April 26, 2022
It all comes down to this – the last 100m to the finish line quickly approaches as a Host country prepares to welcome thousands of athletes, officials, and spectators to its beautiful city, and newly constructed / refurbished, world class infrastructure – it cannot be late.
Unlike almost any other major infrastructure project, countries hosting the Olympic and Paralympic Games face an immovable deadline for its delivery – the Opening Ceremony. As discussed in Part 3 of this series, the infamous price tag of delivering an Olympic & Paralympic Games is often linked to this absolute deadline – there is no (or little) opportunity for negotiation or sacrifice of schedule over cost.
The Games pose a key reminder of the importance of delivering a large-scale project on time. The final part of this series will identify some strategies which can be implemented in major projects to ensure it crosses the finish line on time.
Preventing Project Delays
Whilst there are issues beyond the parties’ control which can inevitably cause delay in a project’s delivery (most recently and significantly, the COVID19 pandemic), there are many impacts of delay which can be avoided and reduced. Some strategies which parties may consider implementing to avoid / reduce delays, or manage them should they arise, are outlined below.
- Program Preparation & Review – Time is money, meaning a failure to understand the scope of a project which necessarily leads to inadequate scheduling for completion, will cause delay to the project and subsequently result in an increased overall cost. Whilst the parties may be eager to commence the project, they should avoid a “one size fits all” program for delivery, even if they have previously engaged in similar projects. Instead, parties should carefully and meticulously consider the scope and all available information for the project to ensure it has prepared a complete and comprehensive program (including an accompanying narrative). This will also assist the parties in setting (and achieving) realistic goals for milestones and project completion – timelines that are too short or impossible to achieve will undoubtedly result in delay to a project’s overall delivery.
- Regular Program Review – No matter how perfect a project’s program is, there is always the possibility for delay. By regularly reviewing and resubmitting the program to reflect changes in the project, contracted parties are able to manage expectations of the contracting party, and are able to identify the impact that a change or issue has had, or could have, on the project’s delivery. Maintaining regular updates to a program is particularly beneficial where regular reporting is required – reporting on the progress of a project based on an outdated program will necessarily cause “surprise” delays at the conclusion of the project (where it may be too late to claim for a delay, depending on the contract’s time bar provisions).
- Adequate Contract Documents – Inappropriate contracting and construction documents for a project can cause significant, lengthy, and costly issues throughout the delivery of a project. Investing in the preparation of a complete, accurate, and appropriate contract and set of constructions documents at the outset (including designs, current site information, and technical specifications), will encourage the flow of information between the parties from the outset, manage the parties’ expectations, identify the risk allocation (including for delays, variations, and other issues occurring over the course of the project), and provide a useful tool for managing issues and disputes, should they arise. Providing these document pre-contract will also allow the parties to review and clarify any ambiguities (before any issues which will cause delay, arise) and will assist the contractor in preparing an accurate and suitable program for project delivery.
- Change in Scope – Changes in scope or variations (no matter how small) are inevitable, often costly, and can cause significant delays on projects which impact an often already strict timeline. Changes in scope (when directed) will generally allow the contractor to claim for an extension of time. However, other “unforeseen changes” causing delay which arise due to defects requiring rectification or as a result of omissions / errors in design, accidently omitted scope or mistakes, must often be borne by that party. These “unforeseen changes” will be particularly apparent in projects with a poorly defined scope or poor technical specification. Prior to entry into the contract, the parties should closely assess the project requirements, technical specification, and other available information to ensure its program adequately and comprehensively addresses all activities required to deliver the project, and ensure the parties clearly understand what is required in delivering the project – this may ultimately afford it more flexibility to overcome unexpected delays throughout the project. The parties should also ensure the contractual documents contain a clear process for variations and extension of time claims (including the process, pricing of, and entitlements of the parties), which will ultimately minimise the impact of a dispute on the project’s delivery.
- Access to Site & Information – Both parties should ensure that there will be no delay at the commencement of the project in providing access to site and other required information. Whilst a contract will often provide an avenue for relief due to delays in these circumstances, it will ultimately still delay the anticipated completion of a project, and may result in additional costs to the contracting party.
- Budget Constraints – a party exceeding its allocated budget is a sure-fire way to halt the progression of a project. The likelihood cost overruns can be minimised by ensuring an accurate, adequate, and comprehensive budget has been implemented on a project. See Part 3 of this series for further discussion on this point and tips for preventing budget blowouts.
- Effective Communication – Mistakes are bound to happen due to miscommunication. Minimising confusion between parties will in turn, minimise the likelihood of issues arising which cause delay. Maintaining communication channels between the parties and providing regular updates on the project, will increase visibility of the parties and prevent delays arising which may otherwise be unknown to the parties.
- Clear Roles & Responsibilities – Clearly defining roles and responsibilities of all personnel in the project (utilising organisation charts and job descriptions) will minimise the likelihood of tasks being completed more than once, preventing lost and wasted productivity, and subsequently preventing project delays. Further, any subcontractor, vendor or other party engaged should be verified as having the appropriate skill and expertise for the project, as inexperienced or inappropriate parties can cause costly mistakes, errors and delays. In circumstances where a subcontractor is engaged, the contractor should also ensure its subcontractor is aware of, and can abide by, the program established under the head contract.
- Avoiding Disputes – Disputes occurring during projects are a major cause for delay, particularly in circumstances where the parties disagree on a process for executing part of the scope, as this can halt the project’s progress all together. One strategy to aid in avoiding dispute is to ensure the contract is complete and unambiguous, and contains clear processes for claiming variations, delays, and making other contractual claims, and contains an appropriate dispute resolution clause, which may include an obligation on the parties to continue works whilst the dispute is being addressed. The inclusion of these processes will ensure the continued progression of the project, and will minimise delays incurred as a result of the dispute.
Taking the time to prepare adequately for a project prior to its commencement (that sets the project up for success) will assist both parties in preventing delays over the life of the project.
Lamont Project & Construction Lawyers
Our Team have the industry knowledge and experience to assist both Principals and Contractors in contract development and amendments, and major project delivery. If you would like to discuss any matters raised in the above article or the forthcoming series as it relates to your specific circumstances, please contact Lamont Project & Construction Lawyers.
The contents of this article is for information purposes only; it does not discuss every important topic or matter of law, and it is not to be relied upon as legal advice. Specialist advice should be sought regarding your specific circumstances.
Contact: Peter Lamont or Lili Hoelscher
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