Construction Management Guide

No Increases Allowed

The term guaranteed maximum price when applied to a construction contract provides for the employer a nice feeling of security. He of she when entering into a contract of this nature is convinced that no matter what happens the final cost will not be above the maximum and there is a fair chance it could be lower. Any design changes which results from the specific instructions of the employer would understandably fall outside the guaranteed price. Guaranteed maximum price contracts have been with us for many years. IDC a Stratford on Avon construction company who pioneered design and construct contracts some twenty five or thirty years ago promoted their contracts as guaranteed maximum price. It is a good selling point which can be persuasive. [Read more…]

In some cases, such as a government project, periodic audits may be called for as a part of the overall contract. This “outside party” could be any qualified person outside of the project manager. In some cases, your organization may have an internal project audit specialist. It is possible that the Project Director or the Project Sponsor could also perform this audit. The outside party could be an outside contractor or consultant, but they do not need to be. [Read more…]

EPC Forum 2013, a multi-streamed conference targeting the EPC sector from the Middle East region, will be held on 18^th-19^th March 2013 in Hilton Abu Dhabi, United Arab Emirates as announced by marcus evans, one of the world’s largest conference organisers. [Read more…]

Interested in getting the latest best practice guidance on FIDIC contracts from the very people responsible for drafting and updating the contracts? How about getting tailored advice for the Middle East?

You’ve got one chance this year. Join us at FIDIC’s 4^th Middle East Contract Users’ conference – and get a 20% saving courtesy of CMguide.org!

Taking place in February in Dubai, this year we have the pleasure of welcoming Samer Skaik, the founder of CMguide.org to our panel of 29 distinguished speakers. [Read more…]

by Eric Teo

What are the rights of an employer in the event a nominated sub-contractor fails to deliver the standard or quality of material and workmanship that the employer had expected to receive? Common wisdom dictates that the employer would ordinarily seek recourse against the main contractor for the sub-contractor’s failure, but are there any alternatives? [Read more…]

Exclusion clauses in your terms and conditions could save your business, reports Thomas Eggar LLP senior associate Kim Teichmann. In Allen Fabrications Limited v ASD Limited the defendant avoided a £7m claim due to a term that limited its liability to £705. A large saving for such a little clause! [Read more…]

By Azzam Messaykeh

Today, with intense competition, high costs of operation and still-struggling economies, businesses are seeking ways to become leaner, more agile and increase operational efficiencies.

Concentrating efforts on cutting costs makes sound business sense, and that is where the importance of energy performance contracting comes in, making it a viable financial strategy. [Read more…]

Scope change is not inherently bad or good. However, the team can react to changes in positive and negative ways, depending on the state of the project. A typical reaction from most project teams is to just go ahead and make the approved changes. However, there is another reaction that can be more problematic – the team may not want to make any more changes. This is the scenario for this column. This situation could occur for a variety of reasons. [Read more…]

Gather Subjective Metrics with Client Satisfaction Surveys

Gathering metrics is important because it allows you to see how you are performing against the expectations of your clients. If the world were perfect, all of the metrics you collect would be factual, relevant and accurate. However, in many cases it is impractical or cost-prohibitive to try to gather exact and quantitative numbers. [Read more…]

By Katie Liszka
Direct agreements are used in project finance transactions to provide lenders with protection should the project get into difficulty. These are contractual mechanisms that enable the lenders to step into the shoes of the project company (the borrower) and take over the project and/or find a substitute entity to continue the project. The parties to the direct agreement include the project company itself and the counterparty to the project document to which the direct agreement is collateral to. [Read more…]