THE JOURNAL OF AACE INTERNATIONAL THE AUTHORITY FOR TOTAL COST MANAGEMENT

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COST
THE BASICS OF

January 2012

ENGINEERING
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CONSTRUCTIVE ACCELERATION
OFFSETTING DELAYS
THE OWNERS FRIEND

FORENSIC SCHEDULE ANALYSIS:

EXAMPLE IMPLEMENTATION PART II

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CONTENTS

COST ENGINEERING

TECHNICAL ARTICLES 4 The Basics of Constructive Acceleration

James G. Zack Jr., CFCC FRICS

15 Offsetting Delays The Owners Friend

John C. Livengood, CFCC PSP

25 Forensic Schedule Analysis: Example Implementation Part II

Mark C. Sanders, PE CCE PSP

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TECHNICAL ARTICLE

THE BASICS OF

CONSTRUCTIVE ACCELERATION
James G. Zack Jr., CFCC FRICS

Abstract: Constructive acceleration is a well recognized claim in the US. The US federal governments Boards of Contract Appeals long ago created this claim and established the basic rules of entitlement concerning this type of claim. Thus, USbased contractors know what must be documented in order to recover in such situations. But when US contractors are working outside the US and are faced with this sort of situation, can they recover in arbitration or litigation in other jurisdictions? This article examines constructive acceleration in various legal jurisdictions (both common law and civil law) around the world to determine whether a contractor is able to use this type of claim to recover damages. This article was first presented at the 2011 AACE International Annual Meeting as manuscript CDR.521. Key Words: Arbitration, claims, civil law, common law, contractors, damages, and litigation

he constructive acceleration claim is a creation of the US Federal Boards of Contract Appeals (the Boards). Prior to 1978, the Boards were only empowered to hear claims arising under a contract. A claim not arising under a contract was typically classified as breach of contract, something the Boards could not hear. As a result all such claims had to be taken to the US Court of Claims. The constructive acceleration claim was devised prior to 1978, in order to give jurisdiction to the US federal agency appeals board as a claim on the contract and not for its breach.[1] One English barrister, Professor Ian Duncan Wallace, has termed constructive acceleration as a, fictitious doctrine not founded on

consensual or quasi-contractual basis[2]. Regardless of this opinion, the doctrine of constructive acceleration is a well recognized legal theory in the US.

The Basics of Construction Acceleration The earliest cases issued by the Boards, in the 1960s, established a standard six point test to determine whether constructive acceleration It is noted that some authors occurred on a contract [3]. Various condense these points to five, four, or authors have summarized these even three. Notwithstanding whether requirements as follows. they are compressed or not, this standard The contractor must have set of rules meets the basic construction encountered excusable delay or claims equationentitlement, causation, delay for which a time extension is and damages. (For a more thorough discussion of warranted under the terms of the the doctrine of constructive acceleration see Constructive Acceleration: Waking

contract (whether the delay is compensable is irrelevant). The contractor must timely submit notice in accordance with the provisions of the contract and follow up with a proper request for time extension. The time extension must be denied, in whole or in part, or otherwise postponed (i.e., not responded to at all, which after some reasonable period of time is deemed a denial). The owner or their representative must act by coercion, direction, or in some other manner that can reasonably be construed as an order to complete the work within the unextended time. The contractor must provide notice that they construe this action to be a directive to accelerate. And, The contractor must actually accelerate the work, incur and document their added costs [4].

COST ENGINEERING JANUARY 2012

the Sleeping Giant by Thomas F. Peters [5]; Reconciling Concurrency in Schedule Delay and Constructive Acceleration, by W. Stephen Dale and Robert M. DOnofrio [6]; and, A Government Windfall: ASBCAs Attack on Concurrent Delays as a Basis for Constructive Acceleration, by W. Stephen Dale and Kathryn T. Muldoon [7].) Subsequent to 1978, with the passage of the Contract Disputes Act of 1978, the US Boards were given broader jurisdiction over claims arising under government contracts, including breach of contract claims [8]. Nevertheless, the legal doctrine of constructive acceleration remains firmly established and has developed into a well known and relatively common claim on construction projects.

their acceleration efforts, plus the late completion damages imposed under the contract! Lets now look at various countries around the globe to determine whether the legal concept of constructive acceleration is recognized and, if it is not, is there another legal mechanism a contractor can use to recover such costs in situations such as this?

Australia
Even though Australia is one of the Commonwealth countries, its courts differ from English courts. While Australian law does not recognize the term constructive acceleration, there is a leading court case, commonly cited, where an Australian court awarded acceleration damages to a contractor despite the fact that the owner never ordered acceleration of the work. In the Australian case of Perini Pacific v Commonwealth of Australia (1969), Mr. Justice Macfarlane, in the Commercial Court of New South Wales, indicated clearly that this type of claim could only be on the basis of some proven breach of contract by the owner;coupled, of course, with proof of damages in the form of completion to time by expenditure greater than would otherwise have been incurred. In that case, the breach consisted of a refusal or failure by the certified to give any consideration at all to the contractors applications [9]. In this case, the contract administrator repeatedly refused to award extensions of time (EOT), and the contractor accelerated to complete the project on time in order to avoid being assessed liquidated damages. Under the terms of the contract, the owner had an implied duty to ensure that the contract administrator was properly administering the EOT provisions of the contract. The court found that the owner did not live up to this obligation and the proven breach of the implied terms gave rise to a claim for damages. The court awarded the cost of acceleration to the contractor [10]. As a result of this ruling, where the contractor feels obliged to accelerate because claimed EOTs have been rejected or are not being approved in a

Is Constructive Acceleration Recognized by Courts Outside the US?

The issue for this article is to respond to the above question. If a contractor is working outside of the US and encounters the situation set forth above, do they have the legal right to file a constructive acceleration claim? The issue arose some time back when the author was working with English barristers on a claim in the Mideast. When the author asked if the contractor had filed a notice of constructive acceleration, the barrister client advised that, English law does not recognize that legal concept. It occurred to the author that owners who refuse to issue time extensions when they are due, force contractors into a Hobbesian choice. Either the contractor refuses to accelerate and waits until the end of the project to gamble that they can convince an arbitration panel or court that they did not cause the delay, and the owner has no right to impose liquidated damages, or the contractor opts to accelerate the work to complete on time and pursues damages from the owner for the cost of the acceleration. However, should the contractor accelerate and then learn they are working in a jurisdiction that does not recognize the concept of constructive acceleration, they may face twin economic lossesthe cost expended on

timely way, and the contractor feels it is faced with the need to accelerate to avoid incurring penalties the failure to grant EOTs in a timely manner can be interpreted as an instruction to accelerate [11]. In other cases, Australian courts have looked to the English law rule concerning, acts of prevention. Should the owner act in some manner as to delay the project and then refuse to grant an appropriate time extension, and coerce the contractor into acceleration, Australian courts are likely to award the resulting damages to the contractor [12]. Conclusion: Even though Australian courts have not adopted the term, constructive acceleration, if a contractor can prove that the delay to the project was not caused by the contractor; that they submitted timely time extension requests; that the contract administrator failed to grant the appropriate time extension; that the owner knew the contract administrator was not administering the contract correctly; then the contractor can successfully argue the owner breached their implied duties and owes the resulting damages. In the alternative, the contractor may be able to pursue the claim under the act of prevention theory common in English law. In either event, the contractor will still be held to the standard of proving their damages.

Brazil
Brazil is a civil law country and decisions of courts are not published nor do they have any precedential value. However, the author contacted a Brazilian scheduling expert and claims consultant to learn whether the concept of constructive acceleration is recognized in Brazil. It was reported that, In Brazil, recovery of costs by contractors has always been a gray zone. I have prepared claims for constructive acceleration in two power plant projects. In one, we managed to get some of the money back, but in the other one, the [owner] alleged [a] force majeure and the case went to court with no recovery of the losses [13]. Conclusion: Brazilian law does not recognize the concept of constructive

COST ENGINEERING JANUARY 2012

acceleration. There appears to be little likelihood of recovery of such costs legally.

Canada
Canadian courts have not expressly recognized the term, constructive acceleration, as US courts have. One Canadian attorney commented on this in the following manner. Consideration of constructive acceleration expressly by Canadian courts is rare In reviewing Canadian cases on acceleration, those contractors which have proven facts which look remarkably like the shopping list of elements of constructive acceleration have tended to be successful with their claims. On the other hand, if one reviews the claims which have been denied, one can easily pick out which of the elements is missing. This despite the fact that one will be hard pressed to find Canadian cases which have expressly adopted the term, constructive acceleration, or have adopted the five listed criteria[14]. There are, however, two benchmark Canadian cases that firmly established a mechanism by which a contractor in a constructive acceleration situation may be able to recover. In Morrison-Knudsen Co. Inc. v. British Columbia Hydro and Power Authority, the court found that the owner was in fundamental breach of contract respecting payments for acceleration [15]. Both the trial court and the appellate court found that (1) the owner refused to grant time extensions for both owner caused delays, as well as other delays beyond the contractors control; and, (2) the owner demanded on time completion of the work. As a result, the court determined that the appellants (the owner) conduct respecting payment for acceleration constituted fundamental breach (of contract). Likewise, in W.A. Stevenson Construction (Western) Limited v. Metro Canada Limited, the court found that the owner refused to grant any times extensions when requested by the contractor, both

for owner caused and excusable delay [16]. The court also determined that the owner issued demands that the contractor accelerate the work, reminded the contractor that time was of the essence of the contract and that the costs of acceleration would be at the contractors sole expense. The court concluded that, In a deliberate, anticipatory breach of contract by means of a policy decision, the owner decided that the time for completion would not be extended, no matter what the cause. Conclusion: Despite the fact that Canadian courts have not adopted the term, constructive acceleration, if a contractor can prove the situation met all of the six criteria set forth above, then they can claim breach of contract in order to perfect the claim and recover their acceleration costs.

Where due to the fault of the employer, the project is stopped or postponed in the course of the construction, the employer shall adopt measures to offset or reduce the losses and compensate the contractor for the losses and actual expenses recurred thereof due to stopping and idling of the labor force, changes in the transportation, removal of the machinery and equipment, overstocking of materials and building components. The author of the private paper referred to above suggested that in situations where owner caused delay has occurred; the contractor has requested appropriate time extensions; and the owner has refused to grant extensions of time and demands on time completion; the contractor needs to obtain the owners demand for on time completion in writing. If all of this is done, then the contractor may be in a position to file suit for damages arguing, directed or instructed acceleration based on the employers breach of contract. It was also suggested that Chinese culture and business practice may assist in resolving such claims, as there is little tendency to pursuing disputes in litigation. Conclusion: Chinese law does not recognize constructive acceleration, but does require an owner to appropriately adjust the time of completion and pay for delay damages for owner caused delays. However, should the owner refuse to issue appropriate time extensions and demand on time completion, the contractor should insist that the on time completion instruction be put in writing. Once this is received, the contractor is in a position to seek recovery of acceleration costs, arguing that the owner breached the contract (which incorporates Chinese construction law by reference) and instructed acceleration.

China
The Peoples Republic of China does not recognize the concept of constructive acceleration in their Contract Law of The Peoples Republic of China [17]. Nor is constructive acceleration included in the Chinese Construction Contract of Construction Works (GF-1999-0201) [18]. Chinese construction law and contracts distinguish between acceleration, mitigation, and expediting. Acceleration is an increase in resources and intensity of work with the aim of bringing the job in on time. Mitigation means reallocating existing resources in order to minimize cost and delay resulting from changed conditions. Expediting is a result of contractor caused delay, and results in the contractor taking measures to meet the completion date at their own expense [19].

Colombia
However, Article 284 of the Contract Law of The Peoples Republic of China mandates the following A private e-mail response to the authors inquiry concerning constructive

COST ENGINEERING JANUARY 2012

acceleration in Colombia elicited the following response. there is a substantial parallel between US and Colombia, similar steps, somewhat different mix of characters and a different emphasis on all the pieces of handling claims [20]. Conclusion: Despite the fact that Colombia is a civil law nation, it appears from the above that their legal system may provide for recovery of acceleration costs in a constructive acceleration situation; provided that, the contractor complies with the six steps justifying constructive acceleration and can document each point.

second point, as well as the fifth point of the six point test for constructive acceleration. This argument is counterbalanced by other Egyptian attorneys who argue that it is a well established Civil Code principle that, the contract is the law of the parties. Conclusion: Egyptian law does not recognize constructive acceleration. Nor does it recognize the concept of excusable delay and notice provisions may or may not be enforced. A contractor facing a constructive acceleration situation probably cannot recover acceleration costs incurred to recover lost time resulting from excusable delay situations; but may be able to recover such costs incurred in recovering lost time because of owner caused delay under a breach of contract theory. If, however, the contractor can negotiate all six conditions related to constructive acceleration into the contract the Civil Code concept that, the contract is the law is likely to prevail.

predilection to reduce liquidated damages or penalties when actual damages are lower and acceleration can only be ordered by adding bonuses to the cost of the contract.

Germany
Most contracts in Germany are executed under the Allgemeinen Vertragsbedingungen fur die Ausfuhrung von Bauleistgungen (VOB/B), the German contract Terms for the Execution of Construction works. The VOB/B is a preformulated set of terms and conditions designed for the addition and partial modification of German law as it applies to construction contracts [25]. There is no recognition of the concept of constructive acceleration in the VOB/B. Section 6 of the VOB/B deals with the issue of hindrances and delay. Should the owner hinder or delay the contractors performance, the contractor is obligated to give notice to the owner and the owner is obligated extend the deadline for completion the work. The contractor is also entitled to seek recovery of reasonable damage compensation under Clause 6 of the VOB/B, as well as 642 of the German Civil Code. Should the owner refuse to issue time extensions and demand on time completion the contractor may be able to recover their acceleration costs. Conclusion: A contractor facing a constructive acceleration situation may be able to recover acceleration costs arguing acts of hindrance and breach of contract for failure to issue time extensions in a timely manner.

