HKIS

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HKIS PQSL TALK DISRUPTION CLAIM RECORD
KEEPING

Presented by C Y Fung
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Disruption vs. Prolongation Due to Delay

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Prolongation Claims
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3. Disruption Claims
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Definition of Disruption

• Disruption (as distinct from delay) is
  disturbance, hindrance or interruption to a
  Contractors normal working methods, resulting in
  lower efficiency. If caused by the Employer, it
  may give rise to a right to compensation either
  under the contractor or as a breach of contract.
  
• SCL EOT Protocol

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DISRUPTION CLAIMS

• Disruption in its simplest sense is a loss of
  productivity a reduction in the output of
  construction resources, those being, primarily,
  labour and plant.
• A disruption claim is not a claim for
  prolongation of the Works.
• Disruption can also be caused by a delay but the
  delay may or may not occur on the critical path.

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Sample Project 1 - Original Working Programme
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Planned progress by trades
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Sample Project 1 As-Built Programme
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Actual progress by trades
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Comparison planned actual Actual progress by
trades
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CVIs by room affected
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Issues From Sample Project 1

• Late Possession late start and delay in
  completion.
• Piece-meal possession delay in completion and
  loss of productivity.
• Water leakage by MC Abortive works and impact
  on progress delay.
• Late verbal instructions Belated ordering of
  variation works delay.
• What records do we have to substantiate our
  entitlements ?

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DISRUPTION CLAIMS

• How Engineering Services Ltd v Linder Ceilings,
  Floors and Partitions plc (1999) 64 CLR 67
• Demonstrated that on parts of the works where a
  similar activity was not subject to the
  disruption claimed, the contractor achieved his
  planned output, thereby demonstrating that, but
  for the events notified, the additional cost of
  performing the activity would not have arisen.

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Whittal Builders Company Ltd v Chester-Le-Street
District Council (1985) 11 CLR 40
DISRUPTION CLAIMS

• Evaluation of disruption was carried out on the
  basis of a comparison of productivity prior to
  the disruptive events taking place, compared with
  that achieved during the period of disruption.
  In this case the comparison of outputs was made
  by assessment of sums certified within interim
  payment certificates.

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DISRUPTION CLAIMS

• The greatest problem with disruption claims is
  to prove that Employer caused the disruption,
  and that it was not due to the Contractors own
  inefficiencies or delays.

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Disruption Claims
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Sample Project 2 Disruption to Progress But No
Delay
1. Identify events causing the productivity loss
produce proof/records
2. Show productivity level at undisrupted period
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Measured Mile Approach

• The most appropriate way to establish disruption
  is to apply a technique known as the Measured
  Mile. This compares the productivity achieved
  on un-impacted part of the contract with that
  achieved on the impacted part. Such a comparison
  factors out issues concerning unrealistic
  programmes and inefficient working - Identical
  to Duncan Wallaces approach

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4. Record Keeping Strategy
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Brief the Team Members

• Detailed handover of risk schedule and tender
  philosophy.
• Clear concise commercial strategy.
• Commercial awareness meetings / workshops.
• Involve the complete team.
• Build relationships.

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Importance of working as an integrated team the
3 Cs

• Communication
• Regular meetings / Site Walks
• Levels of communication
• Coordination
• Responsibility for Commercial and Operations
• Consistency
• Knowledge and understanding of the basic Contract
  requirements / Forms / Record sets will allow for
  a consistent approach by the entire Project Team.

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Records / Forms

• Different record sets / forms that are both
  required under the Contract and form the basis of
  applications for payment, measurement and
  valuation of variations and preparation of
  claims.
• Fulfill the Contract
• Manage Costs
• Achieve Maximum Value

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Records / Forms (contd)
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WORKING TOGETHER
Operations Team
Commercial Team
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THE END