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ABSTRACT
One of the main characteristics of construction projects in general is that they
are subject to a wide range of risks causing delays beyond the planned completion
dates. Due to the current unrest in the Middle East and North Africa, it is expected
that the World Bank will fund many projects in the region to restore and build the
affected and aged infrastructure systems. Under the current circumstances, these
projects could be subject to delays. World Bank projects are managed through the
Standard Bidding Documents for Procurement of Works (SBDW). The Conditions of
Contract included in the SBDW (i.e. WB Contract) are based extensively on the
Conditions of Contract for Construction published by the International Federation of
Consulting Engineers (FIDIC). Since the WB Contract and the FIDIC have their own
procedures that cover the submission of schedules (programmes, the term used in the
WB Contract and the FIDIC), updating programmes and submission of claims for
extension of time; some delay analysis techniques would fit to be applied to such
contracts whereas other would not. Under these interrelated conditions, it is crucial
for U.S contractors to utilize the appropriate delay analysis techniques that will
enable them to study and assess the associated impact to the project schedules, and
consequently submit well substantiated claims for extension of time. This paper uses
a three-step methodology to present administration guidelines for appropriately
applying the different delay analysis techniques to the World Bank funded projects.
INTRODUCTION
Delay is generally acknowledged as the most common, costly, complex and
risky problem encountered in construction projects (Ahmed et al 2002). According to
contractual frameworks, construction delays can be grouped in four broad categories:
(1) non-excusable delays are ones that the contractor either causes or assumes their
risks, and thus is not relieved of their consequences; (2) non-compensable excusable
delays are caused by factors that are not foreseeable, beyond the contractors
reasonable control, not attributable to the contractors fault or negligence, and thus
while the Contractor will not receive compensation for the cost of delay, he will be
entitled for an additional time to complete his work and is relieved from any
contractually imposed liquidated damages for the period of delay (3) compensable
excusable delays include suspensions and/or interruptions to all or part of the work
caused by an act or failure to act by the owner resulting from non compliance and/or
breach of an obligation, stated or implied, in the contract, and thus the contractor is
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entitled not only to an extension of time but also to an adjustment for any increase in
costs caused by the delay; and (4) concurrent delays that occur when both owner and
the contractor are responsible for the delay (Ahmed et al. 2002; Menesi 2007).
GOAL AND OBJECTIVES
This paper presents contract administration guidelines for appropriately
applying the different delay analysis techniques to the World Bank funded projects.
The objective is to promote efficient and effective management of claims for
extension of time under the World Bank contracts, and consequently highperformance project outcomes. Ultimately, the World Bank will be more enabled and
aligned to attain its mission and objectives because neither the Bank nor its associated
stakeholders will suffer from lengthy problems during the course of their projects.
BACKGROUND INFORMATION
In early 2011, uprisings in Tunisia and Egypt led to the overthrow of their
heads of state and sparked a wave of protests throughout other countries in the Middle
East and North Africa. These moves, now commonly referred to as the "Arab
Spring", will trigger the World Bank to fund major projects in the region in order to
restore and improve the affected and aged infrastructure systems, respectively. The
World Bank was created at the Bretton Woods Conference, USA, in 1944. It was
established to carry out the reconstruction works in Europe after World War II. Later,
its mission was changed to reduce poverty through funding various infrastructure
projects in developing countriesIn May 2005, the World Bank prepared the Standard
Bidding Documents for Procurement of Works (SBDW) in projects funded in whole
or in part by the World Bank. The SBDW are based on the Master Bidding
Documents for Procurement of Works and Users Guide adopted by the Multilateral
Development Banks (MDBs) and International Financing Institutions. The Conditions
of Contract included in the SBDW are based extensively on the Conditions of
Contract for Construction published by the FIDIC in 1999. In this paper, the General
Conditions included in the SBDW are referred to as WB Contract.
RESEARCH METHODOLOGY
This research used a three-step interdependent research methodology where
the authors: (1) conducted a comparative analysis of the different delay analysis
techniques; (2) studied and presented the application of each technique to the WB
Contract; and consequently (3) recommended contract administration guidelines for
the use of the different techniques as appropriate under the WB Contract.
DELAY ANALYSIS TECHNIQUES
There are many techniques for delay analysis. Delay analysis is used to
determine the cause(s) of the delay in order to ascertain whether an extension of time
should be awarded. The analysis of delays in construction projects is difficult and
complicated because of the large number of individual activities that have to be dealt
with, even for a relatively simple project (Menesi 2007). The purpose of the delay
analysis is to calculate the contribution of each party to the total project delay. Daily
recording of progress-related data including start and finish times, work completed,
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resources used, idle times, work disruption periods, delivery of materials, and change
orders, are of extreme important for effective and efficient delay analysis. This paper
focuses on the following three most commonly used delay analysis techniques.