Egypt
The Arabic Republic of Egypt is a civil law nation and as such, has no case law. Construction projects, generally, are governed by Egyptian Civil Code [21]. In response to the authors inquiry concerning the recognition of constructive acceleration under Egyptian law, one claims consultant working in Egypt responded with the following. From my 13 years of experience in working in Egypt so far, I can generally tell you that constructive acceleration is not recognized here. there is also no recognition of delay analysis techniques either, so the principle of an excusable delay (point 1 in the US conditions for contractors recovery) does not exist [22]. The author has worked in Egypt on three different projectstwo in Alexandria and one in Cairoand based on this experience concurs that Egyptian Civil Code offers relief to the contractor only for owner caused delay. There is another problem concerning the concept of constructive acceleration under Egyptian Civil Code. Many attorneys argue that the Statute of Limitations renders notice provisions in Egyptian contracts unenforceable by law [23]. As such, many courts and arbitration panels ignore the notice provisionsthus eliminating part of the

France
France too is a civil code country, so no case law as we know it in the US exists. French Civil Code gives judges great discretion to reduce or increase contractually agreed penalties and liquidated damages. There are a number of cases where French courts have reduced the delay penalties to be paid by a contractor because the delay was in total or in part attributable to the behavior of others, such as either the main contractor or the owner[24]. Based on a reading of French law, set forth in this article, the only way to accelerate the work of the project is to offer an incentive or bonus for such acceleration. Accordingly, French law does not recognize the concept of constructive acceleration. Conclusion: A contractor working on a project governed by French law who encounters delay and an owner, who refuses all requests for time extension, is better off to not accelerate the work to attempt to recover the lost time. French courts have the power and the

Hong Kong
Hong Kong courts, like many other Commonwealth courts, do not recognize the concept of constructive acceleration. Claims on this basis [constructive acceleration] are common in the US, but in Hong Kong there is no such doctrine [26]. However, they do subscribe to the legal theory of mitigation of damages, a concept that is based upon UK law. As one author pointed out, contractors have for many years looked to recover from employers the additional costs of implementing delay mitigation measures (additional costs to normal working excluding prolongation) even

COST ENGINEERING JANUARY 2012

where there was no employers instruction to implement such measures[10]. Additionally, Hong Kong courts recognize the contractors ability to recover acceleration costs incurred as a result of owner caused delay where the owner refuses to grant time extensions. Like other courts, Hong Kong courts acknowledge this as a breach of contract. They do, however, uphold notice provisions and require that the contractor document the delay mitigation measures and costs accurately. Conclusion: Despite the lack of acceptance of the theory of constructive acceleration, contractors caught in such a situation in Hong Kong, may still be able to recover damages using the mitigation of delay or breach of contract theories.

Conclusion: As much of Indian law is drawn from English common law it appears that Indian courts do not recognize the doctrine of constructive delay, but are amenable to legal arguments centered on delay mitigation, time at large, and/or breach of contractual obligations.

Indonesia
In another e-mail response to the authors inquiry, Mr. Asrizal Sabri, an Indonesian project manager, responded with the information that Indonesian laws recognize the right of contractors to recover damages resulting from acceleration resulting from owner caused delay or force majeure events [29]. Reference was made to Keppres No. 80 (Republic of Indonesia Laws) in support of this statement [30]. Keppres No. 80 was the Indonesian governments attempt to align their procurement process with those of other nations and, as such, the government imported legal and contractual concepts from many other countries. The e-mail response also pointed out that for a contractor to recover such costs they will need to obtain written documentation that the owner has demanded acceleration. Conclusion: Although it is not clear which legal theory contractors may rely upon to recover constructive acceleration costs, what appears to be clear is that if the contractor can prove excusable delay, the owners refusal to grant time extensions, and the owners demand that the contractor take action to recover the lost time, then the contractor may have a legal right to recover damages.

India
In response to the authors inquiry concerning the recognition of constructive acceleration in Indian courts, the following was provided: Contractor is entitled to acceleration with costs when/if: Schedule is delayed due to force majeure and client requires original end date to be met Client is direct cause of delay to schedule, but still requires original date to be met There is no general (national) law which specifically prescribes when a contractor can, or cannot claim acceleration costs. [27] Additionally, Indian courts recognize the time at large concept, wherein if there is an act of hindrance by the owner or their agents, or force majeure events, then a time extension is owed to the contractor. Should the owner refuse to grant such a time extension, then it can be said that time is at large and as there is no longer a date from which liquidated damages can be calculated, the owner loses their right to impose liquidated damages [28]. If the owner demands on time completion the contractor may be able to recover on the basis of breach of contract.

provision in those clauses for the payment of pure acceleration costs. A mere voluntary decision by the contractor to accelerate is not enough to found a claim for constructive acceleration. There must be some element of undue coercion by the employer, which compels the contractor to accelerate [34]. Conclusion: It is not clear if Irish courts will adopt the concept of constructive acceleration. But, if a contractor can prove delay entitlement; the owners refusal to allow an extension of time; coercion by the owner forcing the contractor to accelerate work; and actual damages, then costs may be recoverable under the loss and expense or damages clauses of RIAI, GDLA 82 or IEI contract. Additionally, since Irish courts are heavily influenced by English courts, the legal concepts of breach of contract, delay mitigation and/or time at large may also assist in recovery of damages.

Malaysia
Many projects in are constructed using the PAM, the JCT, or the ICE for of contract [35, 36, 37]. As such, Malaysian contracts recognize the legal concepts of act of prevention or act of hindrance and time at large. The Malaysian Federal Court in Sim Chio Huat v Wong Ted Fui dealt with a case where the contract had a liquidated damages provision but did not have a time extension clause [38]. The court ruled that the owners delay in providing the site and the issuance of extra work orders operated to set time at large and render inoperative the liquidated damages clause. Mr. Dennis Oon Soon Lee, a Malaysian construction manager, has analyzed the issue of constructive acceleration under Malaysian law and concluded that this concept is not recognized. However, he also determined the following. where it can be shown that the contract administrator has unreasonably or unnecessarily delayed the grant [of] extensions of time, there is little difficulty in establishing that this is a breach of contract by the employer. In cases which deal with the failure to grant an extension of time and the effect that this has on the liquidated damages

Ireland
Many projects in Ireland are contracted for under RIAI, GDLA 82, or IEI form of contract [31, 32, 33]. None of these contracts expressly recognize the concept of constructive acceleration. However, all of them provide for recovery of loss and expense or damages, as well as time extensions. Some causes of delay may also entitle the contractor to claim loss and expense or damages, under RIAI/GDLA clauses 2 and/or 29(b) [as well as under IEI clause 44] However there is no

COST ENGINEERING JANUARY 2012

provisions, it appears to be accepted that the said failure by the contract administrator is a breach of contract by the employer. That a distinction needs to be made between an express refusal or continued failure to deal promptly with an extension of time application on the part of the contract administrator, and an honestly held view or assessment that no extension of time is due. The issue however is when can the contract administrator be considered to have unreasonably or unnecessarily delayed the grant of an extension of time [39]. However, as noted by Mr. Oon Chee Kheng in a thorough article on time extensions and liquidated damages under Malaysian law, It remains to be said that even if loss and expense or costs of constructive acceleration is claimable, this is strictly beyond the jurisdiction of the Engineer/Architect/S.O., and the same can only be pursued in arbitration or litigation. Loss and expense and costs are both contractual financial compensation mechanisms and the Engineer/Architect/S.O. can only certify these arising from constructive acceleration if there are contractual provisions to that effect [40]. Conclusion: Malaysian courts do not recognize the constructive acceleration legal theory. They do, however, acknowledge the legal concepts of acts of prevention/hindrance, time at large and breach of contract. Thus, if a contractor can prove entitlement to a time extension and refusal of the owner to issue the time extensions warranted by the contract, plus the damages incurred by the contractors acceleration efforts, then the contractor may be able to recover such damages but will have to do so in arbitration or litigation.

Oman
Omans legal system is based on civil code principles and, in particular, Egyptian Civil Code. Privately financed contracts in Oman are generally governed by Egyptian Civil Code. However, Oman adopted a form of contract general conditions based on the International Federation of Consulting Engineers (FIDIC) documents. Public

works project in Oman are subject to this latter set of conditions [41]. Constructive acceleration is not a recognized concept under the FIDIC documents as the FIDIC document were adapted from the Institute of Civil Engineers (ICE) documents. As the ICE documents were developed by an English professional society, it is not unexpected to find that they do not recognize this concept. However, when working under a FIDIC contract, should the owner refuse to issue appropriate time extensions, the contractor is not compelled to accelerate their work unless so ordered in writing by the owner. (If such an order is issued, this becomes a directed acceleration under Clause 8 of the FIDIC documents.) Under English law one of the primary areas of concern with respect to these provisions would be the potential applicability of the doctrine of acts of prevention. Under this doctrine if there is no provision for an extension of time or none is granted when it should have been and if an employer prevents through his own actions the contractor from completing within the specified time for completion, time becomes at large and the contractor is given a reasonable time in which to complete Peak v. McKinney (1969) 1 BLR 111 (CA). Liquidated damages fall away [42]. In a situation where a contractor is working on a privately financed contract subject to Egyptian Civil Code and faces constructive acceleration situation, acceleration costs may be recoverable in accordance with the earlier discussion of Egyptian law above. Conclusion: Oman law does not recognize the concept of constructive acceleration as such. As many contracts in Oman are executed under FIDIC contracts a contractor in this situation is not compelled to accelerate if they are delayed by act of the owner. The contractor can assert the argument that the delay was an act of prevention and time is now at large (i.e., there no longer exists either a completion date or liquidated damages) and the contractor is free to finish the work within a reasonable period of time. Should the contractor be working on a privately funded contract, subject to the provisions of Egyptian Civil Code

then a contractor facing a constructive acceleration situation probably cannot recover acceleration costs incurred to recover lost time because of excusable delay situations; but may be able to recover such costs incurred in recovering lost time because of owner caused delay under a breach of contract theory.

Singapore
Projects in Singapore are frequently constructed under the JCT, ICE, or the PSSCOC form of contract [43]. None of these contract forms recognize or acknowledge the concept of constructive acceleration [44]. Like Malaysian courts (discussed above) courts in Singapore recognize the concepts of act of prevention or act of hindrance, time at large, and breach of contract [45]. Conclusion: The courts of Singapore do not recognize the constructive acceleration legal theory. They do, however, acknowledge the legal concepts of acts of prevention/hindrance, time at large and breach of contract. Thus, if a contractor can prove entitlement to a time extension and refusal of the owner to issue the time extensions warranted by the contract, plus damages incurred by the contractors acceleration efforts, then the contractor may be able to recover such damages.

South Africa
South African law and courts do not recognize the doctrine of constructive acceleration. The argument adopted by many contractors in South Africa namely that a rejection to an EOT request which the contractor believes is correct amounts to an instruction to accelerate and finish on time is simply incorrect. The refusal to grant an EOT cant amount to a deemed instruction to accelerate. A claim for constructive acceleration under English law must be based on ordinary principles for breach of contract and damages[46]. However, it has been pointed out that under FIDIC, NEC, JBCC, and the SAICE [47, 48, 49]: The engineer owes a duty of care towards the contractor in administering

COST ENGINEERING JANUARY 2012

the contract to determine such [time] extension and is obliged, not entitled, to carry out this function. It is the engineer and not the employer who must determine and grant the extension. The engineer is obliged to reach a decision and convey this decision to the contractor within a reasonable period of time after the extra or additional work or other special circumstances have arisen [50]. Conclusion: Based in this principle, the failure of the engineer to properly administer the time extension provisions of the contract is likely a breach of contract. Should the owner then demand on time completion thus causing the contractor to accelerate their work, damages will arise which should be recoverable as they flow from the breach of contract. It would appear, however, that the contractor must obtain the owners demand for on time completion in writing as South African courts apparently do not accept a deemed instruction to accelerate.

based upon the above information, the circumstances under which such damages may be recovered are not known. Should a contractor begin to become involved in such a situation, contact with competent legal counsel is requiredsooner rather than later.

violation of Article 246. He goes on to suggest that, if there was an act of bad faith that resulted in the contractor incurring additional costs, then the defaulting party or parties responsible could be liable to pay compensation. He noted also that Article 282 of the Civil Code states that: Any harm done to another shall render the perpetrator, even if he is a minor, liable to make good the harm. Conclusion: Notwithstanding the fact that UAE law does not recognize the doctrine of constructive acceleration, it is possible for a contractor to recover damages under the UAE Civil Code if the contractor follows the requirements of the contract concerning notice and time extension requests and can prove that the engineer failed in his duty to act impartially.

Trinidad and Tobago

In response to the authors inquiry concerning recognition of the doctrine of constructive acceleration in Trinidad and Tobago, Mr. Stanley West, Past President of AACE Internationals Caribbean Section respondedTwo of the senior lawyers who deal with contracts are not familiar with the term and as such have no knowledge of any court case or other claims dealing with constructive acceleration [52]. Conclusion: Since the laws of Trinidad and Tobago are based in English law, it is presumed that even though Trinidadian courts do not recognize constructive acceleration as a legal doctrine, they would most likely subscribe to the concepts of act of hindrance or act of prevention, time and large and breach of contract. United Arab Emirates (UAE) In a short but very informative article, Mr. Chris Larkin, an English Chartered Engineer, with a law degree and arbitration qualifications, advised that the doctrine of constructive acceleration is not recognized in the UAE [53]. However, Mr. Larking notes that Article 246 of the UAE Federal Law No. 5 of 1985 (the Civil Code) contracts must be performed in a manner consistent with the requirements of good faith Mr. Larkin opined that this applies both to the parties to the contract, but also to the person who has the power to award extensions of time and certify payment application. He noted, for example, that under the FIDIC Redbook, 4th Edition, the the engineer has a duty to determine the extension of time that the contractor is fairly entitled to. In exercising this duty, the engineer must act impartially within the terms of the contract Mr. Larking suggested that if the engineer did not perform their duty fairly, then they could be found in

United Kingdom (UK)

In a classic bit of understatement, R.D. Pickles wrote The English courts have been a little slow at recognizing a situation where a claim for constructive acceleration would be relevant [54]. In fact, Professor Ian Duncan Wallace, editor of Hudsons Building and Engineering Contracts, has gone on record by declaring the doctrine of constructive acceleration a fictitious doctrine not founded on consensual or quasi-contractual basis and would not be acceptable in English Courts and Commonwealth Courts [55]. Numerous other schedule and schedule delay texts out of the UK agree with the statement that the doctrine of constructive acceleration is not yet recognized in UK courts [56]. What is acknowledged, however, is the owner and engineers duty to administer the contract in accordance with the terms of the contract. Thus, if some action of the owner or the engineer constitutes an act of hindrance or an act of prevention; the owner or engineer refuses to grant an appropriate time extension; the contractor is

Sri Lanka
Not much is known concerning constructive acceleration in Sri Lanka. However, the following was reported. Sri Lankan Precedent: Of particular interest is the report of a hallmark case in Sri Lanka involving the construction of irrigation canals. In that case the contractor was forced to spend a large sum on duplicating his temporary equipment because of the failure of the principal agent to award an extension of time timeously. The ICC Arbitration awarded the contractor some US $56 million being approximately 95 percent of its proven costs of constructive acceleration. What makes this case of particular interest is that the law of the contract was Sri Lankan law and Sri Lanka is one of the few countries outside South Africa having a Roman-Dutch legal foundation [51]. Conclusion: Recovery of constructive acceleration damages is potentially possible in Sri Lanka, but

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pressured or coerced to make up the lost time; the contractor accelerates and incurs actual costs; then under the legal concepts of prevention, time at large and breach of contract, the contractor may be able to recover their acceleration costs. However, as one author pointed out, Under the Housing Grants, Construction and Regeneration Act, the contractor now has the option to address this uncertainty at an early stage by referring his claim for an extension of time to an adjudicator during the course of the contract, rather than to the court or an arbitrator after completion [57]. This is probably the right way to go, given the problems with acceleration [58]. Thus, contractors faced with a constructive acceleration situation can seek adjudication, which typically takes a very short period of time, whenever the owner or engineer denies a time extension and attempts to make the contractor recover the lost time. It is also noted that one English court case within the last few years came very close to acknowledging constructive acceleration. In Motherwell Bridge Construction Ltd v Micafil Vacuumtechnik, the court ruled that the claimant was entitled to the costs of the measures taken to achieve completion earlier than contractually necessary [59, 60]. Conclusion: Even though English courts do not currently recognize the concept of constructive acceleration, they appear to be moving in this direction. If a contractor finds themselves in a constructive acceleration situation, and the contract is under the jurisdiction of the Housing Grants, Construction and Regeneration Act, the first step should be to refer the dispute to adjudication to seek a decision by a neutral decision maker. In the absence of this, contractors seeking recovery of constructive acceleration costs will need to document acts of prevention or hindrance, coercion to obtain completion earlier than should be been allowed, and breach of contract. If the contractor in such a situation can prove these points, then they should be able to recover their acceleration costs.

