their delay effects overlapping. I don’t consider these concurrent delays but sequential.

So, in answering the original question, I say that you list out when the origins of the delay factors became known (i.e. when the work was instructed, that was the origin -not when it was done) and then produce the delay entitlement for each, chronologically. So, if the Contractor is due 4 weeks EoT for added work that was instructed early and also had his own problems that caused him, say 3 weeks delay, he is still entitled to the EoT for 4 weeks but only gets the prolongation coats for the one week.


John

John,

Yep, that would be the result of a T.I.A analysis, each delay being attributed to a particular event impacted sequentially as the story unfolds.

The thought behind my posting is that the majority favour some form of apportionment, which I don’t have any problem with - two people causing delay, two people pay (or not penalised), seems reasonable - but if apportionment was to be used, then how would it be best done?

As you correctly point out, you very rarely get concurrent delay using the method you describe, but you do obviously get periods when an Employer and Contractor delay are co-existent, ie occuring at the same time.

The age old arguement for this period about the Contractor would have had to be there anyway as he was in delay so why should the Employer pay any time related costs over and above those needed to carry out his extra work, etc.

The period where one delay exceeds the other is easy, the "longer delay" being the cause and that time period being attributed to that delay.

How to treat the period where they are co-existent is the bit that causes the arguement and would be the period that is apportioned by the relative cause I guess. The need to apportion time wouldn’t come into the equation but what costs do you allow to claim and counter claim for this period. LD’s are supposed to be the cost of the delay to the Employer, so should these be tkaen into acount for this period and set off against the Contractors costs. The net total then being apportioned?

Dear All,

I see the issue a bit more complex as of the actual events would be recorded, and would only be fairly conculded after the completion date to allow for a propoer anaylsis of the entitelments.

eg,

Say the Employer has caused 3 weeks delay to the completion date, while the Contractor caused the same 3 weeks, then the Contractor is definetely entiteled for the EoT BUT not for the associated costs, as he also participated equally in the delay.The Employer should live with that there will be no LD’s due for him.

However; if the Contractor has caused 4 weeks, then the contractor is fairly entitled for the 3 weeks E.o.T again without associated costs as he was in concurrent delay, the Employer will NOT be due for LD’s for those 3 weeks, however, the Contractor should pay a LD’s for the remaining week. and vis versa in case the Employer has caused the 4 weeks instead, the Contractor would get 4 Weeks EoT with the associated costs for one week only.

The Idea is that each party has to accept the loss generated from its causes of delay, the Employer will accept that he would lose his entitelement for the LD’s and the Contractor would lose the associated costs, simple but might be unequal !

The issue might get alot more complicated, say the there was a big event milestone (Christmas) and the Employer’s delay didnt cause the late openning of the HUGE MALL before chrismas, but the Contractor’s delay DID, here we have an issue ;-) ----> aribitration
However; different countries have different Contracts and different approaches, ...

Cheers All

Shamail,

Your shopping mall example throws up another question - if proportioning is to be used, is it the relative cause, or the relative effect that is taken into account?

Dear Andrew

To be honest, i haven’t yet experienced the proportionate solution in my career, however; as you might read between the lines of my previous post, i personally do not think that there should be any proportionate solution to either time or cost, its simply confusing and have no defined sharp lines.

If i was the aribitrator, yes i would certify an EoT for the Contractor for the duration that was in parallel with the Employer’s delay (with no extra cost),however; if the effect of the further delay caused by the Contractor has caused a loss to the Employer that is greator than the LD’s that the Contractor would be penalized for the remaining duration, then yes the Employer is entitled either for:
- The Full amount of LD’S calculated based on the total delay period (inclusive of the Employer caused delay).
OR
- The amount of the ACTUAL loss incurred by the Employer due to this delay (the Employer will submit these data to the aribtrator).

WHICH EVER IS LESS. (because the Employer should not be entitled for an amount that exceeds the total delay multiplied by the LD’s per unit of time as stipulated in the Contract) in any case.

Again this is my own idea, its not FIDIC or something else as you know ,,,

Cheers

Shamail,

You’re not wrong in your views, we all have our own ideas, but what I’m trying to get answers to in this thread is if the majority view was taken up, (ie proportioning due to relative cause) how best could we implement it?

Andrew

Let the people who voted for that explain to us ;-)

i just dont see a fair way of doing it ,,, i’ll keep watching if anyone post a reasonable way ,,,

Cheers

Shamail,

I started this thread in the hope that some good ideas might be put forward, I’m sure there’s people out there with some on PP, but the response has been alittle muted to date.

Andrew,

I think people who voted didnt know what they voted for mate ;-)

No body has any idea why and how ?

Cheers

Shamail,

Have more faith!!!!!!!!!!! (could be my famous last words)

Actually I’m more surprised the number of people who have voted for time is greater than those who have voted for costs! I guess money can’t be as important!!!!! (tounge in cheek)