Offering support when a project falls into delay

Facts

Client: Global financial services firm

Country: UK

Industry: Banking

Issues

The client required upgrade works to a Data Centre to be carried out under a JCT contract.

The contract, which allowed for the work to be completed in four sections, each with its own completion date, had to undergo several iterations. From the outset the contractor’s progress was slow. The client had a number of concerns including:

• The management and conduct of the contractor on-site
• The timing and frequency of IT shutdowns
• Health and safety issues following a fatal accident
• Progress of the project
• Its financial liability with the contractor

There were two key issues for Fenwick Elliott to consider. The first was the potential for an extension of time. The second issue concerned financial risks. Was the contractor being overpaid and could the client seek to levy liquidated damages?

Solutions

The solutions offered by Fenwick Elliott included:

• Advising on the best way to keep records;
• Developing a workable completion strategy for the project;
• Considering the merits of terminating the contract with the contractor;
• Providing professional delay analysis services;
• Appointing carefully instructed specialists including technical planners and a health; and safety expert to evaluate any potential claims; and
• Advising on insurance and indemnity matters.

Benefits

High-level discussions with management representatives of both parties enabled Fenwick Elliott to structure an agreement whereby the contractor could leave the project early and amicably.

This gave our client financial certainty that the dispute had been resolved, thereby avoiding the cost of potentially lengthy court proceedings, and allowed them to retender the remaining work of the project.

Our debrief report meant that our client learned valuable lessons for the future, including making its e-tendering and procurement processes more watertight.