Conclusions

n all countries outside the US included in this survey, the concept of constructive acceleration is not recognized, at least under this name. But in most of the countries listed above, contractors who have been constructively accelerated because of the refusal of the owner to grant time extensions when warranted followed by coercion to force on time completion, contractors may recover some or all of the damages incurred using a number of other legal theories. The common theme supporting these alternative legal theories seems to be the following. Fixed Period RequirementThe contract must have a Time of the Essence Clause and a Time of Completion requirement accompanied by some sort of late completion damages clause. After all, if time is not important to the project owner, then the contractor is simply held to a standard of completing the work within a reasonable time. Contract Provides for Extensions of TimeThe contract must have language which allows the owner to extend time under certain circumstances. That is, the owner must have the legal ability under the contract to grant time extension. If there is no clause providing for time extensions then the owner cannot be said to have breached their obligation by not granting such extensions. Meet the Six Step Checklist for Constructive Acceleration Contractors seeking recovery of acceleration costs resulting from an owners refusal to grant a time extension probably have to demonstrate the following to the trier of fact. Excusable delay was encountered. Notice was provided to the owner and appropriate time extension requests were submitted.

The owner issued no time extension or less time than should have been allowed. The owner threatened or coerced the contractor into accelerating their work in order to recover some or all of the lost time. The contractor provided notice to the owner that they considered the owners actions to be a directive to accelerate. And, Finally, the contractor did actually accelerate and can document their actions and the resulting damage. Arbitration or Litigation is Required It appears from the results of this survey that, unlike the US, this is not a claim that can be negotiated to settlement on the job site. Rather, as most countries deal with this sort of claim in the context of breach of contract (as did the US prior to the Contract Disputes Act of 1978), then the claim in most countries will most likely have to go to arbitration or litigation.

REFERENCES
1. Bramble, Barry B. and Michael T. Callahan, Construction Delay Claims, 2nd Edition, 6.8, Wiley Law Publications, New York, pages 178182, 1992. Hudsons Building and Engineering Contracts, 11th Edition, 7-050, Sweet & Maxwell, London, England, 1995. See, for example, Lewis Constr. Co., ASBCA 5509, 60-2 BCA 2732; Mechanical Utils., Inc., ASBCA 7345, 1962 BCA 13,260; and Electronic & Missile Facilities, Inc., ASBCA 9031, 1964 BCA 4338. See Cibinic, John, Ralph C. Nash and James F. Nagle, Administration of Government Contracts, 4th Edition, pp. 445 458, George Washington University, Washington, D.C., 2006; see also, Wickwire, John M., Thomas J. Driscoll, Stephen B. Hurlbut and Mark J. Groff, Construction Scheduling: Preparation, Liability and Claims, 3rd Edition, 7.10(B), pp. 268 271,

2.

3.

4.

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5.

6. 7. 8. 9.

10.

11.

12.

13.

14.

15. 16. 17.

18.

19.

20.

21.

Wolters Kluwer Law & Business, New York, 2010. AACE International Transactions, AACE International, Morgantown, WV, 2004. Public Contract Law Journal, Volume 39, No. 2, Winter 2010. Procurement Law, Summer 2009. 41 U.S.C. 601-613, 1988. Lyle, Bryce, What is Constructive Acceleration? MasterBuilders KwaZulu-Natal, August 2009. Rawling, Brian E., Delay Mitigation, Brian E. Rawling & Associates, Ltd., Winter 2005/6. Weaver, Patrick, Delay, Distruption and Acceleration Costs, Mosaic Project Services Pty Ltd, South Melbourne, Victoria, 2005. Cremean, Damien J., B.A. Shnookal, and Michael H. Whitten, Brookings on Building Contracts, 4th Edition, Section 6.8, LexisNexis Butterworths, Australia, 2004. Private e-mail communication from Aldo Dorea Mattos, Aldo Mattos Consulting, April 20, 2010. Grenier, Glenn, The Traps and Pitfalls of Construction Delay Claims in Ontario, Lang Michener LLP, Toronto, Ontario, 2005. D.L.R. (3d) 186 (B.C.C.A.) 1978. 27 C.L.R. 113 (B.C.S.C.) 1987 Adopted and promulgated by the Second Session of the Ninth National Peoples Congress on March 15, 1999. Issued by the Ministry of Construction of the Peoples Republic of China and the Bureau of Industrial and Commercial Administration of the Peoples Republic of China on December 24, 1999. Zhang, JianHua, Construction Acceleration in China, an unpublished paper prepared in response to the authors inquiry concerning constructive acceleration in China, April 25, 2010. See also Richter, Irvin E., International Construction Claims: Avoiding & Resolving Disputes, McGraw Hill Publications, New York, pages 73-77, 1983. E-mail response from John Smith, a recognized US construction claims consultant and testifying expert, currently retired and living in Bogota, Colombia, May 3, 2010. Articles 646 to 667.

22. E-mail response from Waleed El Nemr, April 20, 2010 and presentation slides by Dr. Sheif El Haggan, FIDIC Middle East Contract Users Conference, Abu Dhabi, February 25, 2010. 23. Article 388, Egyptian Civil Code. 24. Colaiuta, Virginie A., How French Courts Discretionary Power to Reduce Delay Penalities and Liquidated Damages May Affect Acceleration of Works in Construction Projects, IBA Conference, Session on Time and Acceleration Issues Affecting International Construction Contracts, Madrid, 2009. 25. Osing, Dr. Stefan, Time and Acceleration Issues Affecting International Construction Contracts: The German Approach, paper presented at the IBA Annual Conference, Madrid, 2009. 26. Molloy, John B., Constructive Acceleration A Valid Claim? Hong Kong Institute of Surveyors, Feature Article, July 2002. 27. E-mail response from Madhu Ponnappan Pillai, AACE Regional Director and project management consultant in India, April 22, 2010. 28. Westwood v. Secretary of State for India (1863) 1 New Rep 262, citing Holme v. Guppy (1838) 3 M&W 387. See also: Roberts v. Bury Commissioners (1870) LR 5 CP 310. 29. E-mail response from Asrizal Sabri, Indonesian project manager, April 20, 2010. 30. Presidential Decree Number 80 of 2003. 31. Royal Institute of the Architects of Ireland. 32. Agreement and Conditions of Contract for Building Work for use by Government Departments and Local Authorities, March 1982. 33. Institution of Engineers of Ireland, Conditions of Contract for use in Connection with Works of Civil Engineering Construction, 3rd Edition, 1980, revised and reprinted October 1990. 34. Lyden, John M.E., Acceleration Claims on Construction Projects in Ireland, paper given to a meeting of the Society of Construction Law and the Society of Chartered Surveyors, Cork, Ireland, March 14, 2005. 35. The Malaysian Institute of Architects Form, 2nd Edition, 1998,

36.

37. 38. 39.

40.

41.

42.

43.

44.

45. 46.

modeled after the JCT form of contract but not updated as frequently. The Joint Contract Tribunal Standard Forms of Contract, 2nd Edition, 1998. The Institution of Civil Engineers Contracts, 7th Edition, 1999. 1 MLI 151, 1983. Oon, Soon Lee, Dennis, Extension of Time and Acceleration Claims, thesis submitted in fulfillment of the requirements for the award of the degree of Master of Science in Construction Contract Management, Faculty of Build Environment, Universiti Teknologi, Malaysia, March 2006. Khen, Oon Chee, Extension of Time and Liquidated Damages in Construction Contracts, paper presented at a seminar on Construction Contracts and Arbitration, sponsored by The Institution of Engineers, Malaysia (Perak Branch), Ipoh, Malaysia, October 18, 2003. Unpublished paper prepared by legal counsel at Trowers & Hamlyns, Muscat, Oman, dated October 21, 2008 and presentation slides by Dr. Sheif El Haggan, FIDIC Middle East Contract Users Conference, Abu Dhabi, February 25, 2010. Knutson, Robert, An English Lawyers View of the New FIDIC Rainbow Where is the Pot of Gold? Privately produced paper, London, June 2003. The Singapore Public Sector Standard Conditions of Contract, 3rd Edition, 2005. Stephenson, Andrew and Ian Bailey, Concurrency Causation Commonsense and Compensation, IBA Conference, International Construction Projects Committee, Madrid, 2009. Oon Soon Lee, Dennis, supra. Maritz, M.J. and Andries P. Shutte, A Practical Approach to Calculate Acceleration Costs on Construction Projects in South Africa, 5th Post Graduate Conference on Construction Industry Development, Department of Quantity Surveying and Construction Management, University of the Free State, Bloemfontein, South Africa, March 16-18, 2008.

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47. The New Engineering Contract, Institution of Civil Engineers, November 1995. 48. The Joint Building Contracts Committee, September 2007. 49. The South African Institution of Civil Engineers, 5th Edition, 1982. 50. Loots, P.C., Engineering and Construction Law, Juta & Co. Ltd., Cape Town, South Africa, 1985. 51. Binnington, Chris, Sri Lankan Precedent, The Civil Engineering Contractor, January 2006. 52. E-mail from Stanley West, Past President, AACE International Caribbean Section, dated April 29, 2010. 53. Constructive Acceleration Demands Clear Intentions, Construction Management Guide, September 18, 2008, retrieved from http://cmguide.org/archives. 54. Pickles, R.D., What Is Constructive Acceleration? Master Builders KwaZulu-Natal news, August 2009. 55. Hudsons Building and Engineering Contracts, 11th Edition, 7-050, Sweet & Maxwell, London, England, 1995.

56. See, for example, Keane, P.J. and A.F. Caletka, Delay Analysis in Construction Contracts, WileyBlackwell, London, 2008; and Lowsley, Stephen and Christopher Linnett, About Time Delay Analysis in Construction, RICS Business Services Limited, London, 2006. 57. Referring to Section 108, Right to Refer Disputes to Adjudication, of the Housing Grants Construction and Regeneration Act of 1996, Part II. This Act has more recently been amended by the Local Democracy, Economic Development and Construction Act of 2009, which requires that a contract specifically include provision in writing to this effect. 58. Winter, Jeremy and Jacqueline Mimms, Acceleration Claims, Baker & McKenzie, March 2002. See also, Gibson, Roger, Construction Delays, Extensions of Time and Prolongation Claims, Chapter 20, Routledge Taylor & Francis Group, London, 2008. 59. 81 Con LR 44; TCC, January 31, 2002.

60. Ndekugri, Issaka, A Legal Analysis of Some Schedule-Related Disputes in Construction Contracts, The Construction and Building Research Conference of the Royal Institution of Chartered Surveyors, Georgia Tech., Atlanta, September 2007.

ABOUT THE AUTHOR

James G. Zack, Jr., CFCC FRICS, is with Navigant Consulting, Inc.n He can be contacted by sending e-mail to: jim.zack@navigantconsulting.com

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TECHNICAL ARTICLE

OFFSETTING DELAYS
THE OWNERS FRIEND
John C. Livengood, CFCC PSP

Concurrency is primarily a legal theory dating from the early 1900s (although it was not called concurrency then). Most of the contemporary concurrency law we rely upon in the US was developed in the 1960s through the 1980s. During this period, judicial decisions reflected a careful dissection of the then available CPMs schedules that unfortunately generally made detailed Key Words: Concurrent delay, forensic schedule analysis, offsetting delay and allocation of responsibility impossible to sequential delay determine, hence more findings of concurrent delay [2]. Yet, concurrency as a legal theory Figure 2 illustrates a typical The Offsetting Delay Issue that is poorly understood and concurrency situation. inconsistently applied by courts and The authors definition of oncurrent delay is an experts [15, 22]. Concurrency has been important issue in virtually all concurrency, including offsetting delays characterized as, a risk allocation construction delay cases. The follows: principle that operates to distribute costs stakes are high, because if associated with contemporaneous delays Concurrent Delay is the there are two delays and they can be on a status quo basis [6]. Concurrency occurrence of two or more delay considered concurrent, then the operates in this manner because events at the same time one contractor is not entitled to delay historically the courts could not untangle an owner risk event, the other a damages and the owner is not entitled to the complicated fact patterns causing the contractor risk eventthe liquidated damages, although a nondelay. effects of which are felt at the compensable time extension is usually Offsetting delays are an extreme same time. The term granted [9]. type of concurrent delay. They arise concurrent delay is often used when the two delays meet the criteria of to describe the situation where

Abstract: When dealing with contractor delay claims, owners of construction projects often use their superior bargaining power to strike a deal better than the facts or the law would permit. This is especially true in cases where it is possible for the owner to argue sequential delays by the contractor should offset earlier delays caused by the owner, making both delays non-compensable. These delays have the special name of offsetting concurrent delays. Concurrent delays, particularly delays associated with performance of non-critical work, are poorly understood by the courts and schedule analysts alike. Savvy owners use this lack of understanding when negotiating settlements of delay claims by contractors. This article discusses the most recent technical issues associated with concurrent delay, and shows how confusion has made the legal rulings on concurrent delay unpredictable, thus strengthening the owners bargaining position and allowing for the popularity of offsetting delays claims. An earlier version of this article was first presented as manuscript CDR.609 at the 2011 AACE International Annual Meeting in Anaheim, Calif. The author has made some updates and revisions since that presentation and they are included with this printing.

two or more delay events arise at different times, so long as the effects of them are felt at the same time. This is generally referred to as offsetting concurrent delays.

