The standard used in preparing a claim should be that set by the FIDIC Contracts, which require a ‘fully detailed claim’ containing ‘detailed supporting particulars’, including good contemporaneous records, preferably signed and agreed by the Engineer or Architect.
These criteria are also implicit in other claims. A claim prepared to this standard will demonstrate to the Engineer, Architect and/or any receiving Party that the claims have substance and can pave the way for settlement of them. It will also help create an atmosphere of dispute avoidance and allow the Parties to concentrate on completing the project.
Part of the Engineer’s team of three claims advisors on US$ multi-billion coal-fired power station in South Africa, which was then the largest coal-fired station ever built and the largest project in Africa – preparation of responses to claims, Clause 3.5 determinations and Clause 2.5 Employer’s claims – contracts on FIDIC Red and Yellow Books.
John was engaged to look at the claims submitted - and likely to be submitted – to the Engineer and advise him accordingly. The three contacts which required attention were (i) the civil engineering work, (ii) the turbine contract and (iii) the boiler contract. The civils contract suffered from a lack of information from the start, including about ground conditions. The way in which the civils Contractor was handled meant that he had little idea of what was expected of him. The situation with the civil works affected both of the power train contracts. All three Contractors were threatening to refer disputes to the DABs. The task of John and his two colleagues was to try to avert that.
Preparation of claims for Japanese and Indian Contractors on projects in Kenya and Tanzania. The advice to the Japanese Contractor was on a design and build highway project in Tanzania, where the disagreement arose due to the Contractor perceiving the Engineer’s instructions as requests for ‘preferential engineering’ – the Parties came to an arrangement without the matter proceeding to a formal dispute.
John advised two Indian Contractors. One firm required advice on claims arising from an overhead cross-country electricity distribution line, which went through private ownerships, including tea and coffee plantations. This caused conflict with the affected landowners, which resulted in claims by the Contractor.
The second Indian Contractor required claims for time and money on highways and prisons. In the cases of the claims for the Indian Contractors, the claims were submitted and settled without further proceedings.
Preparation of claims for international Contractors (French, German, Greek, Caribbean and Scandinavian) on building and civil engineering projects in the Middle East, Caribbean, Europe and Far East.
The claims prepared for the French Contractor included a city water supply ring main around Kampala, a claim on a pressurised water main in a rural area of Kenya, a large diameter surface-water sewer in Tanzania and a 300m length of highway, also in Tanzania.
The claim for the German Contractor, who is an international power station constructor, was in respect of turbines supplied for power plants in Portugal and Malaysia
The claims for the Greek Contractor were on (i) a polypropylene factory in Greece and (ii) a new holiday resort in Egypt.
The claim for the Caribbean Contractor was in respect of luxury mansions built in the Turks & Caicos Islands – the case was referred to Arbitration and John was required to draft the statement of case.
The claim for the Scandinavian Contractor was for delay and additional costs arising from design problems with the piling on a diesel turbine power plant in Tanzania. Preparation of the claim required a great deal of careful engineering argument to prove the Contractor’s case. After a meeting in Dar es Salaam, the Engineer conceded that the Contractor’s case was sustainable and the matter was settled.
Preparation and negotiation of claims, and defences to counterclaims for one of the world’s largest power station constructors on gas turbine, steam turbine, combined cycle and coal-fired power plant projects in UK and Indonesia. Several projects valued from £25m to £660m.
One claim in the UK was in respect of a combined heat and power plant, including a steam turbine, at a nuclear site in the UK for both time and money and amounted to around £20m – it was settled favourably for the Contractor.
On one of the CCGT power stations in the UK, which was at the time the largest construction site in the UK, there was a potential claim against the Contractor’s designing engineer and a claim by one of the mechanical Sub-Contractors, which was settled amicably.
On the coal-fired plant in Indonesia, the claim was for an extension of time, which was granted without the need for Arbitration.
As Associate in international consultancy, preparation of claims for Contractor and Sub-Contractor in Saudi Arabia and assessment of a professional indemnity claim. The claim for the Contractor in Saudi Arabia was in respect of delays on the construction of a new holiday resort – the matter was resolved without Arbitration.