Impacted As-Planned
In this technique, the as-planned schedule is identified and used as a basis.
The delays caused by either the contractor or the employer are identified and inserted
into the as-planned schedule. The result would be the as-planned impacted schedule
with a new date for completion. The difference between the as-planned completion
date and the new completion date is determined to be the impact of the inserted
delays on the project duration (Magdy 2010 and Stumpf 2000). In such case,
contractors who submit a claim for extension of time would insert only the employer
responsible delays and the resultant impact on the project duration shall represent the
extension of time entitlement, as a result of such delays. It could be used as a
prospective technique, i.e. by identifying the likely impact of certain delay events on
the project duration. It could also be used as a retrospective technique, i.e. by
identifying the actual impact of some events upon completion, after the fact.
Collapsed As-Built (or But-for Analysis)
It is the reverse of the Impacted As-Planned analysis. In this technique, the asbuilt schedule is used as a basis. The analyst studies the as-built information and
constructs an as-built schedule. The analyst then removes the activities representing
the employers delays or shortens the actual durations of delayed activities. This is
used by the contractors to demonstrate a schedule that could have achieved 'but for'
the actions of the employer. The result would be the collapsed as-built schedule
with a new date for completion. The difference between the as-built completion date
and the collapsed as-built completion date is determined to be the extension of time
entitlement as a result of the employer responsible delays (Trauner et al. 2009;
Menesi 2007). This is a retrospective technique.
Windows/Snapshot/Time Slice/Contemporaneous Period Analysis
In this technique, the total duration of the project is divided into a number of
time periods or windows or snapshots, usually monthly. The project is updated at
the end of each window (usually represents the regular updates of the as-planned
schedule). From each window, two things are determined; the critical path at that
date and the extent of delay incurred to completion as at that date (Barry 2009). The
delays are then analyzed within that window to determine the ones for which the
contractor is responsible and the ones for which the employer is responsible. This is
repeated for all windows. It could be used as a prospective or a retrospective
technique.
ADMINISTERING DELAYS UNDER WB AND FIDIC CONTRACTS
Programme
According to Sub-Clause 8.3 of the WB Contract and the FIDIC
[Programme], the Contractor is required to submit to the Engineer within 28 days
after receiving the notice under Sub-Clause 8.1 [Commencement of Works] a detailed
programme (i.e. schedule). However, the Engineer is not empowered to give or
withhold approval to the programme. The programme is submitted to the Engineer
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only for his consent, i.e. the Engineer shows that he has no objection to the
Contractor's programme but assumes no responsibility for it (Bunni 2005). As a
result, neither party can misuse the programme in order to achieve an unfair
advantage over the other party. Since no approval is required, the Engineer cannot
wrongfully withhold approval unless and until the programme includes a constraint
which was not provided for in the Contract. Furthermore, if the Contractor submits an
over-optimistic programme, there will be no approved programme to be used in the
validation of a claim for extension of time. In such case, it would not be reasonable
for obligations to be imposed on the Employer by reason of a document prepared
after the Contract became effective and to which no consent was required to be given
and no consent was given (Booen 2000). The above applies to both the WB Contract
and the FIDIC.
The same Sub-Clause requires the Contractor to notify the Employer of future
events which may delay the execution of the Works. In addition, the Contractor is
required to submit a revised programme whenever the previous programme is
inconsistent with actual progress or with the Contractor's obligations under the
Contract. On the other hand, if the Engineer notifies the Contractor that the
programme fails to comply with actual progress and the Contractor's stated intentions,
the Contractor is under the obligation to submit a revised programme to the Engineer.
It should be noted that it is the actual time which is referred to as being affected, not
the Time for Completion to which the Contractor is entitled, so the obligation of the
Contractor to notify includes events other than those which entitle the Contractor to
extension of time, i.e. it includes events for which the Contractor is responsible
(Booen 2000). It should also be noted that, under Sub-Clause 4.21 [Progress Reports],
the Contractor is required to include in his monthly progress reports a comparison of
actual and planned progress, with details of any events or circumstances which may
jeopardize the completion in accordance with the Contract, and the mitigation
measures adopted to overcome delays.
