TENDERING, BIDDING & CONTRACT MANAGEMENT

BY ANAND GOSAVI

CONTRACT MANAGEMENT CYCLE

PROJECT FORMULATION PRE TENDERING ACTIVITIES AWARD OF WORK EXECUTION OF WORKS COMPLETION & HANDING OVER DEFECT LIABILITY

PRETENDERING ACTIVITIES

PROJECT FORMULATION APPOINMENT OF CONSULTANTS/ ARCHITECTS AGREEMENT FOR CONSULTANTS FINALISATION OF SPECIFICATIONS ,SCOPE OF WORK BILL OF QUANTITIES PREQUALIFICATION OF CONTRACTORS PREQUALIFICATION DOCUMENT EVALUATION OF PRE QUALIFICATION DOCUMENT FINLISATION & ENPANALMENT OF CONTRACTORS

TYPES OF CONTRACS

PERCENTAGE RATE CONTRACTS ITEM RATE CONTRACTS LUMP SUM CONTRACTS LUMP SUM TURNKEYCONTRACTS/ DESIGN BUILT BOT BOLT

Contents

Percentage Rate/Item rate Tender notice Detailed Tender notice Methodology of tender submission General conditions of contract Special conditions of contract Agreement B1 form , clauses of contract Bill of quanities Specifications Drawings

% Rate contract: Detail BOQ, Rates . Payments on basis of quantities executed. Changes in drgs can be accommodated . Qty survey &payments is a hectic , time consuming job. Variations have limitations. Easy initially but not suitable for mass housing projects. Item Rate Contract: As above Rates are given by contractor, variation no problem Rates to be balanced.

Lump sum/Design Built

VOLUME I: - Conditions of Contract Tender notice Detailed Tender Notice Methodology of submission General conditions of contracts Additional conditions Agreement C forms, conditional clauses of contract. Various proformae VOLUME II: - Technical Briefs Site A) Architectural planning B) Architectural Aspects. Structural Design Criteria On site / Off site design criteria General Specifications Scope of work Monitoring Additional Specifications Detailed Drawings. VOLUME III: - Financial offer

C-Lump-sum: In this type of contract the contractors are required to give fixed rate / fixed sum for execution of work complete in all respects i.e. according to drawings, designs, specifications supplied to them with tender within specified time. (Departmental schedule of rates for various items of works are also provided which regulates the payment of contractor in respect of items of works added / deleted.) In this type of contract the detailed planning, design & drawings for work along with the specifications should be ready & should be final. As the rate is paid on sqft basis the exact idea of work to be carried out along with the foundation requirements & site details should be ready before the tender document is prepared. Extensive detailing is required in tender document for technical specifications & drawings. The schedule of payments detailing the part payment for each item of work, Portion executed is required to be prepared which cannot be standardized & differs from work to work. Since the payments are not made on measurements of quantities the changes in the drawings become very difficult, as their quantum cannot be judged readily. Since the payments are to be made on built up area basis detailed definition of built up area should be given. As to what shall be payable, as BUA for FSI purposes often allows various concessions, which are required to be incorporated in payable, built up area like, machine room, lift well, pump house etc. In this type of contract the important thing is to judge exact quantum of the work done by the contractor at a particular stage for payment of interim running bills. In absence of proper judgment the case of excess payments have occurred in past. The reason may be casual approach in working out quantum of work as no detailed measurements are records .It is therefore necessary to work out the system for calculation for quantum of work & get it approved from competent authority.

Lump sum Turnkey / Design & Built form: This type of the contract form is generally used mass housing projects, where the contractor apart from the execution of work also plan & design the work, i.e. client do not plan or design. This job is also done by the agency. However in this type of contract client must be able to detail out our needs specifically in regardsArchitectural Planning Brief. 2) Architectural Aspects Requirements. 3) Structural Design Criteria 4) On / Off Site Infrastructure Design Criteria 5) General Specifications 6) Scope of work. In this type of contract generally the bids are invited from selective agencies, which are prequalified for such types of projects The bids are invited in three envelopes: Documents Technical offer. Financial offer. The evaluation of technical Bid is Herculean task. The marks are given for each stage / requirements detailed out in Bid & the financial offers of only those who are found technically suitable are opened. This type of contract eliminates the need of appointment of architect for planning portion. The type of contract is easy to monitor since planning & requisite permissions are the responsibilities of the contractor & are well defined.

AWARD OF WORKS

SELECTING FORM & TYPE OF CONTRACT NOTICE INVITING TENDERS FINALISATION OF TENDER DOCUMENT PREBID MEETINGS TENDER OFFER WORKING TENDER SUBMISSION &RECIEPT VALIDITY OF TENDER EVALUATION OF BIDS FINAL SELECTION OF CONTRACTOR

CONTRACT MANAGEMENT & MONITORING OF CONTRACTS

MANAGING & ADMINISTERING CONTRACTS THE EMPLOYER, THE ENGINEER & THE CONTRACTOR PERFORMANCE SECURITY VARIATIONS AND DEVIATIONS TIME FOR COMPLETION, DELAY IN COMPLETION PENULTY, LIQUIDETED DAMAGES QUALITY OF WORK, DEFECTS & MAINTENANCE MEASUREMENT, VALUATION &PAYMENT Insurance HANDING OVER SITE BREACH OF CONTRACT FORCE MAJUARE SUBCONTRACTORS Escalation CLAIMS DISPUTES ARBITRATION

LAW OF CONTRACTS

Importance of the Law of Contract Nature of Contract Definition of Important Terms Different Kinds of Agreements Kinds of Contracts
Agreement and Contract Distinguished

Essential Elements of a Valid Contract An Agreement Becomes a Contract Void and Void able Contracts

FIDIC CONDITIONS OF CONTRACT

Conditions of Contract for Construction for Building and Engineering Works Nominated Subcontractor Staff and Labour Plant, Materials and Workmanship Commencement, Delays & Supervisions Test on Completion Employers Taking Over Defects Liability Measurement and Evaluation Variation and Adjustment Contract Price and Payment Termination by Employer Suspension & Termination by Contractor Risk & Responsibility Insurance Force Majeure Claim, Disputes & Arbitration

CONSTRUCTION CLAIMS

Introduction Preparation and Presentation of Claims Preparation of the Claim Basis of Claim Importance of Facts Supporting Evidence Drafting of a Claim Introduction Ground of Claim Substantiation of Claim Proving Damages Negotiating Settlement Preparing before Start of Negotiation Timing for Negotiation Strategy for Negotiation Communication and Bargaining Position Alternative Disputes Resolution Methods

ARBITRATION PROCEDURE

Introduction Appointment of Arbitrator Conduct of Arbitration after Appointment Evidence and their Importance Kind of Evidence Admissibility of Evidence Desirability of Reasoned Award Award of Interest by Arbitrator & Law Relating to Interest Making, Publishing and Implementation of Award

CONTRACTUAL RISK MANAGEMENT IN CONSTRUCTION PROJECTS

The Parties to the Risk The Employer (Client) The Contractor Consultant (the engineer) Delay in Drawing and Instructions by Client Errors in Client's Data/requirement

Right of Access to the Site Client's Claims Against Contractor Setting Out Errors Unforeseeable Physical Conditions Completion Test

Rejection and Remedial Work Delay Caused by Authorities Rate of Progress of Works Delay Damages Taking Over Parts of Works

Handling Over on Completion Extension of Defects Notification Period Failure to Remedy Detects Comments on (xiv and xv) Delayed Tests and Retesting Value Engineering Benefits

Price Variation Procedure

Charges in Legislation Delayed Payment Suspension of Work Force Majeure Indemnities