The claim for the Sub-Contractor was in respect of civil works to the intermediate pumping stations along the Saudi-Iraq pipeline – the claims were resolved without the need for Arbitration.
The professional indemnity claim was made against an insulation Sub-Contractor on a power plant in the Middle East due to the failure of his workmanship and materials. John was instructed by the Underwriters to assess the claim, which was duly done and the claim settled.
Led team of eleven QSs and Cost Engineers for a consultancy on the M&E Phase of an MoD project for the PSA. The value of the contract was approximately US$ 100m. This was a high-profile, complex project which included electrical, instrumentation, plant and equipment and mechanical packages, the last of which included HVAC and 16 piped services.
The project was badly affected by disputes between the Contractor and the Employer’s Superintending Officer – the Contractor made claims on several items of the plant and equipment, as well as the electrical, instrumentation, HVAC and consequently the building and civil works. John attended numerous negotiation meetings at the Employer’s Headquarters with Senior Officials and the Contractor’s representatives, as well as carrying out the regular duties of cost reporting, valuations and supervising the team. John also had personal responsibility for measurement and valuation of the building and civil work.
Project QS for approximately US$ 8m underground main replacement at same establishment – due to difficulty in obtaining accurate information on the existing underground services, the Contractor made claims for increases in rates, which were settled on site.
For the Contractor for whom John was working in Ghana as Senior, then Chief, QS: preparing claims on water and sewerage schemes, highways and general civil engineering works, including foundations for large industrial plants. The two water and sewerage schemes were at Kwahu Ridge, in the Eastern Region, and Tarkwa in the Western Region.
Kwahu Ridge was a difficult project, spread over a distance of about 20 miles from the intake at Lake Volta, including settlement and treatment buildings, storage tanks, booster stations and ancillary buildings, to provide clean, fresh water to the local population – the claims were for extensions of time and associated costs, due to delays in payment and in providing accurate design information – John prepared the claims and agreed them with the Danish Engineer, and obtained the Engineer’s agreement to the measurement and valuation of work executed, including adjustment of rates using the criteria contained in the measurement and valuation clauses in the FIDIC 3rd edition Contract – the relationship with the Engineer became one of trust and cordiality.
Tarkwa was considerably smaller than Kwahu, but susceptible to the same problems – nevertheless, the claims and measurement and valuation were carried out with the same relationship of trust and cordiality.
Most of the other 50 plus contracts John covered with a team of local QSs were subject to claims for delays, due to non- or late payment, late information, additional quantities of work and shortages of materials – in most cases, John was able to gain the agreement or settlement of the claims from the Architects and Engineers.
As a site-based QS for a national Contractor, this was a very early introduction to railway work, and the experience has stayed with John ever since then. The project was a Freightliner terminal in Southampton Docks, which required making a rail connection from the sidings in the terminal to the main line down from London – this and other operations, such as demolition on footbridges, could only be carried out under possessions of stretches of the line – these were often affected by the Employer’s inability to meet the time restrictions of the possessions.
There were numerous claims for time and money, for which John prepared the basic information and records. The relationship between the Contractor’s and the Engineer’s site personnel and management was fractious and had the potential to lead to Arbitration. The work sections included site investigation, piling, crane beams, permanent way, roads, pavings, drainage – every one of them was affected by late and/or insufficient information, Variations, a flood and late delivery of material such as ballast and rail-track by the Employer. John carried out the measurement of all the sections. To diminish the size of the claim, and to therefore narrow the gap between the Contractor and the Engineer, John and his Senior QS used the measurement and valuation of these sections by adjusting the Contract rates and prices to reflect the circumstances and conditions under which the work was carried out according to the measurement and valuation rules contained in the ICE 4th edition and the then applicable old version of the CESMM.
Ultimately, the measurement account was agreed satisfactorily between the Contractor’s and Engineer’s QS, with improving relations, which meant that the residual sums claimed were reduced. The Parties eventually settled and reached an agreement. This was an early example of how the objective measurement and valuation of work executed, using the mechanisms in the Contract, can avoid disputes.
