Evaluation of Schedule
Impacts
By: Randa Jarjour
1/19/06
Classification of Project Delays
(Risk Point of View)
•Non-excusable
•Excusable
–Compensable
–Non-compensable
2
Non-excusable Delays
• Contractor problems result in schedule
impacts
• Contractor not entitled to either time
extension or compensation
• Examples:
– Late Submittals
– Late Material Delivery
– Insufficient Manpower…..
3
Excusable Non-compensable
Delays
• Uncontrollable events such as weather,
strikes, etc. sometimes referred to as
“Force Majeure”
• Contractor is eligible for time extension
• Contractor not eligible for extended
“General Conditions” costs
• Contractor has to meet burden of proof
4
Excusable Compensable
Delays
• Owner or owner’s agent problems result
in schedule impacts
• Contractor eligible for time extension
• Contractor eligible for extended
“General Conditions” cost
• Contractor has to meet burden of proof
5
Concurrent Delays
Definition:
• “Concurrent Delay” is experienced on a
construction project when two or more
separate delay events occur during the same
time period.
• Multiple causes to a critical path delay with
both contract parties involved. In the
absence of one party’s cause, the other
party’s cause will govern.
• The schedule has more than one critical path
with a separate delay affecting each at the
same time (very rare)
6
Concurrent Delays
• Significance
Determines compensability
• Apportionment:
Where both parties contribute to the
delay neither can recover damages
unless there is clear evidence by which
we can apportion the delay and the
expense attributable to each party
7
Concurrent Delays
•
•
•
•
Elements:
Two or more delays occur during the same time period
Both delays impact the critical path
Delays may be caused by either or both parties, or
unforeseen events
In the absence of one delay event, the other delay
event will govern.
Governing Rules:
• The float belongs to the project
• Both parties have the right to use any additional float
• The Critical Path with respect to a specific milestone is
the path with the least total float
8
Concurrent Delays:
• Concurrent delay by owner and contractor is
excusable but not compensable
 Delay events occur
during the same time
period
Contractor Delay: 5 days lost in
fabrication
 They impacted the critical
path
Critical Path Activity
Owner Delay: 5 days lost in reviewing the installation procedure
Concurrent cause of Critical Path Delay of 5 Days
Result:
5 excusable (non-compensable) days to contractor
9

In the absence of one
delay event, the other
delay event will govern.
Concurrent Delays:
• Concurrent delay by contractor and an uncontrollable
event is excusable but not compensable
Critical Path Activity
Contractor
Delay: 5
days lost
due to
productivity
issues
 Delay events occur
during the same time
period
5 Days of CP Slippage
 They impacted the critical
path
Critical Path Activity

3 days of Rain
Concurrent cause of Critical Path Delay of 3 Days
Result:
3 excusable (non-compensable) days
2 non-excusable days
10
In the absence of one
delay event, the other
delay event will govern.
Concurrent Delays:
•Concurrent delay by owner and an uncontrollable event
is excusable but not compensable
Critical Path Activity
 Delay events occur
during the same time
period
Owner Delay:
15 days lost
resolving a
design issue
15 Days of CP Slippage
Critical Path Activity
 They impacted the critical
path

10 days of Rain
Concurrent cause of Critical Path Delay of 10 Days
Result:
10 excusable non-compensable days
5 excusable compensable days
11
In the absence of one
delay event, the other
delay event will govern.
Example: Delays Concurrent
Owner Delay Impacting
Framing Activity (12 days)
12
WF L1
WF L2
TF=5 days
5
 Delay events occur
during the same time
period
Submittal/Fabrication L2
7
Contractor Delay Impacting
Fabrication (7 days)
7
WF L1
 They impacted the critical
path

WF L2
5
In the absence of one
delay event, the other
delay event will govern.
