Case Study: A Successful Outcome for Quantity Surveying Projects
Recently, PEP Solutions was contacted by a distressed developer who had engaged a contractor to deliver the civil infrastructure and roadworks for 60 townhouses. At the time of our appointment, the contractor had ceased work and issued a claim for the complete scope of the work plus variations.
PEP Solutions Quantity Surveyors set about reviewing the contract and scope of works, payments previously made by the developer and variations claimed as additional work and any purported costs of time extensions. Unfortunately, the signed agreement had nominated a Contractor associated entity as the Contract Superintendent and the Project Manager, with no security held on behalf of the Client. Needless to say, the contract conditions also heavily skewed in favour of the Contractor.
PEP Solutions was subsequently installed as the new Superintendent to allow a review and assessment of the real situation and to provide the level of independence which should have been in place from the outset. Our Quantity Surveying team then established a project estimate to analyse and check the contract price and payments against original allowances.
We ascertained that payments for completed works had been overpaid by 37% and identified that no contract administration/documentation had been recorded by the original Superintendent or Project Manager.
Additional claims amounting to 30% of the contract sum were reviewed and ultimately rejected and quality issues with the completed work still had to be addressed.
The contracting arrangement was a disaster in the making for the Client (and project) and the most beneficial approach would have been:
· Obtain an estimate/budget from a Quantity Surveyor who can consider ALL costs before proceeding
· Obtain independent advice on the contract and conditions prior to tender/engaging a contractor
· Consider a competitive process to procure the correct contractor for the work
· Engage an experienced professional to assist in contract negotiations
· Engage a competent independent professional to administer your contract and costs
· Establish strict protocols around the delivery and program for the works
By employing the approach above, the project will be established on the best foundation and can be more easily managed to achieve best results.
In this case, we were able to assist in the various processes of recovering some of the situation, but the project had already suffered due to delays and overpayments which were difficult to reverse.
Earliest engagement with a “partner consultancy” such as PEP Solutions will lead to higher returns and maximum benefit to the project.