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Figure 1 Concurrent Delay with Offsetting Delays Recognized concurrency, but occur at widely separated times. To illustrate, the same basic fact pattern will be used in figures in this article: The project was a two-building complex with a planned simultaneous start on both Buildings A and B. Both buildings had planned a ninemonth durationthey were on co-critical paths and both actually took 10 months to complete prior to commissioning. When both buildings were complete, there was a joint two month commissioning period leading to substantial completion. Figure 1 depicts the following scenario, typical of how the offsetting delays are negotiated: An aggrieved owner and delayed contractor hold a negotiating session after construction is complete on a two-building complex. The owner acknowledges that it had delayed site access for one month on Building A, resulting in an actual 10month duration for that building. Nevertheless, the owner believed that unrelated delays of one month associated with the contractors poor performance in completing mechanical work on Building B resulting in a 10month duration, which balanced out the initial delay on Building A. The owner reasoned that even had the delay to Building A not occurred, the total project would have been delayed a month because of the contractors delay on Building B. The owner offered a noncompensable time extension of one month. Under the following definition, the term concurrent does not carry the generally understood meaning of, at the same time. As the term is used in many cases, concurrent delays may occur during any part of the project performance period, not necessarily at the same time. The period of concurrency is the period of project performance, not just the period during which any individual delay may have occurred [4]. Rather, concurrent means under this construction the impact at the end of the project is the same for each delay [19]. Essentially, the delays that are being looked at and balanced against each other can occur at any time during the project. We will return to this timing problem after discussing the more general requirements for concurrency, as described in the AACE International Recommended Practice 29R-03 (2011) Forensic Schedule Analysis Practice Guide [FSAPG 29R-03], Subsection 4.2 [1].

Whats Required for Concurrent Delay

While FSAPG 29R-03 quotes five definitions of concurrent delay, it does not adopt any of them. Rather, the FSAPG 29R-03 defines seven criterion, all of which are needed for a concurrent delay, as listed below: 1. 2. Two or more delays that are unrelated, independent [6]; Either would have delayed the project even if the other delay did not exist [16]; Two or more delays that are the contractual responsibility of different parties, but one may be a force majeure event [6]; The alleged concurrent delay must be involuntary [13];

3.

4.

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Figure 2 Concurrent Delay During Same Measurement Period 5. The work associated with the alleged concurrent delay must be substantial and not easily curable; The delays, each of which absent the other, must independently delay the critical path [12]; and, 7. The delays must occur during or impact the same time analysis period. delayed because the specialized equipment and crews needed for that building were unavailable. Each delay, absent the other, delayed actual substantial completion, i.e., the events were on the critical path. None of the delays were voluntary and none were easily curabletextbook concurrency.

6.

Figure 2 depicts a typical concurrent delay situation. Building A had a one month delay because of owner-caused site access. Building B was initially

Figure 3 Concurrent Delay Along a Single Critical Path

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Figure 4 Concurrent Delay Under the Functional Approach With Two Delays Within the Same Measurement Period The first three of the above criteria are familiar to all who have encountered concurrent delays and are generally reflected in the usually cited definitions. For expert analysts, much of the work of establishing or rebutting a concurrency argument revolves around the proof of these issues. Equally important and discussed only briefly in the FSAPG 29R-03 is the burden of proof associated with concurrency. Concurrency is generally an affirmative defense initiated after there has been an allegation of delay [3, 6, 10]. Typically, one party will allege there was a delay, and the other party will respond with an allegation of concurrency. The party initially alleging concurrency bears the burden of proof for establishing concurrency [8]. Then the party asserting the original delay often presents its analysis showing a lack of concurrency. As a practical matter, most delay experts now routinely identify concurrency, or lack thereof, as part of their initial analysis. FSAPG 29R03 is written to reflect that identification of concurrency is often undertaken as part of the typical schedule delay analysis. The fourth and fifth criterion, added by FSAPG 29R-03 in the 2011 edition, are common sense additions. Criterion 4, the concurrent delay must be involuntary is simply a reflection that a voluntary delay otherwise meeting the concurrency criteria would be characterized as pacing, which is discussed extensively in the FSAPG 29R03 in Subsection 4.3 [1]. Criterion 5 reflects the practical reality that neither an owner nor contractor should be allowed to claim concurrency if the alleged concurrent delay is trivial. The sixth criterion requires that both alleged delays must be on the critical path, even in the presence of the other delay. This is almost identical to the second criterion that requires either would delay the project absent the other; however, there is a subtle difference. Criterion 6 means you cannot just subtract one of the delays to see if the other affects completion because subtracting one of the delays changes the critical path and could make other activity sequences critical [8]. So the test is that both delays have to be on the as-built critical path. As discussed below, this matter is one of the key issues related to offsetting delays. The seventh criterion the requirement that the delays be in the same time period is also discussed later in this article. Single or co-critical paths; Cause or effect; and, Lowest float or negative float

Other Concurrency Considerations

FSAPG 29R-03 also discusses several other essential issues associated with concurrency the analyst must consider when performing an evaluation. They include:

The first issue is the need for cocritical paths in order to have concurrency. Essentially, it asks if you can have concurrent delays when there is only one critical path? The answer is Yes. Co-critical paths are not required as concurrency usually occurs when there is only a single critical path [6]. Concurrency in these situations is more closely associated with the method of activity representation in the CPM network itself, and the fact that such networks are only approximations of the real logic connections between activities. As a result, it is almost always unnecessary and always unwieldy to put all the relationships into a schedule. Such a schedule would be so large, even on a moderate sized job, as to be unusable. The solution is to look at the causes of the delay. For example, as shown in figure 3, on a project with a single critical path starting with the first activity mobilization, the owner is unable to provide site access on the required date to Building A. At the same time and unrelated to the owners delay, the contractor is unable to mobilize its crews and equipment, also to Building A. There are two concurrent causes of delay to

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Figure 5 No Concurrency Delay Under the Literal Approach With Two Delays Separated by One Day the single critical path. These two causes could be depicted as separate activities in the CPM network prior to start of Building A critical path. However, such a level of detail is unnecessary in a CPM even if it is necessary to identify and to determine concurrency. It is sufficient to recognize there are two events (otherwise meeting the seven criteria) causing a delay. Closely related to this issue is the second issue of cause or effect. Is the concurrency being discussed associated with the event that causes the delay, or the manifestation of the delay itself? This often appears where there are noncritical delays that lead to a critical path delay. For example, assume a schedule activity with a planned duration of seven days has slow productivity and extends for another three days for a total duration of 10 days. The delay does not manifest itself until the activity fails to be completed on the seventh day. The delays were earlier, but the effects of these delays do not appear until the end of the seventh day. When is the delay for purposes of determining concurrency? FSAPG 29R-03 does not identify a preferred method in this situation, but this author believes that it is generally best to measure concurrency at the point the delay is manifested on the critical pathat the end of the seventh day in the example above. The alternative would be to investigate the timing of each of the causative elements associated with the alleged delays. This is often impossible. FSAPG 29R-03 also identifies that such an investigation may be impacted by the placement of measuring periods since the causative events may occur long before the delay appears. The best solution is to recognize there is no actual delay at an activity level until the activity fails to complete on time; however, a detailed examination is still required to look at the causes of the delays since they affect the consideration of pacing and voluntariness. Regarding the third issue, FSAPG 29R-03, Subsection 4.2.D.2 has an extensive discussion of the fundamental issue of least float or negative float as it relates to criticality. The negative float theory assumes criticality of any activity that has negative total float relative to a contractual milestone. The negative float approach has a certain advantage in that contractors often manage activities with negative float more closely and recovery of these activities is essential to the recovery of project delay. The lowest float path theory provides for criticality on the longest path only, even if other secondary paths are late with regard to a contractual milestone. Under this theory, all paths shorter than the longest path (even those with negative total float) have positive total float with respect to the longest path and are therefore non-critical. The issue is so fundamental that FSAPG 29R-03 identifies it as an essential consideration in five of its nine delay analysis methodologies [1]. The difference between these two theories has a significant impact on determining concurrency. Under the negative float theory, any activities with negative float occurring during the measurement period are potential candidates for concurrency. This theory supports the application of offsetting delays since any delay to negative activities would be a critical path delay. FSAPG 29R-03 identifies that most schedule delay analysts and FSAPG 29R03 itself generally follows lowest float path theory. This theory reduces the potential application of offsetting delays.

Same Time Period

Perhaps the most controversial and at the same time most important new concept relating to concurrency in FSAPG 29R-03 are the conflicting approaches of Functional v. Literal Concurrency. Simply put, it asks how far apart in time can would-be concurrent delays be? This concept and terminology was developed in FSAPG 29R-03 (2007) and while it had never been separately identified as an element of concurrency, it has often been an underlying issue in court cases [14]. Under the Functional approach, the delays must occur in the same analysis measurement period. This means that a delay by the owner in the beginning of

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Figure 6 Comparison of Two Delays and Two Different Measurement Periods the measurement period can be concurrent with a delay by the contractor in the end of the measurement period, see figure 4. Under the Literal approach the concurrent events must start at the same time, but need not be of identical duration. If one of the delay events starts prior to the other event, the first event creates float in the second event preventing it from being on the critical path [18]. While perfect simultaneity is impossible, they cannot start at exactly the same time, FSAPG 29R-03 recognizes the measurement period for most schedules is a day, so the alleged delays must start on the same day. If the measurement period was an hour, as it is in shut-down or outage projects, or a week, as might occur in certain planning projects, the same rule applies, see figure 5. The differences between these two opposing approaches are far-reaching. The Functional approach is closely aligned with an evaluation period that often coincides with schedule updates by the contractor. Since most construction schedules are updated or intended to be updated monthly, the approach holds that if the two delays occur in the same period and other seven criteria identified above are met, there is concurrency. This approach reflects the reality of the monthly update, as well as the inherent unreliability in attempting to measure events too precisely. Despite best efforts, records from the field are often incomplete and do not measure events or progress with daily accuracy. In most cases, the Functional approach will generate more days of concurrent delay because the time period (generally a month) is relatively large. Under the Functional approach a delay in the first two weeks of a monthly measurement period is concurrent with a two week delay at the end of that same period, assuming the other concurrency criterion are met. But the Functional approach also has its disadvantages. The location of the start and end of the measurement period used in the analysis has a significant impact on the determination of concurrency. If the dividing line between measurement periods falls between the two delays, there is no concurrency. Figure 6 shows the implications of the placement of the measurement period and the alleged delays. In Scenario 1, the two delays fall in the same measurement period, resulting in concurrent delays. In Scenario 2, the delays, otherwise identical to the previous one, fall in different measurement periods with the result of them not being concurrent. Offsetting concurrent delays, as we will return to in a few paragraphs, always occur within the same measurement period, but a measurement period of that can be as long as the entire project. The Literal approach also has advantages and disadvantages. It assumes that both planned and actual activity measurement is accurate to within one day. As previously mentioned, this is often not the case. Yet, typical CPM schedules are developed, monitored, and updated with a planned accuracy of a day, so it is not unreasonable to measure to that accuracy. Further, in order to establish the basic seven elements of concurrency, the analyst usually investigates the events surrounding the alleged delays in detail, on a day-to-day basis, so as to establish the first three criteria. Once this evaluation has been made, it seems absurd to then disregard this detail in characterizing non-simultaneous delays as concurrent.

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Figure 7 Offsetting Concurrent Delays Along a Single Critical Path FSAPG 29R-03 takes no position on whether the Functional or Literal approach is preferred. As discussed below, the Functional approach appears to be more widely accepted in court decisions, but at least one expert treatise published subsequent to the FSAPG 29R03 seems to support the Literal approach [23]. critical path. For example, assume the owner delays Building A commencement by one month. Later, the contractor delays work on Building A for a month. Since both delays are on the same critical path they might be considered concurrent under a global view of concurrency. However, the overall delay to building A is now two months, with each party responsible for one month. This appears to be a sequential nonconcurrent delay. It is unclear from any reported cases whether this would be considered concurrent, see figure 7. These cases finding sequential concurrent delay seem to generally be older cases (some dating to the 1930s) where the factual presentations were insufficient to allow apportionment of the delays between the parties [14]. They do not distinguish between cocritical and single critical paths. One hopes that with modern CPM analysis better prepared cases result in these offsetting delay decisions no longer being valid. The second viewpoint in reported cases discounts the global view of concurrency, thus preventing findings of concurrent offsetting delays [5]. Yet, these cases do not distinguish between literal and functional concurrency, either implicitly or explicitly. In these cases, the courts rely on the following two overlapping approaches to reach their decisions. In the first approach, they apportion delay responsibility based on the facts and delay analysis presented [20]. Such an allocation, if sufficient, permits a day-by-day allocation of responsibility. The courts have found that since the contractor is generally attempting to prove the delay, it must generally prove apportionment between the owner and contractor, and failure to establish apportionment will result in a finding against the contractor [24]. The second and more successful approach is to strictly construe the critical path. Such a perspective, given sufficient detail, will lead to the literal approach of concurrency. Recall that under the literal approach, the critical path delay that starts first creates float in

Concurrent Delay is a Legal Theory

There are two conflicting viewpoints in court decisions regarding the time relationship between two delay events [5]. The first viewpoint adopts a global view of concurrency, one that is consistent with offsetting concurrent delays. These decisions find sequential delays along the critical path, even those that are widely separated in time, are concurrent [7]. These delays that occur along different co-critical paths in a sequential manner are concurrent because each would have delayed completion absent the other. The rational for this finding is that the effect of either individual delay is the same as the combined effect of both delays as shown in figure 1. A more complicated situation however occurs when the two sequential delays occur along the same

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the remainder of the schedule. In Santa Fe, Inc. [21], the board stated: [I]f the [governments] concurrent delays affected only work that was not on the critical path they are not delays within the meaning of the [concurrency] rule This strict approach has been followed in other cases, but only when there is sufficient evidence to support such an analysis [17].

3.

Are Offsetting Delays Concurrent Delays?

So now we know that owners can argue that time-separated delays can be concurrently offsetting delays because according to some judicial decisions, sequential delays along the critical path can be considered concurrent [11]. Owners generally posit this situation in negotiations because owners often have poor schedule control policies, or worse have affirmative policies that leaves determinations of delay quantification and entitlement until the end of the project. Recall in our initial discussion, the owner attempted to offset a delay in site access with a subsequent contractor delay. This attempt often occurs because the owner fails to resolve delays as they occur. The most common reasons are: 1. The owner, through poor management practices, simply fails to act on a contractors delay request. Such failures generally result in increased costs of resolution because contractors increase their pending change order claims to cover the increased delay and, constructive acceleration becomes more likely since the contractor has not been granted a contemporaneous time extension, yet is required to continue to make progress. The owner can consciously adopt a wait and see attitude concerning delays. This is usually done with the hope that the possible delay claim will evaporate through contractor

resequencing, uncompensated acceleration or later contractor delays. This procedure incurs the same increased cost and constructive acceleration risks described above. The owner can have an active policy of deciding all delay issues at the end of the project. Owners often implement this policy under the misguided idea that it is cheaper to pay the premium for late issuance of a time extension rather than potentially pay for undeserved time. Undeserved time occurs when contractors are contemporaneously given time extensions, only to have afterthe fact analysis show such a time extension was undeserved.

