Cons 0010 - Construction Contract Administration - Demolition of the Rosen Building - Civil Engineering Assignment Help

Assignment Task

Cons 0010 - Construction Contract Administration - Demolition of the Rosen Building - Civil Engineering Assignment Help

Case 1
On 26 July 2014 Coin Builders Ltd (Coin) entered into a contract with Rosen Supply & Services (Rosen) to demolish a 5 storey building known as the ‘Rosen Building’, and to regrade the site and do the preliminary civil works. The site is located in a suburb of Sydney, NSW.  The project was to have been completed in 24 months and Coin was to be paid $4 million.  
 
History of the Tender  In late May 2014, Coin had responded to an invitation to tender from Rosen for the demolition and site regrading for the Rosen Building. Specifically the invitation to tender, which was advertised in the newspaper, read:

Project: Demolition of the Rosen Building, breaking up of the paved parking area, removal of all debris and filling of the basement void and other associated civil works.

On 10 June 2014 Coin received from Rosen the tender package, which included blueprints of the Rosen Building, 4 contract drawings, the specifications, the contract, and the tender form.  The 4 contract drawings were as follows:
a. Site Outline - a basic outline of the Rosen Building and existing conditions at the site prior to demolition.
b. Site Plan – rough grading, which indicated the rough grade elevations to which Coin was to grade the site and the final grade elevations.  
c. Civil works- drawings indicating the associated civil works required.
d. Site Sections – which included an outline of some existing items to be demolished and removed from the site.
A pre-tender meeting was held on 3 July 2014.  Rosen’s project manager (Bill) and Coin’s project manager (Dave) attended.  At that meeting, Dave asked how much of the retaining wall was to come down and were there any other problems with the site. He was told, “no worries mate it’s a good site but you need to read the drawings”.  Dave also visited the site.  
Based on this conversation Coin decided to allow for normal excavation with rock not occurring above 3.0 meters from the surface.
 In the tender document submitted by Coin, Coin certified that Coin had visited the site and become fully conversant with conditions required to perform the work of the contract; that it had satisfied itself of the suitability, quality and quantity of surface and sub-surface material to be encountered and that any failure to do so would not relieve it of the responsibility of performing the work. This certificate was attached as an appendix to the contract.
Tenders closed on 12 July 2014.  The coin was the successful bidder

QUESTIONS

1. On commencing work Coin found:
a. Rock at a depth of 1.0 meters.  
b. The site was contaminated with asbestos.
This resulted in considerable extra costs. Your claim for extra costs was rejected by the Superintendent who cited clause 18 and the appendix containing Coins certificate regarding the site. You are asked by Dave if he should declare a dispute Assuming you met the notice period requirements Advise Dave if have any avenues of claim and if so what are they. Please discuss in detail the strengths and weaknesses of your potential action.
2. Based on case 1, A dispute was declared and during discovery, you find the that Rosen was in possession of a soils report which showed rock at a depth of 1.0 meter and the asbestos. However, this was sent to Rosen’s geology department and Rosen’s project team were not aware of its existence.
Would this modify the likelihood of success of your claim and if so why?
Would it make a difference if Rosen’s project manager had sent a company-wide email asking for all available information of the site and received no response from the geology department?
3. In the situation described in case 1 you have put in three claims for other issues without meeting the notice provisions which the Superintendent has accepted, but on your claim for a forth matter the Superintendent rejects for failure to comply with the notice provisions.
Dave suggests you can claim using unjust enrichment or implied promise to pay.  
(a) Advise Dave on the strengths and weaknesses of a claim under these headings.
(b) What other avenues would you suggest could be used to pursue Coin’s claim.  
(c)  How would you defend against claims made on the basis you suggest? What strategies could have been employed by the Superintendent to grant your first three claims whilst reducing any likelihood of future claims without the required notice succeeding?
4. During the contract, the Superintendent deletes 20% of Coin’s scope:
a) Do you have any right to object or is this within the power of the Superintendent?
b) You subsequently find that the Superintendent has placed your scope in another contract package and let the work. Have your rights changed and if so in what regard and what action do you recommend that Coin take?
c) How would you react to the approach you suggest if you worked for the Superintendent?
The Superintendent issues a variation for a fifth matter. You complete the work but when you submit your claim the Superintendent refuses payment on the grounds that the scope of this variation was already in the original contract.
Does Dave ask you should Coin pursue the claim? What do you advise Dave and why?
5.  You serve your progress claim on Rosen on 24th   Nov 2014 for $ 247,500 and by 9th December 2014 you have not received a payment schedule and on 15 December 2014, you receive a payment of $ 135,000 accompanied by the Superintendent’s certificate.

You contact Rosen and they advise you that they only have to pay what the Superintendent certifies and that is what they have done.  
(a) Dave tells you he wants the whole of the claim.
(b) Is Rosen correct or can you ask for adjudication?  If you decide that adjudication is appropriate discuss how you would progress your claim up to and including your adjudication application. If you decide adjudication is not appropriate what alternative strategy would you suggest?
(c) If you were acting for Rosen describe how you would respond to the strategy outlined by you for Dave. In your answers please ensure you cite any time requirements and what the result of failure to comply with those time requirements would be.
6. Discuss the following:
• The conditions required for discharge by frustration.
• The meaning of, and the conditions required for, the innocent's party to terminate as a result of:
o Breach of an essential term.
o Breach of an intermediate-term.
o Breach of a warranty.
o Repudiation of contract.
• Discuss the standard you must reach when you issue a notice of termination.
• Describe what is required in a show cause notice.  
• If the other party breaches the contract what are the dangers to you in ignoring the breach. What would be the best strategy if you wished to accept the breach. What would you do if you wished to continue with the contract?
7. In the situation described in case 1 you were delayed by the actions of the superintendent.
A. Dave asks for your advice and says given that this delay was not your fault do you have to incur any costs to mitigate the delay?
B. Irrespective of your advice in A, in the interests of maintaining good relations, Dave authorises the expenditure of $20,000 to mitigate the effect of the delay. The attempt fails. Your claim for this expenditure is denied by the superintendent. Advise Dave of your rights in this situation.
C. The superintendent then instructs you to accelerate to make-up lost time and refuses to pay your costs. What should Dave do in this situation? What are the requirements for a global claim to succeed?

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