Submittal/Fabrication L2
Result:
7 days of Concurrent Delay
(Excusable, Non-compensable)
WF L1
WF L2
5
Non-critical Delay
7 CP Delay
7
Submittal/Fabrication L2
7
12
5
7
Example: Delays not Concurrent
Owner Delay Impacting
Foundation Activity
15
TF=5
Foundation
 Delay events occur
during the same time
period
Steel Erection
Steel Fabrication
× They impacted the critical
path
Contractor Delay
Impacting Steel
Fabrication
5
×
Delay not during same time frame:
In the absence of one
delay event, the other
delay event will govern.
1st CP Slippage
5
5
10
Foundation
Steel Erection
Steel Fabrication
5
Added Float
5
Contractor has the right to
use the added float
Delay during same time frame:
5
10
5
Foundation
2nd CP Slippage
Result:
Total Critical Path Slippage of 10 days is
Compensable.
Steel Erection
Steel Fabrication
5
5
Added Float
13
Delay Mitigation
• Contractor has an implied obligation to
accelerate to mitigate delays, when
possible.
• Further or additional acceleration might
be possible, but might also have a price
tag.
• The cost of further or additional
mitigation needs to be evaluated
against the cost of time extension.
14
Recovery Schedules &
Proposals
• Requesting a Recovery Proposal to
recover from an Owner-caused delay
limits the Contractor’s right to the added
Float in non critical paths created by the
owner-caused delay.
• Unrealistic Recovery Schedules can be
used to hide Contractor delays and
delay concurrency.
15
Methodology for Delay
Quantification
• Total-Time Schedule Approach
• Adjusted As-Planned Schedule Approach
• Adjusted As-Built Schedule Approach
• Contemporaneous Time Frame Analysis
16
Total-Time Approach
Ownercaused
Project
Delay
As-planned Duration
As-built Duration
To use this approach, the Contractor needs to show:
(1)
(2)
(3)
(4)
As-planned schedule reasonable and constructible
It manned the job as planned and deployed the resources prudently
It did not cause any delays
There is no other reasonable way to quantify the delay
17
Adjusted As-Planned Approach
Ownercaused
Project
Delay
As-planned
Ownercaused
Delay
Adjusted
As-planned
Ownercaused
Delay
As-planned duration and logic unchanged (Too hypothetical)
Baseline Critical Path is the basis for the analysis
Ignores Concurrency of delays
18
Collapsed As-Built “But For”
Approach
As-planned
Owner Delay
As-Built
Contractor Delay
Collapsed
As-built
Owner-caused
Project Delay
Contractor Delay
As-Built schedule is used as the base for the analysis
Ignores the timing of the delay (what was the critical path at the time of delay?)
Does not evaluate concurrent delays
19
Contemporaneous Approach
2 Delays
As-planned
Update
Date
Contractor-caused
Project Delay
Contractorcaused
Delay
1st Delay
2nd Delay
Contractorcaused
Delay
Update
Date
Ownercaused
Delay
20
Owner-caused
Project Delay
Contemporaneous Approach
Same but Owner Delay Happened First
As-planned
Update
Date
Owner-caused
Project Delay
Ownercaused
Delay
1st Delay
Ownercaused
Delay
No Project
Delay
2nd Delay
Update
Date
Contractorcaused
Delay
21
Contemporaneous Approach
“TIA Event Update Analysis”
“ Fragnet Analysis”
• The importance of timing: When the delay-causing
events occurred
• What was the Critical Path when the delay-causing
events occurred
• Using current schedule updates as the basis for
analysis
• Takes into account the dynamic nature of the
schedule
• Concurrency and therefore compensability of delays
can be evaluated.
• The most preferred method
22
LAUSD Scheduling Specification
• Calls for contemporaneous Fragnet
approach
• Requests supporting elements:
Baseline schedule, weekly and monthly
schedule updates
• Baseline and monthly schedule
submittals reviewed/accepted for quality
23
LAUSD Scheduling Specification;
Steps
• Contractor recognizes an impact
• Contractor notifies District of actual or
potential impact in a timely manner
• Pre-delay schedule prepared by Contractor
• Pre-delay schedule approved by District
• Delay Fragnet prepared by Contractor
• Delay Fragnet approved by District
• Net impact calculated/negotiated
24
Projected Delays
• Projected delays are delays or portions
of a delay that extend into the future
• They are time estimates
• They affect the Critical Path
• LAUSD Specifications calls for the
approval of projected delays (Fragnets)
before they can be incorporated into the
schedule
25
Projected Delays
26
Risk!!!!