In all these situations, the owner arrives at the end of the project without having contemporaneously resolved requested time extensions. The recourse often is a discussion of offsetting delay.

appears from observation, based on the rarity of actual payment of liquidated damages, that contractors are often successful in eliminating liquidated damages from owner claims. This can be considered a partial success. Second, after the initial effort at proof of delay, the contractor may recognize that the best resolution would be a finding of offsetting concurrency in lieu of winning on the owners initial delay and losing on the subsequent delay. Part of this evaluation will be purely financial; that is, balancing the delay damages against the owners liquidated damages [2]. The result is neither party gets damages although a time extension is granted. Finally, many times contractors simply yield to the superior bargaining position of owners on this issue of offsetting delay. Contractors compare the costs and risks of litigation with the potential recovery, and conclude the cost of litigating construction issues usually outweighs potential recovery. Thus owners continue to assert their questionable entitlement to offsetting concurrent delays.

Negotiating Offsetting Delays

While the contractor should always follow the contract procedure and press for timely resolution of delay issues, the contractor needs to be prepared in the event there is an end-of-project balancing effort by the owner. Contractors have three major positions they can take in negotiating offsetting delays: (1) they can fight the alleged offsetting concurrency by establishing they were not responsible for the second delay; (2) they can encourage and welcome such a negotiation; or, (3) they can yield to the owners superior bargaining position and accept the offsetting delay. In many cases, contractors will follow all three alternatives sequentially. The first reaction is almost always to prove the initial ownercaused delay and then go on to prove that all subsequent delays were not the contractors responsibility. This is, of course, what schedule delay experts working for contractors typically attempt. It is seldom fully successful, but almost always partially successful. It

The Future of Offsetting Delays

ike CPM scheduling itself, the experts and industry are significantly more advanced in concurrency analysis than the courts. While there still exists a series of decisions that make concurrency decisions on a global basis, resulting in sequential delays being deemed concurrent, better understanding of concurrent delay by the experts, better CPM schedules maintained during projects, improved record keeping, and better forensic CPM delay analyses, all portend that offsetting concurrent delays will be a thing of the past.

REFERENCES
1. AACE International Recommended Practice 29R-03 (2011) Forensic Schedule Analysis Practice Guide, Subsection 4.2, AACE International, Morgantown, WV. Bidgood, J., S. Reed, and J. Taylor, Cutting the Knot on Concurrent Delay, Construction Briefings, February 2008.

2.

2.

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3.

4.

5.

6.

7.

8.

9.

10.

11.

12. 13.

14.

Blinderman Construction Co. Inc. v. U.S., 39 Fed. Cl. 529 (1997), UtleyJames, Inc., GSBCA No. 5370, 85-1 BCA 17816, 1984. Bramble, B. and M. Callahan, Construction Delay Claims, 1.01 (3d ed. Supp 2010), Aspen Publishers, New York, 2000 Brasco, C. and C. Anzidei, Concurrent Delay and the Critical Path: Views from the Bench, Cost Engineering journal, AACE International, Morgantown, WV, February 2010. Bruner, P. and J. OConnor, Bruner & OConnor Construction Law, Vol. 5, Section 15.67, 15.68, and 15.70, West Thompson Reuters, New York, 2007 Coffey Construction Company, Inc., VABCA No. 3361, 93-2 BCA 25788 (1993); Raymond Constructors of Africa, Ltd. v. U.S., 411 F.2d 1227, (Ct. Cl. 1969). But see, Dale, S. and R. DOnofrio, Reconciling Concurrency in Schedule Delay and Construction Acceleration, (2010) 39 Public Cont. L.J. 161. See also, Arniz Construction, et.al., EBCA No.18712-81, 84-3 BCA 17604 (1984) and Gulf Contracting, Inc., ASBCA No. 30195 89-2 BCA 22814 (1989). Essex Electro Engineers, Inc. v. Danzig, 224 F.3rd 1283 (Fed. Cir. 2000). It should be noted that some contracts do not allow concurrent delaysthey convert concurrent delays into contractor delays, see T. Trauner, W. Maginelli, S. Lowe, M. Nagata, and B. Furniss, Construction Delays, 2nd Edition, Elsevier Inc., London, page 31, 2009. Fink, M., The Burden of Proof in Government Contract Schedule Delay Claims, 22 Public Cont. L.J.125, 1992. Fishbach & Moore International Corp., ASBCA No. 18146, 77-1 BCA 12300, 1977. G.M. Sharp, Inc. v. U.S., 5 Cl. Ct. 662, 1984. John Driggs Co., ENGBCA Nos. 4926, 5061, and 5081, 87-2 BCA 19833, 1987. Kirk Bros. Mechanical Contractors, Inc., ASBCA No. 40172, 92-3-BCA 25144, 1992.

15. Kutin, P and A. Ness, Concurrent Delay: The Challenge to Unravel Competing Causes of Delay, 17 Construction Law 18, October 1997. 16. MCI Contractors, Inc., DCCAB No924 (1996); Utley-James, Inc., GSBCA No. 5370, 85-1 BCA 17816 (1984); Santa Fe, Inc., VABCA No. 1943, 84-2 BCA 17341, (1984); Blackhawk Heating and Plumbing Co., GSCA No 2431, 75-1 BCA 11161, (1975). 17. But see, Mega Construction Co. v. U.S., 29 Fed. Cl. 396, (1993) (The court rejected concurrency saying that there could not be co-critical paths). 18. Ostrowski, V. and M. Midgette, Concurrent Delay Analysis in Litigation, Cost Engineering, Morgantown, WV, January 2006. 19. Oxford English Dictionary, 1971, Oxford University Press, London, Definition 2: Acting in conjunction, cooperating, contributing to the same effect.

20. PCL Construction Services, Inc. v. U.S., 53 Fed. Cl. 479 (2002); J. A. Jones Construction Co. 97-1BCA 28918, 1997. 21. Santa Fe, Inc., VABCA No. 1943, 84-2 BCA 17341, 1984. 22. Sterling Millwrights, Inc. v. U.S., 26 Cl. Ct. 49, 1977. 23. Trauner, T., W. Maginelli, S. Lowe, M. Nagata, and B. Furniss, Construction Delays, 2nd Edition, Elsevier Inc., London, page 31, 2009. 24. Young Entertainment of Ga. v. GSA, GSBCA No. 14437, 00-2 BCA 31148, (2000).

ABOUT THE AUTHOR

John C. Livengood, CFCC PSP is with ARCADIS. He can be contacted by sending e-mail to: john.livengood@arcadis-us.com.

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TECHNICAL ARTICLE

FORENSIC SCHEDULE ANALYSIS:

EXAMPLE IMPLEMENTATION PART II
Mark C. Sanders, PE CCE PSP

Abstract: Recommended Practice R - Forensic Schedule Analysis, has aroused significant debate in the forensic scheduling community since its original publication in 2007. Now in its second revision, the RP continues to evolve in pursuit of the original goal of providing a unifying technical reference for the forensic application of the critical path method of scheduling. During the development of the original RP, there was a proposal to include example analysis implementations, in so-called cookbook sections. The material developed for two of those sections was presented in 2008, in a paper detailing the forensic analysis of a sample project using Method Implementation Protocols 3.3 and 3.7. This article presents an analysis of the same project using MIPs 3.1, 3.2, and 3.8; presents a comparison of the results from all five analyses; and provides additional discussion of issues likely to be encountered in an actual implementation of the guidelines in the recommended practice. This was manuscript CDR.493 at the 2011 Annual Meeting. Key Words: Delay, forensic schedule analysis, critical path, and scheduling his article is the second in a series that presents a Forensic Schedule Analysis (FSA) example implementation, prepared to address the application of procedures described in Recommended Practice R Forensic Schedule Analysis [1]. The techniques explored here, or variations on these techniques, have been commonly referred to as AsPlanned v. As-Built, As-Planned v. Update, and Collapsed As-Built. Those terms are not used here, in preference for the taxonomic terms presented in the RP 29R-03. This article presents three separate analyses of the same project. The analyses are based on the Method Implementation Protocols in Sections 3.1, 3.2, and 3.8 of the Recommended

Model Project to be Analyzed

The sample project referenced in this article is the same project used in the example implementation for MIPs 3.3 and 3.7, presented in 2008 [2]. The description of the sample project presented in that article is reiterated here for reference. The original sample project was provided for the consideration of the participants in the RP development committee and had been used previously for the comparison of various delay analysis techniques [3]. The model project is the construction of a storage building. The building will be used to store non-hazardous, dry materials. The design consists of tilt-up concrete panels with a steel-framed, metal roof. A much smaller receiving and reception area is attached. The reception area is framed with metal studs and enclosed with an exterior-insulating and finishing system (EIFS). Personnel arrive through the reception area and goods are delivered by truck to the all-weather docking unit in that area. The available information for the project includes a baseline schedule, six schedule updates, and a summary of project events based on the contractors and owners files.

Practice. The article has the following five major sections: Model project to be analyzed. Analysis by comparing the asplanned and as-built schedules (observational/static/gross analysis per MIP 3.1). Analysis by comparing the asplanned and as-built schedules on a periodic basis. ( o b s e r vat i o n a l /stat i c / p e r i o d i c analysis per MIP 3.2). Analysis by removing delay events from the as-built schedule. (modeled/subtractive singlesimulation analysis per MIP 3.8). And, Figure 1 depicts the as-planned Comparison, commentary, and schedule as a bar chart, and figure 2 conclusion. shows the logic diagram. In the example

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Figure 1 Baseline Schedule

Figure 2 Schedule Logic Diagram

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Figure 3 As-Built Schedule project schedule, the project start milestone has start-to-start relationships with its successors, and the punchlist activity has a finish-to-finish relationship with the project finish milestone. All other relationships are finish-to-start, and there are no lags. Durations are in weeks, and the project is planned to take 16 weeks to complete. The baseline critical path begins with project start and proceeds through excavation, foundation, tilt-up joining wall, remaining tilt-up walls, beams and roofing, install racking, punchlist, and project finish. There are no constraints in the schedule. The following logic diagram details the relationships in the baseline schedule. Figure 3 shows the as-built schedule for the same project. The project actually took 24 weeks to complete, as shown in figure 3. Relevant information from the project records is summarized in table 1, outlining the events that occurred during the project. The summary of project information will be used in conjunction with the project schedules. The goal of the schedule analysis will be to identify the specific activity delays that resulted in the overall eight-week delay to project completion. Including the as-built schedule, there were six updates to the baseline schedule. The updates were completed after every four weeks of work. occurred and the outcome is known. The analysis is observational because no activities are added or subtracted from the schedule to model delays or changes to the plan; the progress from the asbuilt schedule is simply compared to the original as-planned schedule. The analysis is static because the critical path of the as-planned schedule is used as the basis for identifying critical delays throughout the project. The analysis is gross because the as-built schedule is compared directly to the as-planned schedule. Interim updates are not analyzed as these reflect only a subset of the information that is ultimately captured in the final as-built schedule. According to the RP, MIP 3.1 recommends the implementation of the Source Validation Protocols (SVPs) as follow: SVP 2.1 (baseline validation); SVP 2.2 (as-built validation) or SVP 2.3 (update validation); and SVP 2.4 (delay identification and quantification). There

Analysis by Comparing the AsPlanned and As-Built Schedules Observational/Static/Gross Analysis per MIP 3.1
This analysis will be performed based on the method implementation protocol (MIP) described in Section 3.1 of the RP. The analysis is classified as retrospective because the analysis is performed after the delay events and the impacts of those events have

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Table 1 Summary of Project Information are no additional SVPs recommended for an enhanced implementation. Other recommendations from the RP include: (1) recognize all contract time extensions granted, (2) identify the critical path activity that will be used to track the loss or gain of time for the overall network, and (3) separately identify activities that will be used to track intra-network time losses and gains, such as on interim milestones. For the purpose of this example implementation, all of the information sources have been evaluated based on the SVPs and deemed to be reliable sources of project information for the analysis. There have been no contract time extensions granted. The activity

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Table 1 Summary of Project Information (Continued)

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Table 1 Summary of Project Information (Continued)

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Table 1 Summary of Project Information (Continued) that will be used to track delays to the overall network will be Activity M990. There are no intermediate milestones on the project [2]. The analysis begins with a direct comparison of the as-planned and asbuilt schedules. Figure 4 shows an activity-by-activity comparison of the data from the two schedules. Figure 4 includes the raw data from the as-planned and as-built schedules. The original durations shown are the same, as they would be in the schedule files. The remaining durations are the same as the original durations in the as-planned schedule, and are all zero in the as-built schedule. As the relevant information for the purpose of this analysis can be read directly from the bar chart on the right side of the figure, the columns on the left side will not be included in further figures. The planned and actual dates and durations can be observed on the bar chart. Using this information, the analyst might begin to identify and quantify delays from figure 4. SVP 2.4 recommends identifying activity-level variances (ALVs). These variances can be identified by comparing the planned and actual dates for all activities. The variances are summarized in table 2. The information in table 2 shows the extent to which each activity in the schedule started late and finished late.