Studying Construction Delays
The delay events which could possibly raise entitlement to extension of time,
under the WB Contract are listed in Sub-Clause 8.4, as follows:
a) a Variation (unless an adjustment to the Time for Completion has been agreed
under Sub-Clause 13.3 [Variation Procedure]) or other substantial change in the
quantity of an item of work included in the Contract,
b) a cause of delay giving an entitlement to extension of time under a Sub-Clause of
these Conditions,
c) exceptionally adverse climatic conditions,
d) Unforeseeable shortages in the availability of personnel or Goods caused by
epidemic or governmental actions, or
e) any delay, impediment or prevention caused by or attributable to the Employer,
the Employer's Personnel, or the Employer's other contractors.
Sub-paragraph (b) in the above Sub-Clause states as one of the delay events
a cause of delay giving an entitlement to extension of time under a Sub-Clause of
these Conditions. Bunni (2005) lists the following sub-clauses as relating to
extension of time in FIDIC, which are referred to in sub-paragraph (b). The authors
contend that the same would apply to the WB Contract (Fawzy and El-adaway 2011):
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Figure 2: Extension of Time for Events having a Continuing Effect under the
WB Contract and FIDIC
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The Impacted As-Planned technique should yield reliable results under the
WB Contract and FIDIC if the delays occurred at the outset of the project and the
analysis is performed before the timescales provided for in the contracts expire. Yet,
if later on further delays occur and the Contractor attempted to insert the delays into
the as-planned programme, the Engineer should only accept the inserted delays for
which the timescales for the notification was met by the Contractor. If other delays
not notified by the Contractor had occurred and hence were not included in the
analysis, the programme would be one that does not take account of the relevant asbuilt information. Thus, the programme would not necessarily reflect the actual
progress of the works and the technique would unlikely yield reliable results.
Notwithstanding the above, still this technique lacks fairness and accuracy as
the Contractor would be including only the Employer responsible delays.
Furthermore, this technique does not assure that the delay to completion was a result
of the inserted delay events and thus the causation factor which is the primary interest
of judges and arbitrators is missing (Barry 2009). It is possible that the delay occurred
as a result of an event that was not inserted or an event by the other party. Since the
timing of the delay event is not considered, it is possible that at the time when the
delay event had occurred, it was unlikely to impact the project duration, due to other
events that occurred elsewhere (Barry 2009).
Collapsed As-Built (or But-for Analysis)
As mentioned before, this technique uses the as-built programme as a basis.
The analyst studies the as-built information and constructs an as-built programme.
The analyst then removes the activities representing the Employers delays or
shortens the actual durations of delayed activities. If the Contractor failed to notify
the Engineer of the delay events to be included in the as-built programme, within the
timescale provided in Sub-Clause 20.1 [Contractor's Claims], the Contractor shall
lose his entitlement to the claim for extension of time. In this case, the Collapsed AsBuilt technique cannot be used. It should be however noted that, if the Contractor
meets the duration set for the notification but fails to submit the details and particulars
of the claim for extension of time, including the Collapsed As-Built analysis and the
collapsed as-built programme, within the required timescale, any extension of time
shall take account of the extent to which the failure has prejudiced proper
investigation of the claim by the Engineer.
If the Contractor succeeds to meet the timescales for the submission of the
notification and the particulars, this technique would most likely yield reliable results.
Thus, this technique is most successful when the delay events are incurred very close
to the end of the project. If such timescales are met, the Collapsed As-Built technique
would not be subjective, as the events inserted could be verified by the Engineer since
they represent contemporaneous information as they are prepared at the time of the
events which give rise to the claim. According to Sub-Clause 8.3 [Programme], the
Contractor is required to notify the Employer of future events which may delay
completion. The Contractor is required to submit a revised programme whenever the
previous programme is inconsistent with actual progress or with the Contractor's
obligations under the Contract. The Collapsed As-Built technique would not be used
in such case, as it is a retrospective approach.
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delays by all parties and thus takes into account concurrent delays. It includes any
measures made by the Contractor to mitigate the delays. In addition, it takes into
account the dynamic nature of the critical path. It should, however, be noted that if
the as-planned programme was not detailed and include logic relationships, it is
unlikely that the Windows technique shall give reliable results.
REFERENCES
Ahmed, Syed, Salman Azhar, Mauricio Castello, and Pragnya Kappagantula (2002),
Construction Delays in Florida: An Empirical Study, State of Florida:
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Barry, David (2009), Beware the Dark Arts! Delay Analysis and the Problems with
Reliance on Technology, Society of Construction Law.
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Ingineurs Conseile, Genve, Switzerland.
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Wallace, Duncan (1994). Hudsons Building and Engineering Contracts. Sweet &
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