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CVE 4070

CVE 4070. Construction Engineering Contract Claims & Disputes Prof. Ralph V. Locurcio, PE. Next Week…. Next week… Tuesday - all come to room 130 Changes & Extra work HW # 5 – Change Order (due Nov 4 & 6) Study guide for Test #2 Thursday - Test #2 – room 130. Claims & disputes defined….

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CVE 4070

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  1. CVE 4070 Construction Engineering Contract Claims & Disputes Prof. Ralph V. Locurcio, PE

  2. Next Week… • Next week… • Tuesday - all come to room 130 • Changes & Extra work • HW # 5 – Change Order (due Nov 4 & 6) • Study guide for Test #2 • Thursday - Test #2 – room 130

  3. Claims & disputes defined… • A claim or dispute results when one party to a contract fails to comply with the terms of the original agreement, and the second party has suffered a material loss.

  4. Reasons for claims & disputes… • Breach of contract… • Unilateral changes... • Constructive changes…

  5. Five rules of dispute resolution… • The document must be read as a whole…each part has meaning; parts interact with each other • The document will be construed against the drafter…the author has an advantage • The document supersedes all previous discussions…the signed article is considered final; the document speaks for itself… unless it is proven to be unintelligible… then expert witnesses prevail • Specific terms govern over general terms…specific terms are precise; general terms are misleading • The document must be read in the context of the trade…accepted terms prevail

  6. Contract problems… • Protests – a notice from the contractor that he disagrees with a change order or an action taken by the owner. Must be expressed in writing by the contractor, generally within a specified time. • Claim – a formal statement of injury with a request for just compensation. Must be in writing within a specified time.

  7. Response actions by owner… • Discuss the protest or claim with the contractor. • Attempt to resolve the problem. • Respond in writing with result of owner’s review.

  8. Response actions by contractor… • Alert the owner as to potential claim • Follow procedures in contract documents • Owner must have opportunity to correct • Perform disputed work under protest • Exhaust all administrative remedies prior to litigation

  9. Claims involving time… • Compensable… when the owner fails to meet a contract obligation stated or implied in the contract. • Such as approval of shop drawings, RFI, submittals, etc. • Impact on critical path and float governs • Noncompensable… delays caused by the contractor’s actions or those which do not cause additional cost to the contractor. • Examples include poor management, late procurement, etc. • No impact to contract costs

  10. Severe weather claims… • Weather must prevent project work • Must be “abnormal” • Contractor should allow for normal or expected weather delays • Contract documents govern

  11. Acceleration of the work… • May be directed or constructive… • Compensable if owner benefits from the acceleration… and not in original contract. • Not compensable if contractor is behind schedule… and contractor has no viable plan to recover the original schedule completion date…

  12. Termination of the contract… • Convenience of the owner… i.e. project is no longer needed • Must notify contractor asap • Compensate contractor for all reasonable costs & materials • Termination for cause… i.e. contractor’s repeated failure to follow contract provisions • Must have adequate proof and documentation • Very rare • No compensation to contractor

  13. Resolving differences… Order of preferred resolution: • Negotiation… like a change order • Dispute Resolution Board…provided in most standard contract provisions; involved outside panel of experts • Alternate disputes procedures… use of facilitator, mediator, mock court, or any non-legal method • Arbitration… binding or non-binding; requires signed agreement on procedures • Litigation… most time consuming; most expensive; court proceeding in special contracts court

  14. Cost Estimate Solution • Grade your own work • Be sure your name is on the paper

  15. HW#4 Dormitory Estimate

  16. Dormitory Estimate-1

  17. HW#4-Warehouse Estimate

  18. Warehouse Estimate-2

  19. Don’t forget… • Next week… • Tuesday - all come to room 130 • Changes & Extra work • HW # 5 – Change Order (due Nov 4 & 6) • Study guide for Test #2 • Thursday - Test #2 – room 130

  20. Babcock Street Concept - 1

  21. Babcock Street Concept -2

  22. Babcock Street Concept - 1

  23. Babcock Street Concept -2

  24. Using $150/SF…

  25. Using $138/SF

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