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Figure 4 As-Planned v. As-Built By comparing those variances, it also shows the extent to which each activitys duration exceeded its original duration. In the case of the remaining tilt-up walls and reception roof, the activities actually took less time than planned. The information in table 2 is useful but not conclusive, because variances are cumulative as the project progresses. In addition, table 2 does not indicate whether the delays noted were critical. Further investigation is required. Based on the project records, there were delays associated with an underground storage tank that impacted excavation; delivery of the docking unit; and design issues that affected roof joists and panels. At one point, the contractor also noted that selection of the racking system was becoming critical, but selection did not appear to delay procurement, based on the project records. In any case, install racking was on the critical path in the as-planned schedule, and its finish was delayed by eight weeks, so the analysis will begin there. Figure 5 is an initial attempt to associate the overall eight-week project delay with the individual activity delays shown in table 2. By initial inspection, it is clear that there was a total eight-week delay to the completion of install racking. Racking installation started six weeks later than originally planned, and its duration was two weeks longer than

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Table 2 Activity-Level Variances for MIP 3.1 planned. These appear to be critical delays, because of the fact that install racking was on the critical path in the asplanned schedule, and it was driving the start of punchlist, which was driving project finish, in the as-built schedule. The project documentation discusses the fact that racking installation was proceeding from weeks 19 through 23, which was two weeks longer than planned. The documentation also indicates that the owner had an electrical contractor working during weeks 21 and 22, and that racking installation was suspended during that period. Predecessor activities will be investigated to determine what caused the delay to the start of install racking. As can be seen from the activity level variances in table 2, beams and roofing was delayed by six weeks, and it was a predecessor to install racking. In addition, we can see that there was a three-week delay to excavation at the start of the project. Those delays are plotted on the project schedule in the next step of the analysis. Based on the project records, there was a delay to excavation because of a UST that was found within the building footprint. In addition, there was a delay to the beams and roofing because of a

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dimensional discrepancy between the structural and architectural drawings. These delays are plotted on the asplanned v. as-built comparison in figure 6. A portion of the roofing delay overlaps with the racking delay noted previously. As the roofing delay occurred first, the overlapping portion of the racking delay is marked as concurrent, as the delays appear to be concurrent in figure 6. Figure 6 now shows a total of 14 weeks of non-concurrent delay, and the actual project was only delayed by eight weeks. Some simple presentations might stop here, having identified at least enough delay to explain the total project delay. If a presentation is to be made on behalf of the contractor, as part of a request for waiver of liquidated damages, it might include the following statements: We were delayed by three weeks because of unforeseen underground conditions associated with the UST. We were delayed by an additional six weeks because of a dimensional design error between the structural and architectural drawings. We started the racking later than planned; therefore, we were not able to complete it prior to the mobilization of the owners electrical contractor. Racking installation had to be suspended for two weeks during that contractors work. We are due a time extension of at least 11 weeks, so we should not be assessed liquidated damages for finishing eight weeks late.

techniques outlined in MIP 3.1the analysis will continue. As we have identified the major delays of interest, the sub-critical activities that have not been associated with project delays at this point are removed from the figures for simplicity. Figure 7 shows that the entire sixweek delay to install racking could be associated with the late finish of beams and roofing. This leaves a two-week

delay associated with the extended duration of install racking, and eliminates the concurrent delay noted in figure 6. As can be seen in figure 7, beams and roofing and install racking were planned sequentially and actually proceeded sequentially. They were not concurrent activities, and there was no concurrent delay. Instead, the delays were sequential. Still, figure 7 shows a total of 11 weeks of delay. As the overall

Depending on the owner, this presentation might be sufficient to obtain a release from liquidated damages. However, some owners might require a more detailed analysis. Certainly, if a presentation is to be made before an arbitration panel or in a courtroom, the contractor would likely want to have a much more thorough presentation. If presented as an expert opinion, a presentation such as the preceding one runs the risk of being dismissed entirely for not meeting the standards for expert testimony. Therefore, in an attempt to add more detailwhile staying within the analysis

Figure 5 As-Planned v. As-Built With Annotated Delays (Version 1, Draft)

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project was only delayed by eight weeks, further investigation is required to resolve the discrepancy. Figure 8 recognizes the fact that the delay to excavation was recovered by week 9, and the remaining tilt-up walls activity was completed in the same week as originally planned. The three-week recovery is shown to highlight that fact. Subsequently, the project experienced a six-week delay to the start of Beams and roofing and a two-week delay because of the extended duration of Install Racking. This figure will be used in the final presentation of the analysis. The total project delay is determined to include the following: Three-week delay to excavation Three-week savings to remaining tilt-up walls Six-week delay to beams and roofing Two-week delay to install racking

will proceed based on the critical path from the as-planned schedule. There is an inherent assumption that the parties had an agreed-upon plan with which to execute the work, and the contractor based its pricing and performance on that plan. The contractor prepared the plan; the owner reviewed it, provided

comments, and ultimately approved it. Both the contractor and owner agreed that the critical path shown in the plan was the critical path of the project. MIP 3.2 recommends the implementation of the same SVPs as MIP 3.1. Again, for the purpose of this analysis, assume that all of the source

Analysis by Comparing the AsPlanned and As-Built Schedules on a Periodic Basis Obser vational/Static/Periodic Analysis per MIP 3.2
This analysis will be performed based on the method implementation protocol (MIP) described in Section 3.2 of the RP. The analysis is classified as retrospective because the analysis is performed after the delay events and the impacts of those events have occurred and the outcome is known. The analysis is observational because no activities are added or subtracted from the schedule to model delays or changes to the plan; the progress from the asbuilt schedule is simply compared to the original as-planned schedule. The analysis is static because the critical path of the as-planned schedule is used as the basis for identifying critical delays throughout the project. The analysis is periodic because the progress in each schedule update is compared sequentially to the as-planned schedule, and delays are identified during each update period. It is notable that MIP 3.2 is still considered a static analysis technique, even though the updates will be used in the analysis. This is because the analysis Figure 6As-Planned v. As-Built With Annotated (Version 2, Draft)

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documentation provided has been reviewed and determined to be valid. The analysis begins with a comparison of the as-planned schedule to the first update, as shown in figure 9. In reviewing each period, the analyst can identify any ALVs that occur during the period. Those values are tabulated on the right side of figure 9. Values determined in this step of the analysis are highlighted in yellow in the table. During the first period, the project

start milestone occurred, and excavation began. The milestone began as planned, so the ALVs is zero. Duration variances are not applicable to milestone activities, and are marked N/A on the right side of figure 9. Excavation began as planned, and its actual start date is reported on the right side of figure 9. The start variance is reported as zero. Excavation had a planned duration of two weeks, and it had an actual duration of four weeks by

the end of the period. Therefore, its duration variance for the period is reported as two weeks. The activity was incomplete at the end of the period, so its total duration variance is to be determined and is marked TBD in the table. No other activities made progress during the period analyzed in figure 9. In the second period, excavation is finished, and the foundation and tilt-up joining wall activities both started and finished. Figure 10 shows the as-built

Figure 7As-Planned v. As-Built With Annotated Delays (Version 3, Draft)

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schedule for the completed excavation activity and the two additional activities. The associated ALVs are tabulated on the right. There is an additional oneweek delay in this period associated with the extended duration of excavation. Its original planned duration was two weeks. That duration had already been overrun by two weeks in period 1. The additional one week in period 2 brings the cumulative duration variance to a total of three weeks. This appears to be

the same three weeks associated with the start and finish variances on the foundation and tilt-up joining wall activities. Figure 11 shows the three weeks of recovery achieved by completing the remaining tilt-up walls more quickly than originally planned. Comparing the asplanned critical path to the as-built path in the storehouse, the analyst can see that the critical path is back on schedule by the end of week 9. Work has also

started in the reception area, which was not on the critical path in the baseline schedule. The project records indicated that there was some concern regarding the fabrication of the docking unit, but they also indicated that the contractor was working with the supplier to expedite delivery. In any event, the project is not ready for the docking unit. More importantly, the critical beams and roofing activity did not begin immediately after the finish of remaining

Figure 8As-Planned v. As-Built With Annotated Delays (Version 4, Final)

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Figure 9As-Planned v. Update 1 Progress With ALVs for Period

Figure 10As-Planned v. Update 2 Progress With ALVs for Period

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tilt-up walls. The magnitude of the delay associated with the start of roofing will be assessed in the next period, when work on that activity begins. Figure 12 shows the analysis of the fourth period. The start of beams and roofing was delayed six weeks, and this appears to be a critical path delay. Meanwhile, progress in reception continued, and delivery of the docking unit appears to be imminent. Based on the project records, the dimensional issues that caused the delay to beams and roofing have been resolved through modifications to the roof structure and panels, and installation of the roof system began in week 16, as shown. Figure 13 shows that the beams and roofing activity was completed within its planned duration. Meanwhile, work in reception continued, and the roof in that area was completed in one week less than its planned duration. The docking unit was delivered, and installation is under way. Installation has overrun its duration by one week, but that week appears to have been mitigated by the

better-than-planned progress on roofing. Both areas of the project are complete except for install racking, install docking unit, and punchlist. The project is already four weeks past its planned completion date. Based on project documentation, the project is expected to finish in another two weeks. As shown in figure 14, it actually took four weeks to complete the project, instead of two as forecast in the project documentation available from week 20 (and the schedule update from week 20.) The additional two weeks of delay appear to be because of the extended duration of the install racking and install docking unit activities, concurrently. Both activities were completed in week 23. Then Punchlist work was completed within its planned one week duration, and the project was completed in week 24. All periods have now been analyzed; the ALV table has been fully populated; all available project documentation has been reviewed; and the analyst is now ready to summarize the results of the analysis.

The completed ALV table created in MIP 3.2 consolidates the variances identified in all periods. In fact, it is identical to the ALV table created for MIP 3.1. It was simply populated through a step-by-step process in MIP 3.2. With the project records and the analysis of each period, initial conclusions can be presented as to the delays that occurred during each period. For example: Period 1Critical excavation began, but progress was delayed by two weeks because of unforeseen underground site conditions associated with the removal and remediation of a UST. Period 2Critical excavation was delayed by one additional week; critical foundation and tilt-up joining wall activities were delayed by the extended duration of excavation, but once they started, they were completed with no additional delay. Period 3Critical remaining tilt-up walls were expedited to recover the prior delay. Reception walls were

Figure 11As-Planned v. Update 3 Progress With ALVs for Period

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also proceeding. Critical beams and roofing did not begin as planned. No critical path work was performed during the last two weeks of the period. However, work in the reception area proceeded. Period 4The delay to critical beams and roofing because of dimensional errors continued until week 16. As that work should have started in week 10, this was a total six-week delay by the end of period 4. Work in the Reception area continued. Period 5Beams and roofing work was completed within its planned duration. Final details regarding the racking system were resolved with the owner in the same week that roof work was completed, so that racking installation could proceed the following week. The reception area was completed, except for the docking unit. Period 6Install racking took two weeks longer than originally

planned, and install docking unit took four weeks longer than originally planned. Those were the last two activities to be completed prior to punchlist. They were both completed in week 23, but the extended durations caused an additional two weeks of delay. While install docking unit was not on the as-planned critical path, everything was critical at this point, because the project should have been completed in week 16. Therefore, the delays associated with the racking system and docking unit were considered to be concurrent. In fact, a review of the project documentation shows that both activities were delayed by electrical work, which was performed by another contractor. Once they were completed, punchlist was completed as planned, and the project was completed in week 24.

Some analysts might disagree with some of these statements based on critical path concepts. They might argue that there is nothing in the analysis that justifies the determination of which activities are critical. In fact, they might argue that the analysis does not take into account the dynamic nature of the critical path, even though it is divided into periods and presented in a manner that might be called a windows analysis by some practitioners. It is true that the analysis does not take the dynamic nature of the critical path into account. It is a static analysis, based on the concept presented at the beginning of this sectionthe owner and contractor had an understanding as to what was critical on the project, and they documented that understanding at the beginning of the project through their development, review, and agreement on the project schedule. One party might argue that the analysis did not address significant delays to some activities in reception;

Figure 12As-Planned v. Update 4 Progress With ALVs for Period

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and the other party might argue that the reception work was never critical, and could have been expedited if it had become critical. If this analysis were to be presented in a legal forum, the analyst would likely want to consult with counsel as to whether there exists precedent that requires an analyst to recognize the critical path as dynamic in an analysis such as this one. However, in a forum where a contract time extension is to be negotiated (as opposed to litigated), this analysis may be compelling if presented by persons knowledgeable of the events that occurred during each period of the project. Another criticism of this analysis might be based on the fact that the remaining work from the as-planned schedule should be pushed to the right

as each periodic analysis begins. From one perspective, it is confusing to compare the as-built schedule to the original as-planned schedule once delays have occurred. Rescheduling incomplete work at the end of each period would classify this as a dynamic analysis, and critical path shifts would need to be considered each time the remaining work is rescheduled. That technique is covered under MIP 3.3 in the RP, and an analysis of this project using the technique was presented in 2008 [2].

Analysis by Removing Delay Events from the As-Built Schedule Modeled/Subtractive SingleSimulation Analysis per MIP 3.8

This analysis will be performed based on the method implementation protocol (MIP) described in Section 3.8 of the RP. The analysis is classified as retrospective because the analysis is performed after the delay events and the impacts of those events have occurred and the outcome is known. The analysis is modeled because activities modeling the delay events are inserted into the as-built schedule. Then they are subtracted to collapse the as-built schedule. The analysis is a singlesimulation because the delays are extracted in one periodbetween the as-planned and as-built schedules. Although the delays may be extracted in a particular order, no specific effort is made to divide the analysis into periods or reproduce the status of the project as

Figure 12As-Planned v. Update 4 Progress With ALVs for Period

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it was shown in the intermediate updates. MIP 3.8 recommends the implementation of SVPs 2.2 (as-built validation) and 2.4 (delay ID and quantification). For the purpose of the analysis, the as-built has been validated. Delays will be identified and quantified in the initial steps of the analysis. MIP 3.8 states that SVPs 2.1 (baseline validation) and 2.3 (update validation) can be performed in an enhanced implementation. Similar to the other MIPs covered for this example, assume that all data sources have been validated and deemed to be reliable. After listing the relevant SVPs, MIP 3.8 lists a series of six points under the heading Recommended Implementation Protocols and three more points under Enhanced

Implementation Protocols. All of these points were taken into consideration in performing the example analysis. One point was determined not to be relevant to the example. Namely, no calendar was incorporated into the as-built schedule to model actual weather conditions. For the purpose of the analysis, weather conditions have been determined to be normal and had no impact on the project during its 24-week duration. The analysis begins with the as-built schedule shown in figure 3. Network fragments (fragnets) are then created to model each of the delaying events on the project, and these fragnets are inserted into the as-built schedule and logically tied so that the delay activities are linked to the activities that they affected. Based on a review of the project documents, the delays are

identified and the fragnets created. The fragnets are similar to those that were used in the presentation of MIP 3.7 in 2008 [2]. One key difference is that all activities in the fragnets in MIP 3.8 are added to the schedule in the as-built condition. Another key difference is that the durations have been extended in some cases (as compared to the fragnets used in MIP 3.7) to facilitate collapsing the schedule. Delay ADiscovery of UST (differing site condition), testing, removal, and mitigation Excavation began as planned in week 1. However, at the end of the week, an underground storage was discovered in the building footprint. Excavation proceeded, but was suspended in the area of the storage tank. One week was spent testing the surrounding soil for contamination and

Figure 14As-Planned v. As-Built Progress With ALVs for Period

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Table 3Completed Activity-Level Variance Table for MIP 3.2 developing appropriate remediation efforts. Then, two weeks were spent removing the UST and contaminated soil before completing excavation activities. Fragnet A was developed to model the work associated with the UST, as shown in figure 15. Activities that are added are highlighted in the figures (light blue). The other activities shown in the fragnet graphics are included to show logical ties between the fragnet activities and existing schedule activities. That information is noted in the Successors column. Delay BDocking unit supplier delayFabrication of the docking unit was initially scheduled to begin in week 1. Based on review of project documentation, the contractors supplier indicated that it would not begin fabricating the docking unit until week 11 because its factory was operating at capacity on other projects. The supplier wrote a letter to the contractor detailing the delay at the start of week 5. Through continued communications with the supplier, the contractor learns that the fabricator actually begins work in week 12. Fragnet B was developed to model the delay, as shown in figure 16. Although the suppliers letter indicated that it would delay the start of fabrication from week

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Figure 15Fragnet A

Figure 16Fragnet B

Figure 17Fragnet C

Figure 18Fragnet D 1 to week 11, the supplier did not actually begin fabrication until week 12. Therefore, the delay is modeled as continuing through week 11. Delay CDrawing dimension discrepancies and field modifications of roof systemBased on project documentation, structural steel arrived on site at the start of week 13. The steel was fabricated in accordance with the contract drawings and the accepted shop drawings. However, when the erected tilt-up panels were surveyed, it was determined that there was an error in the contract drawings that caused numerous roof members and metal roof panels to be fabricated too long. The specifications contain a pre-approved procedure for cutting the steel members in the field. However, the specifications do not allow metal roof panels to be field cut or bent, and the owner will not waive that requirement because it would void the roof warranty. Thus, the panels will be returned to the supplier for modification. The field cutting of structural steel is expected to take one week, but the panel modifications are expected to take four weeks. The panels will be shipped in two partial deliveries in order to minimize the delay. The first half will be returned to the project site at the end of the second week, and the second half will be returned at the end of the fourth week. Fragnet C was developed to model the delay, as shown in figure 17. Delay DInstallation of electrical and inventory systems for racking systemAt the start of week 21, the owner informed the contractor that it had expected general contract work to be complete by now. The owner had scheduled an electrical contractor to install a computerized receiving and inventory system during weeks 21 and 22. The electrical contractor will occupy the majority of the docking area and storehouse during that time. Fragnet D was developed to model the delay, as shown in figure 18.

