Construction Contracts - How to Manage Contracts and Control Disputes in a Volatile Industry

Front Cover......Page 1
Construction Contracts......Page 2
Copyright Page......Page 3
Table of Contents......Page 4
Preface......Page 6
1.1 Introduction......Page 8
1.2 The Fundamental Contract Document......Page 9
1.4 Lump Sum Contracting Preferred......Page 11
1.7 Reimbursable Cost Contracts Where Necessary......Page 13
1.3 Invitations to Bid......Page 10
1.9 Start Cost Reimbursable with Later Conversion to Lump Sum......Page 17
1.10 Provisional Contract Price Agreement......Page 18
1.11 Target Cost (Shared Overrun or Underrun)......Page 20
1.12 Partnering......Page 21
1.14 Professional Services Contracts......Page 23
1.16 Incentive Plans......Page 24
1.19 Field Administration of Contracts......Page 27
1.20 Planning Policies......Page 28
1.21 Integration......Page 32
1.22 Governmental Policies and Influences—The “Third Party”......Page 35
2.1 Preparation by the Client’s Team......Page 38
2.2 Errors and Omissions......Page 40
2.4 Job Explanation Meeting......Page 41
2.5 Site Visit......Page 42
2.6 Bid Package Worksheets......Page 44
3.1 Bidders’ Responses to the Invitation to Tender......Page 72
3.2 Articles of Agreement or General Terms and Conditions......Page 73
3.3 Scope of Work......Page 74
3.4 Has It Been Done Before?......Page 75
3.6 Schedule......Page 77
3.7 Compensation......Page 78
3.8 Materials......Page 79
3.10 As Built Documentation......Page 80
3.12 Subcontractors......Page 82
4.1 Reception and Examination of the Bids......Page 84
4.2 The Bid Clarification Meeting......Page 86
4.3 Low Bidding......Page 89
4.5 Unit Rates for Work Variations......Page 91
4.6 General Observations......Page 92
5.1 Client’s Procedures......Page 94
5.2 Project Coordination Procedures (A Typical Client Issue)......Page 96
5.3 Contractor’s Procedures: The Work Procedure......Page 121
6.1 The Contract Manager......Page 138
6.2 The Contract Engineer......Page 140
6.3 The Client’s Team......Page 141
6.5 Execution......Page 142
6.6 Mobilization......Page 143
6.7 The Kick-off Meeting......Page 144
6.8 Indemnity and Insurance......Page 147
6.10 Progress Reporting......Page 150
6.11 Contractor Scheduling Requirements......Page 153
6.12 The Change Order......Page 154
6.15 The Work Order......Page 159
6.16 The Amendment......Page 160
6.17 The Short Form Contract......Page 161
6.18 Completion and Acceptance......Page 162
6.20 Substantial Completion......Page 164
6.21 Standardization......Page 165
6.22 Contract Management Policy......Page 168
6.23 The Contract......Page 169
6.25 Conclusion on Model Contracts and Procedure Standardization......Page 171
6.26 Conflict of Interest......Page 172
6.27 The Diplomatic Brush-off......Page 176
7.1 Construction Claims......Page 178
7.2 A Claim by Any Other Name......Page 179
7.3 The Breeding Ground—Source of Claims before Contract Award......Page 180
7.4 After Contract Award......Page 183
7.5 Types of Construction Claims......Page 185
7.6 Claim Review......Page 189
7.7 Contractor Tenacity in Claims Promotion......Page 191
7.8 Change Order and Claims Meetings......Page 192
7.9 Contractor’s Claims Preparation and Presentation......Page 193
7.10 Claim Preparation—The Claims Consultant......Page 196
7.11 Arbitration......Page 201
7.12 Negotiation Meetings......Page 202
7.13 Computer-Aided Quantification of Delay and Disruption Costs......Page 208
8.1 Invoicing and Verification......Page 212
8.2 Work Breakdown Structure......Page 213
8.3 Measurement of Progress......Page 215
8.4 Retention......Page 216
8.6 Contract Closeout......Page 218
8.7 Contract Closeout Checklist......Page 220
8.8 Contract Closeout Report......Page 222
9.1 Vagaries in Contract Language—Claim 1 Installation of Pipelines in a Tunnel......Page 228
9.2 Contract Intent—Claim 2......Page 229
9.3 Direct and Consequential Costs—Claim 3......Page 231
9.4 Extra Work Dispute—Claim 4......Page 237
9.5 The Great Asphalt Robbery—Claim 5......Page 246
9.6 The Reimbursable Cost Offshore Bonanza—Claim 6......Page 247
9.7 The “Life” of the Contract—Claim 7 Caused by: Disagreement over Hourly Labor Rates......Page 249
9.8 Unproven Technology—Claim 8 Caused by: Lump Sum Format Without Preengineering......Page 254
10.1 The Quality Manual......Page 262
10.2 The Project Proposal......Page 263
10.4 The Construction Control Plan......Page 264
10.5 Appendix 1 Model Contract Document......Page 265
10.6 Appendix 2 Contract Amendments......Page 282
10.7 Appendix 3 Model Change Order Contract Change Order......Page 284
10.8 Appendix 4 Model Work Order Contract Work Order......Page 285
10.9 Appendix 5 Model Short Form Contract......Page 286
Glossary of Terms......Page 290
Index......Page 308