Case Studies > Urban Railway System

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An urban railway system inclusive various systems such as the rolling stock, trackwork, switches, contact rail, traction power and power distribution, operations and control systems, in addition to building and civils installations such as the guideway and platforms, stations, parking, tunnels, equipment rooms, maintenance and storage facilities as well as a central control room and administrative offices. The contract was awarded by a government agency (the Employer) to a number of main contractors of which our client was one (the Contractor).

KEY FEATURES

A fixed price, lump sum, turnkey contract let under the Employer's hybrid form of design and build contract with the Employer and the Contractor as the only parties to the contract, there being no administrative agent or "Engineer" as found under several well recognized international standard forms of contract.

The contract involved complex contractual interfaces with eight other main contractors coordinated overall by the government agency in addition to numerous technical interfaces with several key subcontractors across a broad series of buildings, civil works and hi tech systems installations. A high level of overall project coordination and control was requird to uphold the time and cost constraints under the terms of the contract.

Due to numerous causal events of disruption, delay, additional cost and expense, during the design, procurement and construction phases of the project, as well as due to contract variation orders, both the contract time for completion and the original contract price were considerably exceeded. The government authority had previously awarded several contract variation orders, extensions of time and monetary claims for additional costs, loss and expense during the first few years of the contract period. Moreover, an additional agreement document had been drawn up, formalized to record all the approved and agreed changes and the conditions under which the works affected by the changes were to be executed.

Our clients were of the opinion that further contractual entitlements to both extensions of time and financial reimbursement had arisen out of ongoing disruptions, critical delays, contract prolongation and other events causing loss and expense occasioned by the Employer and/or other contractors. In addition to such claims, our client also considered proposals for acceleration measures to the "works to complete" as being in the best commercial interest of the Employer.

CONSULTANCY SERVICES

Lancaster House International Consulting were requested to mobilize rapidly to our client's project offices, initially review the key contract documentation together with preliminary contractual claim submissions and commercial proposals for a re-sequenced and accelerated completion of the remaining works. Our client's staff had prepared their drafts in conjunction with a firm of American construction lawyers. Our commission included determining what breaches of contract had occurred, causing both time and cost overruns and identifying which party(ies) was/were responsible; providing advice on where there may be opportunities for improving the likelihood of the submissions being readily appreciated by the Employer and the appropriate level of compensation being awarded. It was imperative that the submissions were prepared and handled in a manner that would not cause a deterioration of project relationships and lead the parties into dispute. We worked closely with our clients and their lawyers in obtaining a factual background and, setting this information against the provisions of the contract documentation, we were able to make clear recommendations for improvements in the format and content of the claims and commercial proposals to meet the terms of our brief. Our conclusions were submitted under an executive summary report for consideration by our client's senior managment and the lawyers and thereupon actions were taken accordingly. Our involvement produced a substantially positive outcome.