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Fragnets A through D are added into the as-built schedule, resulting in the model shown in figure 19. Once the fragnets are added to the as-built schedule, the next step is to destatus the schedule so that CPM calculations can be performed. This step is necessary when using many commercial CPM packages because much of the software overwrites or deletes data produced in the network calculation once actual dates have been reported for the activities. While some packages maintain this data, most accounts of MIP 3.8often referred to as a collapsed-as-built analysisemploy

some method of de-statusing the schedule. To de-status the schedule, several steps are taken. The remaining duration of each activity is set to the actual duration, and the data date is moved back to the beginning of week 1. In most cases, the logic of the schedule, including the fragnets, keeps each activity scheduled on the actual dates on which it occurred. However, in a few cases, there is no logical tie that drives an activity to be performed on the dates that it actually occurred. In order to match the as-built dates, some analysts

insert lags. In this case, early start constraints were used to match dates. In addition, a suspension period was introduced into the Excavation activity to show that it could not proceed during the testing and removal of the UST. This was done because the testing began as a successor to the start of excavation, but was concluded as a predecessor to the finish of excavation. Many software packages cannot calculate a network with this type of relationship, as it will be considered a loop. Instead, the excavation activity was shown as suspended. When the delay associated with the testing and UST is removed

Figure 19As-Built Schedule Including Fragnets A Through D

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from the schedule (collapsed), the suspension of the excavation activity will be removed. Suspension periods were also introduced into the install racking and install docking unit activities to better depict the fact that those activities did not proceed during the owners electrical work. It is notable that every activity in the de-statused as-built is critical. It is not uncommon to have many critical activities prior to collapsing an as-built schedule. This is because every gap in the schedule could potentially be filled with some delaying event, even if the event is simply waiting for one party to begin work. The more gaps in the schedule are filled, the more critical activities there will be in the schedule. The schedule for the example project is relatively simple, with only two logic paths. In the as-built schedule, both of those logic paths are on the as-built critical path.

Once the schedule has been destatused, the collapse can proceed. The first delay removed from the schedule is the delay associated with the owners electrical work during weeks 21 and 22. The delay is removed by removing fragnet D and the suspensions on install racking and install docking unit. The result is shown in figure 21. After the removal of the delays associated with the electrical contractor, the completion date of the project changes from week 24 to week 22. This implies that the project would have been completed in week 22, but for that delay. Figure 22 shows the second change in collapsing the as-built schedule. The early-start constraint that maintained the select racking system to be scheduled in week 18 is removed. select racking system falls back to week 1, where it was in the original as-planned schedule. Its float value (highlighted in yellow) has also changed. However,

there is no savings to the project finish date. This implies that no time would have been saved by selecting the racking system sooner, and that the later-thanplanned selection did not cause a project delay. Continuing to work back through the project schedule, the third delay removed is the delay associated with beams and roofing. Removal of the activities for field survey tilt-up walls, field cut structural steel, and modify roof panels allows beams and roofing to be scheduled immediately after the remaining tilt-up walls. In fact, if not for the dimensional issues, the beams and roofing activity was planned to proceed after the tilt-up walls. Although removing the field survey and modification activities results in a six-week savings to the beams and roofing activity and its successor, install racking, there is no overall project savings. Removing the delay does

Figure 20De-Statused As-Built Schedule

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nothing more than create six weeks of float for that group of activities. This is because the excavation and docking unit supplier delay are both driving paths of activities that will still take 22 weeks to complete. The fourth delay removed from the project schedule is the docking unit supplier delay. Removing that delay results in the schedule shown in figure 24. Again, there is no overall project savings as there is still a path of activities that will take 22 weeks to complete. The fifth delay removed from the project schedule is the delay to excavation because of UST removal. The delay activities are removed, along with the suspension period on the excavation activity that was in the model. Removing the UST delay results in a savings of three weeks, and the project completion date moves back to week 19. All delay activities have now been removed from the model, but the schedule still shows a three-week delay, when compared to the original as-

planned schedule. As shown in figure 25, the remaining delay appears to be because of the extended duration of the install docking unit and reception walls activities. Install docking unit overran its duration by two weeks, even once the delay associated with the electrical work was removed. The preceding reception walls activity overran its duration by four weeks. Removing the extended durations results in a schedule that would have completed in 13 weeks, as opposed to the 19 weeks shown in figure 25. That would imply that the extended durations caused six weeks of delay, but the project was scheduled to take 16 weeks in the as-planned schedule. Recalling that the remaining tilt-up walls activity was completed three weeks faster than planned, we can understand the discrepancy. Restoring the duration of remaining tilt-up walls drives the project finish date back to week 16. Therefore, the betterthan-planned progress of Remaining tilt-

up walls appears to have resulted in a three-week savings to the project completion date. Once this last change is made to the as-built schedule, it now matches the as-planned schedule. In fact, it is identical to the as-planned schedule. Fully collapsing an as-built schedule does not always result in a schedule that is identical to the asplanned schedule. However, in this simple case, the analysis has had that result, which might provide a check that the analysis has been completed thoroughly. MIP 3.8 recommends that a constructability analysis be performed on the collapsed as-built schedule. For the example project, it is noted that the logic of the collapsed as-built is the same as the logic of the as-planned schedule. It is also consistent with the manner in which the project was actually constructed, although the as-built durations were longer or shorter than the as-planned durations in some cases. Based on those facts, the collapsed as-

Figure 21Collapsed As-Built With First Delay Removed

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built is deemed to represent a constructable plan. No further constructability analysis is deemed necessary in this instance. Now that the collapse has been completed, the results of the analysis can be summarized. For example, the following conclusions might outline the cause of the eight-week project delay: Two weeks associated with delays to install racking and install docking unit (concurrently) because of the owners electrical contractor Three weeks associated with the delay to excavation because of testing and UST removal Two weeks because of slower-thanplanned progress of install docking unit (prior to the mobilization of the owners electrical contractor) Four weeks because of the slowerthan-planned progress of reception walls These delays total 11 weeks, but there were three weeks of

mitigation because of the betterthan-planned progress of remaining tilt-up walls, resulting in a net total of eight weeks of project delay.

Comparison and Commentary

Three separate analyses have been performed on the example project based on three different Method Implementation Protocols. MIPs 3.1 and 3.2 are similar. They are based on an observational comparison of the asplanned and as-built schedules. MIP 3.8 has a different approach, focusing on modeling delays so that they can be subtracted from the as-built schedule. Table 4 compares the results of the three approaches. Based on MIPs 3.1 and 3.2, the delays surrounding the construction of the storage area structure were found to be the same. Three weeks of delay were associated with excavation; three weeks of savings with remaining tilt-up walls; and six weeks of delay with beams and roofing. However, the two MIPs found

different results for the last two weeks of delay. They were associated with install racking, based on MIP 3.1. They were associated concurrently with install racking and install docking unit, based on MIP 3.2. This is interesting, considering that the analysis approach in MIP 3.2 is essentially a more granular version of the approach in MIP 3.1. Yet, MIP 3.1 found that all delay to the project was associated with the storehouse, while MIP 3.2 found that a small portion of the delay was because of work in reception. MIP 3.8 produced the same results for the early part of the project. The delays found through erection of the remaining tilt-up walls were found to be the same as those identified in MIPs 3.1 and 3.2. However, MIP 3.8 produced significantly different results for the later part of the project. No delay was found to be associated with beams and roofing in the storehouse because of the fact that the reception walls and install docking unit activities in reception took much longer than planned. Four weeks

Figure 22Collapsed As-Built With Second Delay Removed

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Figure 23Collapsed As-Built With Third Delay Removed

Figure 24Collapsed As-Built With Fourth Delay Removed

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Figure 25Collapsed As-Built With Fifth Delay Removed

Figure 26Collapsed As-Built With Extended Durations Removed of delay were associated with reception walls, and two weeks of delay were associated with install docking unit. The final two weeks of delay were found to be concurrently associated with install racking and install docking unit, similar to what was found in MIP 3.2. Table 5 presents a simplified summary of the results of the three analyses by distributing the concurrent delays equally among the associated activities. In other words, the two-week delay that was concurrently associated with install racking and install docking unit was distributed to allocate one week of delay to each activity. This allows for a simpler presentation. However, the summarized values include more than one delay factor in some cases. For example, the summary of MIP 3.8 now shows three weeks of delay associated with install docking unit. However, two of those weeks were associated with the extended duration of the installation before mobilization of the owners electrical contractor, and one of those weeks was associated with the allocated portion of the two-week delay, during which the electrical contractor was working and concurrently delaying the

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Figure 27Collapsed As-Built With Remaining Tilt-Up Walls Duration Restored completion of install racking and install docking unit. The simplified summary in table 5 is not the most convenient way to summarize delays for presentation of a responsibility analysis due to the summarization of independent delays to the same activity. However, it is useful in comparing the results of the multiple analysis techniques in allocating the eight-week project delay to the activities. Table 6 expands on this comparison by including the analyses based on MIPs 3.3 and 3.7, which were presented in 2008 [2]. Table 6 shows the differing conclusions that were reached by applying five different analysis techniques to the same project. Although all techniques found delays whose total correlated with the overall eight-week project delay, no two analysis techniques allocated the delays to the activities in the same way. MIPs 3.1 and 3.2 emphasized the significant delay to the roofing in the storehouse. MIPs 3.3 and 3.7 found that some of the delay

Table 4Summary of Delays From Three Analyses

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Table 5Simplied Summary of Delays From Three Analyses

Table 6Summary of Delays From Five Analyses during that time was associated with the delayed fabrication of the docking unit. MIP 3.8 found no delay associated with the roofing because of the slower-thanplanned progress on the reception walls during that time. The differences in the results of the five analyses highlight the importance affect that the analysis technique can have on the identification of activity delays, especially when delays are occurring on more than one path of activities. As stated in 2008, When there are multiple impacts to a project and many activities are performed later than their original late dates, the partitioning of project delay into the underlying activity delays can be more easily influenced by the analysis technique chosen. . . . The best analyses are those that take advantage of the best sources of project information available and incorporate that information into an objective analysis of the project schedule. In the end, the results of any analysis must be tied to actual project

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events to ensure that the model is a fair reflection of reality [2]. The additional analysis of the example project presented here further highlights the fact that two reasonable analysts are likely to reach somewhat different conclusions if they use different analysis techniques. The debate as to which analysis techniques provide the best answer in the most situations is continuing. It is doubtful that there is any one analysis technique that provides the best answer in every situation. Some of the analysis techniques presented in this article may be disallowed for use in certain forums because of legal precedent. However, they may still be used in a presentation to negotiate a contract time extension. The presentation of the particular analysis techniques in this article is not meant as an endorsement. Rather, it is meant to provide practitioners with the ability to compare the merits and failings of each analysis technique presented in RP29R03, in order to facilitate debate and lead the community of practitioners to consensus regarding best practices in forensic schedule analysis.

AACE International Board Approves

Ask Your Candidates Process for 2012 Election

he AACE International Board of Directors approved a recommendation from the Nominating Committee to create a new program designed to provide more meaningful information regarding the positions of candidates for AACE International board of director positions. Entitled Ask Your Candidates, the program will allow individual members to post a question online to candidates running for board of directors position until Dec. 31, 2011. After that deadline, the Nominating Committee will review the submitted questions and then post, in a Discussion Forum on the AACE International website set up for this particular purpose, a maximum of 10 questions for each candidate by Jan. 11, 2012. Candidates will then have until Jan. 30, 2012, to develop their responses to each question. All candidate responses will be posted in the Discussion Forum on Jan. 31, 2012, on the AACE International website. Balloting for the elections opens on Feb. 1, 2012, and closes at 4 p.m. Eastern US on March 15. All candidates for a similar position will be asked the same questions. According to Steve Revay, Chair of the Nominating Committee, The committee is of the opinion that this recommendation oers a potential method of increasing membership interest in the election process while allowing members an opportunity to get a better understanding of their candidates views. To submit a question for the candidate review process, send an email with the text of the question and to which candidate position it should be addressed to. All emails should be sent no later than Dec. 31, 2011, to:

REFERENCES
1. Hoshino, K, et al., Recommended Practice No. 29R-03: Forensic Schedule Analysis, AACE International, Morgantown, WV, (latest revision). Sanders, M., CDR.11 Forensic Schedule Analysis: Example Implementation, AACE International Transactions, Morgantown, WV, 2008. Zack, J., Schedule Delay Analysis: Is There Agreement? Presentation of example project including presentation slides, schedules and brief project description, 2003.

2.

3.

ABOUT THE AUTHOR

Mark C. Sanders, PE CCE PSP, is with Alpha3 Consulting LLC. He can be contacted by sending e-mail to: msanders@alphathree.com

pastpres@aacei.org.
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COST ENGINEERING
Vol. 54, No.1/January 2012
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Pages 4-13

The Basics of Constructive Acceleration

James G. Zack Jr., CFCC FRICS
Constructive acceleration is a well recognized claim in the US. The US federal governments Boards of Contract Appeals long ago created this claim and established the basic rules of entitlement concerning this type of claim. Thus, US-based contractors know what must be documented in order to recover in such situations. But when US contractors are working outside the US and are faced with this sort of situation, can they recover in arbitration or litigation in other jurisdictions? This article examines constructive acceleration in various legal jurisdictions (both common law and civil law) around the world to determine whether a contractor is able to use this type of claim to recover damages. This article was first presented at the 2011 AACE International Annual Meeting as manuscript CDR.521.

