DELAY AND DISRUPTION CLAIMS
Holloway Consulting is a Construction Consulting firm with offices in Colorado and Louisiana. As illustrated on our post at Construction Claims, one of Holloway Consulting’s primary practice areas as Construction Claims Experts is in matters involving causation, delay, and damages.
This post continues our series on the services we provide to our clients as Construction Claims Experts, in this case, on Delay and Disruption Claims, sometimes referred to as Cumulative Impact Claims.
STRUCTURAL STEEL CLAIMS
This litigation was between the plaintiff structural steel supplier and steel erection companies, the Owner and its agents – the Architect, Structural Engineer, and General Contractor – on a $50 million condominium project at a destination resort in northern California. Various causal factors beyond the Steel Contractors’ control prevented the steel work from being completed in a timely and cost efficient manner, and caused the completion dates for the structural steel work to become severely extended. The delays and impacts to the structural steel work was the result of primary causal factors such as:
1. Scope Growth;
2. Deficient Contract Documents;
3. Delayed Building Releases; and
4. General Contractor Mismanagement.
As a result of these and other compensable causes, the steel supplier and its steel erection subcontractor incurred substantial additional costs. Holloway Consulting was retained by both the steel supplier and steel erector to prepare a claim document and allocate responsibility for the extra costs between the various responsible parties.
CHANGE CLAIMS
Such change claims are described as either a Delay and Disruption Claims or Cumulative Impact Claims, which have been defined as claims where multiple changes on a project act in sequence or concurrently to increase project costs, disrupt work sequences and extend the schedule. Disruption and impact occurs when project conditions deteriorate, as they did here, to the point where work on certain activities is adversely affected by changes, additions or work on one or more other activities. In short, both changed and unchanged work was affected.
As is often the case on troubled projects of this nature, change-related events on this project had a negative and synergistic effect on both changed and unchanged work. The compounding effect of the numerous compensable causal events was:
1. Inadequately understood;
2. Difficult to precisely quantify; and
3. Seldom, if ever, reflected in the estimated cost of approved and pending project changes.
CRITICAL CLAIM ELEMENTS
The investigations performed by Holloway Consulting working as the contractors’ Construction Claims Experts revealed that the circumstances on this project satisfied the two critical elements of such Delay and Disruption Claims, in that the change-related events were both:
1. Extensive; and
2. Unforeseeable.
CLAIM RESOLUTION
This case settled in mediation. The steel supplier and steel erector’s construction damages were prepared using the Modified Total Cost Method, which is essentially the Total Cost Method adjusted or modified to account for non-claimable causes. This methodology is commonly employed by experts in Delay and Disruption Claims, and is accepted in all legal forums. The construction contractor’s primary entitlement in this dispute was “schedule delay”. As was the case here, such delay claims are typically analyzed and quantified by experts such as Holloway Consulting via Critical Path Method (“CPM”) scheduling techniques, based on the general contractor’s schedules and updates.
Read other posts on our Construction Expert Witness cases.
Holloway Consulting
Construction Claims Experts and Witnesses
12081 W. Alameda Pkwy., #450
Lakewood, CO 80228-2701
Denver Phone: (303) 984-1941
International Toll Free: (888) 545-0666
Fax: (303) 716-0432
Email: steve.holloway@disputesinconstruction.com
Blog: disputesinconstruction.com
Web: hcgexperts.com
