This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Our target is to tie your technical challenges to your financial success
3
Who are we?
TK Consulting is an independent and international consulting company specialized in the contract and claim
management of construction projects in European countries (Poland, Hungary, France, Serbia, Romania, Russia,
Slovakia, …)
TK Consulting was founded by 2 civil law engineers Frank Thomas and Stanislaw Koziarski in 2007 well experienced
with providing contract and claim management services
TK Consulting employs multi-cultural construction engineers and senior partners all well experienced in the project,
contract and claim management of construction projects locally and internationally.
TK Consulting’s commitments
o Harmonization of technical and financial challenges
o Consolidated knowledge in contract and claim management through “in house” project synergies
o Supports real time preparation and negotiation of claims by implementing appropriate delay analysis and quantum
evaluation techniques
o Used to exhaust the entire contractual and legal process
o Used to employ recognized delay analysis and quantum evaluation techniques
Our company networking in European countries and our well-structured project database enables us to be
internationally and locally efficient
4
5
What do we do for your Project?
Anticipation
o Project due diligence in order to ensure that risks have been properly evaluated, allocated and understood by
the Parties
o Improvement and validation of the Project programme baseline for progress monitoring and delay analysis
purpose
o Ensure that time and cost overrun is under control at the Project outset
Execution support
o To ensure that contract management procedures are in place during the Project life time
o CPM schedules preparation/support and programme analysis
o Contract and claim management in real time by allocating a team of experts to your project
o Drafting key contractual correspondence
o Claims and Variations preparation by using appropriate quantum techniques
Negotiation support
o Claim Requests/Defense/Expert Reports
o Quantum/Damages Analysis
o Compounded Impact Claims
o Better visualization of claim through graphics and multimedia presentations
6
Adjudication/Arbitration/Litigation
o Preparation of Parties position papers and hearings for Adjudication/Arbitration/Litigation proceedings
o Forensic Delay Analysis and quantum expertise by establishing cause and effect by using recognized CPM
analysis techniques
7
The market trend in CEE countries: 3 examples
TK consulting has been preparing and defending numerous Contractor’s/Employer’s claims through direct
negotiation, adjudication and arbitration
o Example No1: Bridge Project under FIDIC yellow book 1999 edition contract
o Example No 2: Subway Project under FIDIC yellow book 1999 edition contract
o Example No 3: Motorway Project under FIDIC red book 1999 edition contract
8
Example No 1: FIDIC yellow book 1999 edition contract
Bridge project over a river:
o Original Contract Price 33 Mio. EUR
o Original duration: 24 months
o Actual duration: 60 months (36 months’ time extension)
o Total amount of Claims and Variations prepared by TK consulting: 90 Mio. EUR
o Amount of Claim and Variations accepted by the Employer: 34 Mio. EUR
o Amount to be recovered through further litigation (adjudication and arbitration): 56 Mio. EUR
o Adjudication confirmed 40 Mio. EUR plus interest out of 56 Mio. EUR. Employer however refused to pay.
o Arbitration under preparation
9
Example No 2: FIDIC yellow book 1999 edition contract
Subway project (FIDIC type contract):
o Original Contract Price: 200 Mio. EUR
o Original duration: 33 months
o Actual duration: 62 months (29 months’ time extension)
o Total amount of Claims and Variations prepared by TK consulting: 80 Mio. EUR
o Amount of Claim and Variations accepted by the Employer: 20 Mio. EUR
o Amount to be recovered through further adjudication and arbitration: 60 Mio. EUR
o Adjudication was local and brought no result for the Contractor
o Arbitration ongoing. TK consulting was also entrusted with the preparation of the Forensic Delay Analysis documentation.
