Hi Trevor,

One of the contractors we’ll be working with has tried something similar (not a pre-emptive variation, but claiming a variation was contractor proposal when it wasn’t, semmingly just because good minutes weren’t available to disprove it) on a previous project.
Before my time so I don’t know the full details, but this is the reason the risk has been raised.
Also my client is moving towards a more adversarial form of contract administration than it has used in the past, so is expecting contractors to hit back.

Presumably if the client rejects the contractors proposal, and then 6 months later issues the very same under a client variation, the contractor would then point out this was his idea all along and resubmit the contractors variation.

I totally disagree that reading the contract is evidence of complete failure. It’s pretty fundamental to good project management & control, IMHO.

Maybe we are worrying about nothing, but my client is concerned and I said I’d ask around.

Thanks again for everybody’s comments on this.

I now have a different, but relevant question, which is:
What is a Contractor’s Proposal?

To summarise the issue, if a contracor proposes a variation to the contract, which is accepted by the client, the target cost and contract durations cannot be reduced because of it.

So what is to stop a Contractor submitting hundreds of proposals on day 1 of the contract to cover any possible future variations which the client may issue, to ensure they see the benefit rather than the client?

The relevant contract (modified IChemE Burgundy) clause is:

17.1 The Contractor may at any time during the performance of the Contract submit a proposal for a Variation to the Project Manager. Initially such proposal should be given as a brief written outline as soon as the Contractor is first aware of the possibility of the Variation.

More specifically:
On a number of process upgrade projects I’m currently client rep for, a common constraint written into the contract will be to limit the contractor to take only 1 process unit out of service at any one time, to ensure the works continue to operate satisfactorarily.
The risk is that the contractor on day 1 will submit contractor proposals to work on more than one process unit at a time, knowing that should the project be delayed in the future then this would be a likely avenue the client would look into to recover delay.
All the process analysis & risk mitigation measures which would be required to allow more than 1 process unit to be out of service at a time, would be done by the client.
In such circumstances, it does not seem right that the contractor should see the benefit of such variations for doing nothing more than writing a couple of sentences at the start of the project, but this seems to be how the clause is written.
Does anyone know if such an issue has been tested in (UK) court?

Cheers,

G

Thanks for your reply, Samer.

I am actually representing the client.

To clarify the situation, the client had specified in the contract provision of X no. of Y-type equipment. When contractor went out to tender, suppliers informed that this would not achieve a sound engineering solution.

The client accepts responsibility for this error and agrees a variation is required.

The issue is that the contractor sees this as 2 variations:

Variation 1: EOT due to increased design time to find an acceptable alternate engineering solution
Variation 2: Implementing this alternative solution, which also came with a significant time saving on delivery periods. But these time savings cannot be translated into a ’negative EOT’ under the contract.

Hence they think they are entitled to a signficant EOT.

I think the two variations should be treated as one, and as such the delay in design would be balanced by the saving in delivery periods.