A programme has not been accepted or rejected – where does this leave the Contractor?

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A programme has not been accepted or rejected – where does this leave the Contractor?

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A programme has not been accepted or rejected – where does this leave the Contractor?

5 September 2010 5:21
A common question I hear is what happens if a programme is not accepted – is it “deemed accepted” if the Project Manager does not respond by the end of the two weeks stated in the contract? Well the very simple answer to this is NO! There are no deemed acceptances in the contract at all (with the exception of three instances which are new clauses to NEC3 associated with compensation event notifications and acceptance of quotations). I can not emphasise enough that it is as important to both Contractor and Employer that there is a recent Accepted Programme in place. Without this there will be a much more subjective argument as to what the effect of an individual compensation event is. Where there are multiple compensation events that you progressively can not agree these tend to build up making it even harder to agree future programmes issued for acceptance, which then descends into the traditional “bun-fight” at the end of the project in terms of what the entitlement is in the movement of the Completion Date and what the final account should be. This is exactly what the contract is trying to avoid, by putting in mechanisms to agree matters for the life of the contract. So where does this leave the Contractor if you have not had a programme accepted? The contract is very specific that you reference back to the last Accepted Programme with regards to assessing the effect of progress and change on the project. If it can not be deemed accepted, then what recourse does the Contractor have? I summarise my advice to each party as below: Contractor: 1. Make sure that the issued programme is fully compliant to clause 31.2 leaving little room in your eyes for not being accepted (easy to say I know…) 2. Ensure that the distinction between planned Completion and Completion Date has been correctly ascertained and represented 3. Issue a programme narrative (or statement) with every programme explaining the headlines since the last issued and detailing why the planned Completion is where it is. 4. Call a programme review meeting to talk through the key points associated with the revised programme and jointly review the critical path of the project. This should facilitate a quick decision from the Project Manager as to whether this is a programme that he can accept. 5. If it is not responded to within the period then this is actually a compensation event under clause 60.1(9) and can be notified as such. Whilst this will not have a specific financial gain to the Contractor as they will not have stopped work due to non-acceptance, it should up the anti with the Project Manager to get the matter resolved and get back on track in terms of an accepted programme. Employer 1. Review the programme and either accept or not accept well within the two weeks stated in the contract – like any of the timescales these are maximum periods to respond, not how long you should take. 2. If it is not accepted then give very clear reasons as to the specifics of why not – so the Contractor then has a chance to put things right within a new submission. 3. I strongly advocate an “acceptance with comments” if there are small issues that the Project Manager would like changed or altered or developed in a future submission, but are not specifically causing a problem in the programme now. This prevents a Contractor changing a few things and resubmitting, and in that time frame a few more small issues come up and very quickly the programme has not been accepted for a long period. I am aware of one programme that was not accepted because of a spelling mistake!!! Do you think this is a valid reason for non-acceptance under clause 31.3???
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Re: A programme has not been accepted or rejected – where does this leave the Contractor?

5 September 2010 5:21
In my experience, once the costs have started to escalate, the Employer / Project Manager do not want to accept a programme that could be financially embarrassing, they therefore prevaricate over anything until the project is completed when they try and usually succeed, in "doing a deal" with the contractor, who does not want years of adjudications which will cost him money and then possible litigation. This in my experience usually favours the Employer which is what he has been aiming for all along. The only way to counter act this would seem to be adjudicate early, but where does that leave the " spirit of mutual trust and co-operation". I am often considered to be too aggressive as I try and exercise by full rights and entitlements under the contract; every contract I have worked on where the Contractor has tried to play "Mr. Nice Guy" to the Employer, not used the contract properly to ensure their entitlement and expected the Employer to do the same, has resulted in the contractor losing out. Ensuring all notices are submitted and that you maximise the potential recovery is the only way to run the contract, if you want to keep in the Employers good books, the contract does not say you have to apply for your full entitlement, but if you havent gone through the right processes you almost certainly will not get it.
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Re: A programme has not been accepted or rejected – where does this leave the Contractor?

5 September 2010 5:24
What is the Contractors recourse if the Project Manager just ignores the programme issued for acceptance and neither accepts it nor rejects it. My experience on a couple landmark projects is that is often what happens. The contract may state that he does one or the other, but there is no recourse if he doesnt. At least if he rejects it, you can if necessary adjudicate.
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Re: A programme has not been accepted or rejected – where does this leave the Contractor?

24 October 2010 12:59
Another option is to force the Owners hand, by sending a letter that states, in effect, that (a) the contract requires the Owner to review the baseline submittal and return a verdict on it within a reasonable length of time, and that (b) unless a response is received that either accepts the schedule or rejects it for specific reasons, then further silence will be construed as Acceptance. Should the project later end up in court over issues that require schedule-based positions, this "speak up or forever hold your peace" letter will most likely establish the submitted baseline as "construdtively approved."
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Re: A programme has not been accepted or rejected – where does this leave the Contractor?

3 December 2010 7:56
Agree with Woolf,  Submitted project documents - Programs, Drawings , Method Statements, Letters are construed as agreed by all parties unless reservations are put forth within the stipulated time frame agreed in the Contract. Not raising any reservations, amounts to acceptance of the submitted program and shall be treated as such for its utilization on the project for progress measurement and contractual purposes. ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Last Edit: 10 years, 1 month ago by Bala. Reason: (NULL)
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