Article Reference Number - 21968 Pages 15-23

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Offsetting Delays The Owners Friend

John C. Livengood, CFCC PSP
When dealing with contractor delay claims, owners of construction projects often use their superior bargaining power to strike a deal better than the facts or the law would permit. This is especially true in cases where it is possible for the owner to argue sequential delays by the contractor should offset earlier delays caused by the owner, making both delays non-compensable. These delays have the special name of offsetting concurrent delays. Concurrent delays, particularly delays associated with performance of non-critical work, are poorly understood by the courts and schedule analysts alike. Savvy owners use this lack of understanding when negotiating settlements of delay claims by contractors. This article discusses the most recent technical issues associated with concurrent delay, and shows how confusion has made the legal rulings on concurrent delay unpredictable, thus strengthening the owners bargaining position and allowing for the popularity of offsetting delays claims. An earlier version of this article was first presented as manuscript CDR.609 at the 2011 AACE International Annual Meeting in Anaheim, Calif. The author has made some updates and revisions since that presentation and they are included with this printing.

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Article Reference Number - 21969 Pages 25-53

Forensic Schedule Analysis: Example Implementation Part II

Mark C. Sanders, PE CCE PSP
Recommended Practice 29R-03Forensic Schedule Analysis, has aroused significant debate in the forensic scheduling community since its original publication in 2007. Now in its second revision, the RP continues to evolve in pursuit of the original goal of providing a unifying technical reference for the forensic application of the critical path method of scheduling. During the development of the original RP, there was a proposal to include example analysis implementations, in so-called cookbook sections. The material developed for two of those sections was presented in 2008, in a paper detailing the forensic analysis of a sample project using Method Implementation Protocols 3.3 and 3.7. This article presents an analysis of the same project using MIPs 3.1, 3.2, and 3.8; presents a comparison of the results from all five analyses; and provides additional discussion of issues likely to be encountered in an actual implementation of the guidelines in the recommended practice. This was manuscript CDR.493 at the 2011 Annual Meeting.

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Skills and Knowledge of Cost Engineering, 5th Edition, Revised
Scott J. Amos, Editor, 2007 This updated and expanded guide for fundamentals is an excellent choice for anyone interested in a concise reference to all aspects of the profession. The new 5th edition includes twenty-seven chapters on estimating, manufacturing and operating costs, scheduling, planning progress and cost control, and much more. This is a very useful book for those studying for the certification exam. 450 pages 1595-02zip - Download - US$50.00 member/US$80 nonmember Paper version available through our Amazon.com link

Cost Engineering
The international journal of cost estimation, cost/schedule control, project management, and total cost management. Subscriptions are accepted on an annual basis. An automatic benefit of AACE International membership, also available to nonmembers. 5060-07 - US$72.00 (US) - US$171.00 (other countries) Please add US$80.00 for airmail - US$61 electronic subscription

CCC/CCE Certification Study Guide, 3rd Edition

Michael B. Pritchett, CCE, Editor, 2006 The AACE International CCC/CCE Certification Study Guide provides an all-encompassing reference text to prepare for the exam. The CCC/CCE Certification Study Guide provides background information on how to become certified; gives those studying for the certification exam a single reference text that includes theory, worked problems with answers, references, and a full discussion of key topics; allows students to maximize their study time; and provides a concise overview of the fundamentals of cost and project management. 1825-36zip - Download - US$50.00 member/US$80 nonmember Paper version available through our Amazon.com link

Cost Engineers Notebook

This CD-ROM is an important reference for any project or cost professional. It includes data and procedures related to basic skills and knowledge that all cost engineers should possess, extensive material on capital and operating cost estimation, and papers in four subject areas: cost control, planning and scheduling, project management, and economic analysis and business planning. 4060-28zip - Download - US$65.00 member/US$105.00 nonmember

AACE International Recommended Practices

Cost Engineering Terminology; Cost Estimate Classification System; Estimate Preparation Costs in the Process Industries; Project Code of Accounts; Required Skills and Knowledge of a Cost Engineer; Roles and Duties of a Planning and Scheduling Engineer; Profitability Methods; plus many more. 4060-05zip - Download - US$70.00 member/US$110.00 nonmember

PSP Certification Study Guide, 1st Edition

Peter W. Griesmyer, Editor, 2008 This study guide is intended to assist you in your study and review of the overall topics as one step toward successful Planning and Scheduling Professional certification. The outline provides a listing of the terms you should know & topics for which you should have a good understanding of how to apply the concepts to solve problems. Each chapter also contains sample exercises, which test your knowledge of that chapter's concepts. Additional sample questions are provided in an appendix. 1820-38zip - Download - US$50.00 member/US$80.00 nonmember Paper version available through our Amazon.com link

The Total Cost Management Framework

John K. Hollmann, PE CCE, Editor, 2006 4060-20zip - Download - US$50.00 member/US$70.00 nonmember Paper Version available through Amazon.com

2011 AACE International Transactions

5220-11 zip Download - US$75.00 member - US$80.00 nonmember For CD-ROM version please contact AACE International Headquarters

EVP Certification Study Guide, 2nd Edition

Ken Cressman, CCC EVP and Gary C. Humphreys, Editors, 2009 This study guide is intended to assist you in your study and review of the overall topics as one step toward successful Earned Value Professional certification. The outline provides a listing of the terms you should know & topics for which you should have a good understanding of how to apply the concepts to solve problems. Each chapter also contains sample exercises, which test your knowledge of that chapter's concepts. 1820-40zip - Download - US$50.00 member/US$80.00 nonmember Paper Version available through our Amazon.com link

The The AACE AACE International International Professional Professional Practice Practice Guides Guides (PPGs) (PPGs)
Value; Earned Value Reporting; Applications of Earned Value Project Management; and more.

PPG #14: Portfolio and Program Management,

2nd Ed. Randy R. Rapp, PE CCE, Editor, 2007
Covers: Enterprise Management: General Imperatives and Concerns; Asset Requirements Elicitation and Analysis; Asset Planning and Investment Decision-Making; Asset Performance Assessment and Change Management; and Program Management.

PPG#6: Construction Cost Estimating, 2nd Ed.

Dr. Douglas D. Gransberg, PE CCE, And Carla Lopez del Puerto, CCC, Editors, 2006
Covers: Recommended Practices; Estimating Theory; Conceptual, Parametric, and Range Estimating; Estimating Factors and Indices; Estimating Material Costs and Quantity Surveying; Estimating Labor Costs; Estimating Equipment Costs; Subcontracting Costs; Estimating Overhead and Indirect Costs; Profit, Contingencies, and Mark-Ups; Estimating International Construction Costs; and more.

PPG #15: Life-Cycle Cost Analysis

Dr. Douglas D. Gransberg, PE CCE, and Carla Lopez del Puerto, CCC, Editors, 2007
Covers: Life-Cycle Cost Theory; Life-Cycle Cost Methods, Determining Discount Rate; Estimating Capital Cost of Design and Construction; Estimating Operating Costs; Estimating Salvage/Residual Value; Estimating Sustainability; Life-Cycle Cost Risk Analysis; Life -Cycle Cost Case Studies; Life-Cycle Cost Analysis in the International Context

(PPGs) are a series of reference s that consists of selected Cost Engineering articles, AACE International Transaction papers, and other previously published
documents to which AACE has rights.

PPG#7: Cost Engineering in the Utility Industries, 2nd Ed.

Dennis M. Thompson, Editor, 2007
Covers: Auditing; Cost Estimating; Cost Modeling; Cost/Schedule Control; Generation Power Plant; Natural Gas Industry; Nuclear Power Plant; Other Energy Related Topics; Planning and Scheduling; Project Management; Utility Rates; and Utility Property Valuation.

PPG #16: Cost Engineering in the Global Environment

Kul B. Uppal, PE, Editor, 2007
Covers: General Topics on International Projects; Applicable AACE International Recommended Practices; Cost Estimating Methodology; Risk and Contingency; and Miscellaneous Topics

Price per PPG: Download Member Price US$50.00 Download Non-Member Price US$70.00 Price for the PPG Package includes all 21 PPGs: Download Member Price US$874.00 Download Non-Member Price US$1223.00
PPG#1: Contracts and Claims, 4th Ed.
James G. Zack Jr., Editor, 2008
Covers: Contract Administration; Management of Construction Schedules; Schedule Control; Schedule Float Ownership; Cost Control; Management of Change; Cost Impacts; Productivity Impacts; Management and Analysis of Delay; Concurrent Delay Issues; Pricing of Delay; and more.

PPG#8: Contingency, 2nd Ed.

Kul B. Uppal, PE, Editor, 2005
Covers: General Topics On Contingency; Cost Estimating and Contingency; Risk Analysis and Contingency; and Other Related Topics.

PPG #17: Public Sector Estimating

Joseph L. Macaluso, CCC, Editor, 2007
Covers: Basis of Estimates; Labor Costs; Overhead and Profit; Soft Costs; Bid/Estimate Reconciliation; and Change Orders

PPG #10: Project Delivery Methods, 2nd Ed.

Dr. Douglas D. Gransberg, PE CCE, Tammy L. McCuen, and Keith Molenaar, Editors, 2008
Covers: Design-Bid-Build (DBB) DBB Estimating, DBB Scheduling, DBB Project Management; Construction Management (CM) CM Estimating, CM Scheduling, CM Project Management; Design-Build (DB) DB Estimating, DB Scheduling, DB Project Management; International Project Delivery; Constructability; and Partnering.

PPG #18: Green Building

Joseph L. Macaluso, CCC, Editor, 2008
Covers: Recognition of Affects and Economic Costs on the Environment; Formulating Ways of Addressing Green Building Strategies and Associated Economic Costs; Specific Green Building Strategies and Project Costs; Budgeting and Justifying the Cost of Sustainable Practices; Evaluating Competing Sustainable Strategies: Using Value Engineering; Evaluating Competing Sustainable Strategies: Other Techniques

PPG #11: Environmental Remediation & Decommissioning, 2nd Ed.

Richard A. Selg, CCE, Editor, 2009
Covers: Environmental Remediation Planning and Scheduling Methodology; Cost Estimating, Project Controls, Cost Modeling, and Reporting; Contingency Management, Risk Analysis, and Environmental Regulations; Benchmarking and Lessons Learned; Economics of Environmental and Waste Management; Cost-Effective Waste Minimization and Pollution Prevention; Design, Construction Practices, and Other Related Topics.

PPG #19: Leadership and Management of People

John J. Hannon, CEP, Editor, 2008
Covers: Leadership; Teams; Leadership Roles; Motivation; and Ethics.

PPG#2: Risk, 2nd Ed.

Keith D. Brienzo, PE, Editor, 2007
Covers: Dictionary; Capital Investments; Cash Flow; Competitive Bidding; Contingency Analysis; Contracts; Cost Engineering; Currency Rates; Decision Trees; Economic Analysis; Escalation; Human Factors; Manufacturing; Research & Development; Safety & Health; Schedule; Technological Risk; and Value Engineering.

PPG #20: Forensic Schedule Analysis

James G. Zack, Jr., CFCC, Editor, 2008
Covers: Recommended Practice No. 29R-03 Forensic Schedule Analysis; Synopsis of Recommended Practice; Basics of Schedule Delay Analysis; MIP-Observational Static Gross; MIP-Observational Static Periodic; MIP-Observational Dynamic Contemporaneous As-Is; MIP-Observational Dynamic Contemporaneous Split; MIP-Observational Dynamic Modified or Recreated; MIPModeled Additive Single Base; MIP-Modeled Additive Multiple Base; MIP-Modeled Subtractive Single Simulation; Non-CPM Schedule Delay Analysis Techniques; General Schedule Analysis Articles

PPG #12: Construction Project Controls

Dr. Douglas D. Gransberg, PE CCE, and James E. Koch, Editors, 2002
Covers: Introduction to Construction project Controls; Cost Control; Schedule Control; Quality Control; Document Control; Computer Applications; and International Project Controls

PPG#3: Cost Engineering in Aerospace and Aviation

Sarwar A. Samad, Editor, 1998
Covers: Aerospace and Aviation.

PPG#4: Planning and Scheduling, 2nd Ed.

Trevor X. Crawford, CCC, Editor, 2006
Covers: Planning; Schedule Development; Schedule Management/Control; and Classics.

PPG #13: Parametric and Conceptual Estimating, 2nd Ed.

Douglas W. Leo, CCC, Larry R. Dysert, CCC, and Bruce Elliott, CCC, Editor, 2004
Covers: Parametric/Conceptual Estimating; Classification; Methodology; Capacity Factoring; Process and Non-Process Industries; and Systems

PPG#21: Cost Engineering in the Process Industries

Kul B. Uppal, PE CEP, Editor, 2009
Covers: General Topics on Process Industries; Cost Estimating Methodology; Project Management; International Projects; Scheduling; Construction Activities; Risk Management; Project Controls; and Applicable AACE International Recommended Practices.

PPG#5: Earned Value, 2nd Ed.

Robert A. Marshall, Editor, 2007
Covers: Why Use Earned Value?; Basics of Earned Value; Cost/Schedule Control System Criteria; Actual Physical Percent Complete; Productivity and Earned

More AACE Publications at the Online Store - www.aacei.org

CALENDAR OF EVENTS
MARCH 2012
15-18 2012 Western Winter
Workshop, San Francisco Bay Area Section of AACE International Harrahs & Harveys Casino Resort Lake Tahoe, NV Contact: aacei.sf.www.2012@gmail.com www.aaceisf.org

JULY 2012
5-8 AACE International
Education Seminars, AACE International Marriott Rivercenter Hotel San Antonio, TX Contact: phone 1-800-858-COST fax (304) 291-5728 info@aacei.org www.aacei.org

NOVEMBER 2012
14-15 AACE Internationals
International Total Cost Manage ment Conference, AACE International Hyatt Regency Dubai and Galleria Dubai, United Arab Emirates Contact: phone 1-800-858-COST fax (304) 291-5728 info@aacei.org www.aacei.org

8-11 AACE Internationals

2012 Annual Meeting, AACE International Marriott Rivercenter Hotel San Antonio, TX Contact: phone 1-800-858-COST fax (304) 291-5728 info@aacei.org www.aacei.org

Please submit items for future calendar listings at least 60 days in advance of desired publication.
AACE International, 1265 Suncrest Towne Centre Dr, Morgantown, WV 26505-1876 USA phone: 304-296-8444 fax: 304-291-5728 e-mail: editor@aacei.org website: www.aacei.org

12-13 AACE International

Education Seminars, AACE International Marriott Rivercenter Hotel San Antonio, TX Contact: phone 1-800-858-COST fax (304) 291-5728 info@aacei.org www.aacei.org

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COST ENGINEERING JANUARY 2012