What if Contractor and District could not
reach an agreement regarding the
amount of time extension and/or the
compensability of the delay?
27
Risk!!!!
What if the District wrongfully rejects the
Contractor’s request for time extension
and/or compensation?
28
Risk!!!!
What if the Contractor does not provide
the specified backup to support the time
extension/compensation request?
29
Elements of Constructive
Acceleration
• Based on the owner’s unjustified
refusal to grant a time extension or
failure to act
• Requires that:
–
–
–
–
A cause exists that would justify a time extension
A proper request for a time extension
Denial of that request
Demand (express or implied) that performance be
completed on time
– An actual acceleration
30
Best Practice
• Enforce the contract requirement for a
good baseline schedule and schedule
updates with a narrative for each as
required
• Enforce the contract requirement for a
formal notice announcing a potential delay
• Enforce the contract requirement for a
Fragnet showing Critical Path impact
• Enforce the contract requirement for
timely submittal of all the above
31
Best Practice
• Do not waive the contract requirements
by your act or failure to act
– Do not give up on sending a letter
requesting the schedule submittal
– Do not give up on sending a letter
requesting a Fragnet as backup for a COP
requesting time extension
– In your requests, always explain the
reasons why you need the schedule or the
Fragnet.
32
Best Practice
• Use the “Notice of Event” tool to establish
a track record of communication on
potential delays. This will reduce
surprises at the end of the project
– District has contractual right to know so it
can make decisions to mitigate and/or
evaluate options
– Investigate the criticality of the issue and act
on it
– Respond to the notice until closed
33
Best Practice
• When scope is added to the Critical
Path, shift the risk to the contractor as
soon as possible
– District has no control over the execution of
the added scope and therefore should not
be assuming the risk
34
Best Practice
• When scope is added to the Critical Path,
shift the risk to the contractor as soon as
possible
– Request the time estimate and schedule
analysis
– Negotiate time
– Contractor has right to reasonable
contingency, not sandbagging
– Consider recovery schedules, if applicable
– Make them commit
35
Best Practice
• Analyze and negotiate delays on a monthly
basis.
– Calculate the net monthly Critical Path
slippage, if any
– Request Fragnets, if not submitted yet
– Allocate/proportion delaying factors (owner,
contractor, concurrent)
– Schedule a meeting to understand/negotiate
– Always take the initiative to document/issue
the results of the meeting even if only partial
or no agreement is reached
36
Best Practice
• Analyze and negotiate delays on a
monthly basis.
– Negotiation meetings must address all
claimed delays that affected the project
within a specific time frame
– The objective is to resolve delays up to the
end point of the time frame
– Assumptions on projected portions of a
delay must be documented as part of the
agreement
37
Best Practice
• Demonstrate good faith even if the
Contractor is not cooperating
– In case the Contractor does not provide the
appropriate backup/analysis for a delay that
you recognize, run your own analysis, put it
on the table for discussion and present the
Contractor with an offer for resolution.
Issue a letter documenting your effort
38
Best Practice
• Demonstrate good faith even if the
Contractor is not cooperating
– If you’re able to reach only partial resolution
with the Contractor, isolate the disputed
portion and issue a separate unilateral CO
for this portion
– If you’re unable to reach any resolution with
the Contractor, issue a unilateral CO for
time extension
– Avoid constructive acceleration by
discussing recovery options
39
Key Points to Remember
• Communicate
• Document
• Enforce the requirements of your
contract
• Do not waive the requirements by your
act or lack of action
• Shift the risk to the Contractor, for work
that you have no control over, as soon
as possible
40
Key Points to Remember
• Negotiate time impacts on a monthly
basis
• Demonstrate good faith even if the
Contractor is not cooperating
41
QUESTIONS?
42