Charlotte's Questions Flashcards
When developing a cost estimate / plan, what rules would you refer to?
New Rules of Measurement 1
Can you please summarise what the RIBA Plan of Works looks to achieve and at what stages you would expect to undertake a cost estimate / cost plan?
The RIBA Plan of Work organises the process of briefing, designing, constructing and operating building projects into eight stages and explains the stage outcomes, core tasks and information exchanges required at each stage.
Stage 0 - Initial/rough order of cost estimate
Stage 1 - order of cost estimate
Stage 2 - formal cost plan 1
Stage 3. - formal cost plan 2
Stage 4 - For al cost plan 3 / Pre-tender estimate
You mention utilising difference cost information sources, can you please advise what ones you are aware of and how you would look to adjust this information to ensure it is applicable to your project?
I am aware of our in-house Market Rates and Benchmarking apps, BCIS and Spons. I would adjust these according to time and location but also take account any abnormals.
In your submission you state that for the Portland park project you used ‘benchmark data’ what do you mean by this? What might you need to do to benchmark information to make it relevant?
Once the cost plan had been completed we were able to calculate a cost per m2. I was then able to find similar projects using our benchmarking app from past projects, adjust their rates in terms of time and location, and check they were comparable.
When looking at project preliminaries as part of cost planning, what considerations would you need to make to allow you to best estimate these?
I would establish the estimated value of the construction works and the length of the construction programme.
Consider the site location and constraints as well as value and length of programme, also nature of the works.
I would then look at similar sized projects to establish what their weekly prelims amount was then apply that rate to the total amount of weeks of the construction programme.
In Portland park project you mention applying tender and construction inflation – can you explain why these inflation costs are separate?
Tender Inflation
An allowance included in the order of cost estimate or cost plan for
fluctuations in the basic prices of labour, plant and equipment, and
materials during the period from the estimate base date to the date
of tender return.
Construction inflation
An allowance included in the order of cost estimate or cost plan for
fluctuations in the basic prices of labour, plant and equipment, and
materials during the period from the date of tender return to the
mid-point of the construction period.
You mention including assumptions and exclusions, please provide an example of some typical assumptions and exclusions you would contain within a cost estimate?
Assumptions:
1. Priced on current market conditions. Any allowance for price fluctuations is included in the tender and construction inflation allowance.
2. No unforeseen ground conditions, contamination (material on site is inert) or archaeological findings.
3. Assumed normal weather patterns (nothing extreme)
Exclusions:
1. Unforeseen ground conditions - costs for removing contaminated soil, archaeological finds or rock are not included
2. Land acquisition costs
3. Client supplied items
4. Out of hours working
5. Force Majeure events (pandemics or natural disasters)
6. Changes to the scope
Given the current market how would you capture inflation within a cost plan?
I would include for tender and construction inflation. At the time of the stage 3 cost plans this was…
You reference that you are in receipt of Turner & Townsend’s UK Market Intelligence Reports and that you include a section on market conditions within your reports to Clients – what does the latest market report tell us about the market conditions? In particular about OH&P for Tier 1 contractors?
It tells us that the market in the north east is buoyant at present and there are a lot of projects available to tender for. Due to this, the tier 1 contractors can now pick and choose which jobs they wish to tender for.
With regards to procurement methods, combining the competitive environment and the high costs of tendering, this is now a cost risk contractors aren’t willing to take and has resulted in the low appetite for single stage tendering.
It has also been noted that due to inflation and the competitiveness nature of the north east market, OH&P rates are more likely to nearer 6% than those of 2-3% in recent years.
On Portland park you mention that some of the VE examples came with Health and Safety concerns – what were these? Is it your place to advise on Health and Safety viability?
Some of the options that arose were replacing a ramp for steps, and removing handrails at the top of other steps on the site. While it wasn’t my place to advise on health and safety matters as such, it is part of my role to comply with any relevant legislation, and in connection with Part M of the Building regulations, removing them would potentially be in breach of the Disability Discrimination Act and shouldn’t be considered just to save money.
As you will be aware there has been some recent changes to JCT with the release of JCT D&B 2024 form of contract, are you able to outline two changes to the suite?
One change is that 2024’s has been modernised. Notices can now be served electronically via email to stipulated addresses (other than termination payments) which reflecting modern communication practices, and the contract now adopts gender-neutral language throughout.
With regards to Extension of Time and Delay Provisions, The Employer must respond to extension of time claims within 8 weeks, reduced from 12 weeks, and must request any additional information within 14 days (there was no such limit under D&B 2016).
Also new Relevant Events have been introduced, including epidemics affecting labour, services, or materials, and changes in law or guidance impacting the works.
Others as back-up…
The 2024 contract mandates that parties work in a co-operative and collaborative manner, in good faith and in the spirit of trust and respect. This was previously an optional supplemental provision in the 2016 edition and is now a default requirement.
With regards to Building Safety Act Compliance. the contract appoints the Contractor as both the Building Regulations Principal Designer and Principal Contractor, aligning with the duty holder regime introduced by the Building Safety Act 2022. However, JCT does not recommend using this contract for Higher-Risk Buildings. (I know I’ll get asked about this elsewhere so best be on top of it!)
You note within your submission that you have experience of bespoke contracts – what are the pros and cons of bespoke forms?
What project did you use bespoke on?