Example No 3: FIDIC red book 1999 edition contract
Motorway project 54 km (FIDIC type contract):
o Original Contract Price: 117 Mio. EUR
o Original duration: 24 months
o Actual duration: 36 months (12 months time extension)
o Total amount of Claims and Variations prepared by TK consulting: 70 Mio. EUR
o Amount of Claim and Variations accepted by the Employer: 53 Mio. EUR
o No litigation required
10
Employer’s line of defense observed during adjudication/arbitration/litigation under FIDIC Contracts
Defense No 1: Adopt the “wait and see” approach
Defense No 2: Employers are also used to submit claims in order to reduce Contractor’s entitlement
Not complying with a “binding but not final” DAB decision
Using the time bar sub-clause in order to “demolish” Contractor’s claims
Limiting Engineer’s determination power in respect of claims and variations
Not consulting the Contractor prior issuing Engineer’s determination
Using day work rates or breaking Price Centers under lump sum contract for pricing Variations
Rejection of the Hudson/Edem formulae for pricing unabsorbed head office overheads
Rejection of the "impacted as planned” method for evaluating time extension claim retrospectively
Misusing the grey zones in the Contract about ownership of float
Requesting the Contractor to demonstrate its EoT entitlement on the basic of its original baseline programme
Referring to US and UK literature for undermining Contractor’s quantum methodology such as:
o Society of Construction Law Delay and Disruption Protocol printed in October 2002
o FIDIC Guide for practitioners (Dr Hoek and Mr Jaeger)
o Delay Analysis in Construction Contracts (P. J. Keane & A. F. Caletka)
o Construction delays – Understanding them clearly, analyzing them correctly (T.Trauner)
o Evaluating contract claims (R. Davison, J. Mullen)
11
Typical Contractor’s project management mistakes under FIDIC Contracts:
Consider contract and claim management services as “hostile” and contra-productive in his relation with Employer
No proper Tender programme
Preparation of “static” baseline programme for the purpose of reaching Engineer’s satisfaction (only)
Most of Contractor’s baseline programmes are unfit for the purpose of time extension quantification
No proper warning system about the tracking and reporting of claim event in real time
No proper “ready to use” cost data base for pricing variations and claims
Fear to report on contractual matters to supervisory board in real time
Simplistic Cash Call strategy (Build until project cash has been exhausted and ask for more cash when you need it)
No proper “as built” programme record
…
12
Integrate TK Consulting contract and claim management services in your project organization
TK Senior Contract Manager/Partner
TK programme expert
(scheduler/delay analyst)
TK Contract Manager on Site + TK office assistant
TK Claim manager on Site
o Depending from the actual need on Site and after due consultation with your project team, the size and scope of the contract/claim management team will be adjusted to your project requirements.
o Regular training of Site staff on contractual Parties’ obligations
o Preparation of the key contractual correspondence in compliance with contract terms
o Preparation of a “real time” change event tracking system
o Preparation of “dynamic” baseline programme, subsequent update and “as built” programme
o Preparation of Change Orders and claim documentation
o Negotiation of claim and variations with the Engineer/Employer
o Participation to monthly and weekly construction meeting (“contract and claim management team integration”)
o Monitoring and reporting regularly on the status of Change Orders and claim documentation
o Developing and maintaining a sound archiving system for all claims and variations
o Preparation of “back to back” subcontract head of terms
o Using convincing visualization techniques for demonstrating Project changes during claim negotiation
o Preparation of Contractor’s position papers for adjudication in accordance with international practice
o Preparation of prospective/retrospective forensic delay analysis
13
Typical TK Consulting services in contract and claim management:
o TK Consulting provides regular internal and external training:
14
o TK Consulting prepares and monitors the entire key contractual correspondence per claim event:
Overview of the correspondence exchanged between Contractor and Engineer/Emp[loyer in respect of
the implementation and evaluation of Variation No XX
15
o TK Consulting prepares the “dynamic” baseline programme, update and as built programme fit for the purpose of prospective
and retrospective delay analysis
Track and update the critical path by injecting Employer’s Delays in real time (prospective delay analysis)
16
o TK consulting archives all relevant correspondence and claim documentation:
Collect and concentrate all the relevant claim documentation in one place
17
o TK consulting is able to track “measured miles” and to prepare loss of efficiency claims
Need to monitor and record activities of workers each month