1 / 16

FIDIC 2005 Beijing Workshop 13 Design - Build

FIDIC 2005 Beijing Workshop 13 Design - Build. Opportunities and Challenges in Australasia. Tony Barry, President Association of Consulting Engineers Australia Director Connell Wagner Pty Ltd. Project Delivery. Traditional Construct Only Design & Construct (D&C)

gautam
Download Presentation

FIDIC 2005 Beijing Workshop 13 Design - Build

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. FIDIC 2005 BeijingWorkshop 13 Design - Build Opportunities and Challenges in Australasia Tony Barry, President Association of Consulting Engineers Australia Director Connell Wagner Pty Ltd

  2. Project Delivery • Traditional Construct Only • Design & Construct (D&C) • Design, Construct & Maintain (DCM) • Build Own Operate (BOO) • Build Own Operate & Transfer (BOOT) • Public Private Partnerships (PPP) • Alliances

  3. Design & Construct • Design-Build = Design & Construct • There is a D&C Contract embedded in every PPP, BOOT, BOT, DCM contract • D&C is the most common form of project delivery in the Building, Urban Infrastructure and Power Generation Markets in Australia • Construct Only Contracts most common in NZ, D&C increasing

  4. Roles for the Consulting Engineer in D&C • Owner’s Planner and Engineer • Banker’s Engineer • Contractor’s Designer • Contractor’s Verifier • Proof Engineer (Principal & Contractor) • Construction Verifier (Principal & Contractor) • Independent Reviewer (Principal & Contractor)

  5. Why Design & Construct ? Initially • Reduce claims by contractors against Principals • Innovation without risk • Larger projects – contractors perceived with greater capacity to manage than government • Speed of Delivery • Cost and program, both risks to politicians

  6. Why Design & Construct ? Now • Total risk transfer from Principal to Contractor – very few claims • Innovative Solutions • Successful delivery, great projects • Even larger projects • Speed of Delivery • Projects delivered in one political term

  7. The Risk Environment for Consultants • Legal framework – Common Law, Contract Law, Trade Practices Act, Occupational Health & Safety Acts • Onerous Agreements • Contractors capacity • Contractors plan to deal with commercial loss

  8. The Risks • Client risk dumping • Risks inherent in Design & Construct • Tender process suppresses risk $ • Client Information risk • The risks are commercial risks • Losses crystalise in the D&C team • Contractor has no avenue to claim against client • Claim against consultant • PI cannot support commercial risks

  9. Onerous Terms • High standards of care • Responsibility for client supplied information • Absolute Fitness for Purpose warranties • Strict compliance • Open ended Indemnities • Duty of Care to multiple parties • Liability for delays outside control • Disclosing terms of PI Policy

  10. The Solution • Don’t accept unreasonable terms – walk away • Negotiate a good contract to maintain a good relationship and a good business • Use Limits of Liability above which Clients carry the risk • Adopt commercially sustainable PI Insurance levels and guidelines • Negotiate scope carefully and exclude others’ responsibilities

  11. The Future • More Design & Construct • Bigger projects • Fewer contractors • Higher cost to Principals • More work and more opportunity for Consulting Engineers • More claims and litigation • Better risk management by all parties

  12. Better Risk Management • Open identification and pricing in tenders • Risk sharing with agreed specified outcomes • Limitation of liability for contractors and consultants • Risk management record and tender evaluation criteria

  13. Design & Construct Business Model Principal Total Risk Transfer D & C Contractor Risk Transfer Risk Transferred or Managed Subcontractors Consultant

  14. Contractor–Consultant Liability Transfer Model • Master – servant relationship • Head contract conditions passed down • Risk transfer through onerous terms • Impossible and impractical notice requirements • Representations designed to create TPA breaches • Certify compliance or breach contract • Excessive and protective administration • Aggressive and manipulative behaviours • Designers site role suppressed / limited • Post-contract claims and disputes • Careers destroyed

  15. Contractor–Consultant Liability Managed Model • Co-operative integrated relationship • Methods of managing Head contract conditions agreed without transfer to consultant • Consultant carries negligence risk • Consultant assists Contractor to identify and manage risks • Contractor to certify compliance or non-conformance • Consultant to retain independent judgement • Consultant uses Contractor administrative systems • Co-operative behaviours and excellent performance • Designers site role expanded and integrated • Post-contract awards • Careers enhanced

  16. Tony Barry Connell Wagner Pty Ltd on behalf of Level 12, 75 Miller Street | North Sydney NSW 2059(02) 99224711 | www.acea.com.au | acea@acea.com.au

More Related