Pros:
* Commercial advantage - if drafted well it can provide a competitive advantage by clarifying obligations, reducing disputes and streamlining processes
* Risk allocation - enables more precise allocation of risks based on project specifics instead of a one-size-fits-all approach
* Flexibility - parties have full contractual over the contract terms, allowing them to include clauses that standard forms might not cover
Cons:
* Time-consuming - drafting this kind of contract requires a lot of effort and negotiations and legal input which could potentially delay the project commencement
* This also comes with higher cost in terms of legal fees.
* There is also the lack of familiarity. Standard forms are ‘tried and tested’ so attempting to resolve any disputes could prove harder with no previous knowledge of using this particular contract.
Used this on some JV housing developments int eh north east.
You state on Mandela building that you collated the contract documents – what are the key sections of contract documents?
○ Contract
○ Schedule of Amendments
○ Preliminaries and General Conditions
○ Employer Requirements
○ Contractors Proposals
○ Pricing documents
○ Warranties
○ Novation agreements
What information may you need from the Client to complete the contract documents?
○ Client’s Full Legal Name and Contact Information
○ Project Scope and Details
○ Timeline and Deadlines
○ Schedule of Amendments via their solicitor
○ Signatures
You note on Mandela building refurb that the legal team agreed contract amendments – can you give me an example of an amendment made to the standard form?
○ Payment terms have been increased from 14 days to 30 days from due date
○ Pay less notice reduced from 5 days to 3 days
On this project you state you were EA and QS and that you were responsible for issuing the payment certificates within the contractually stipulated timescales – what were these?
Interim Valuation Dates (IVD) are agreed in the contract particulars and occur monthly.
The due date for interim payment is 7 days after the IVD and the Contractor must submit an interim application for payment by the IVD.
Payment Notice issued within 5 days from Due Date
Final Date for Payment is 14 days from Due Date
Pay less notice should be issued no later than 5 days prior to Final Date for Payment (this must be issued by the client, example of reason is defective work)
Under JCT D&B Can you give me 2 examples of a relevant event?
○ Work carried out by statutory undertakers
○ Variations
(Others include force majeure, instructions, Deferment of possession of site by Client, Discrepancies in ERs)
What is the difference between a Relevant Event and a Relevant Matter? What are the differences between the two?
A Relevant Event is an occurrence that causes a delay to the completion date of the project and the Contractor may be entitled to claim an Extension of Time.
A Relevant Matter is an event for which the client is responsible and will affect the progress of the works and where the Contractor can claim for loss and expense.
So for example if the Contractor was delayed onsite as a result of statutory undertakers would they be entitled to Loss and Expense?
No, but they could be entitled to an extension of time as statutory undertakers would fall under a Relevant Event.
Say you undertook an assessment and the Contractor was due Loss and Expense and an EOT, the Contractor then claims for the Loss and Expense within his monthly valuation – does the Loss and Expense attract retention?
No, the Loss and Expenses element would not.
So as on many projects there is a likelihood that the delays experienced are concurrent. Does JCT D&B 2016 reference concurrent delay? How would you go about assessing this?
JCT D&B 2016 does not explicitly reference “concurrent delay” within its standard form, so they would have to be addressed via Extensions of Time and Loss and Expense provisions.
To asses them I would:
Determine which delays are concurrent by analysing the contract programme and identifying the overlapping delays.
I would then establish which party was responsible to each delay .
I would then assess what their impacts would be on the critical path, so only those delays affecting the critical path would affect the completion date.
So under JCT D&B, If the Client came to you and stated that they had a specific landscape sub-contractor that they use on their wider portfolio and they want to include this sub-contractor within this contract, what would your advice to the Client be? Is there provision to do this?
I would tell the Client that there was a provision in the contract to do this and this would be by adding the contractor as a Named Sub-Contractor in the contractor.
I would however advise that they would be responsible for this subcontractor, so the client would ultimately be taking the risk if there were any issues, either in terms of their work quality or their financial stability.
If you were to see this through to Practical Completion, under a JCT D&B contract can you please summarise what issuing of the Practical Completion certificate triggers
○ Release 50% retention
○ Insurance transfers to the client
○ Defects liability period begins
○ Employers no longer has the ability to levy LADs
○ Settlement of FA
Are there any other options available other than issuing full Practical Completion under a JCT contract?
○ Partial possession certificate
○ Certificate of non-completion
Keeping with JCT D&B 2016, who’s responsibility is it to issue a Pay Less notice and can you give me an example of when a Pay Less Notice might be issued?
It would be the responsibility of the client. An example could be if items of work that were installed were later found to be defective or didn’t comply with building regulations.
When can an employer claim for liquidated damages?
When the contractor has failed to complete the works by the agreed completion date set out in the contract programme and a certificate of non-completion has been issued.
What are the grounds for termination from the client under JCT D&B?
If the contractor:
○ fails to proceed regularly and diligently with the works
○ suspends the carrying out of the works without reasonable cause
○ fails to comply with an instruction from the employer or the employer’s representative
○ becomes insolvent
○ commits a material breach of contract
What is the procedure for termination?
Notice of Default: The employer must issue a notice specifying the default and requiring the contractor to remedy it within a specified period (usually 14 days) (Clause 8.4.2)
Termination Notice: If the contractor fails to remedy the default within the specified period, the employer can issue a termination notice, effectively ending the contractor’s employment under the contract (Clause 8.4.3)
