A review of relief events and compensation events in private-public construction projects
Claims management remains an important skill to allow identification and evaluation and resolution of claims. In case they're identified timely, they may be avoided completely or resolved. If they’re not resolved, other dispute resolution techniques can be used to resolve the problems.
Whether it’s a fully government, semi government or a private project, claims dominate all types of construction projects. In semi government projects, the UAE Government officials seldom try to settle agreements as they might have to incur financial losses. The dispute resolution process is the default in the claims process that both parties must follow and comply with.
Whether its claims management or dispute resolution techniques, the best consultants can provide services for both. Opt for the experts in construction claims consultant Dubai and allow professional to take over your claims management for your construction projects. The article aims to highlight the time extension events in Private-Public Projects (PPP).
In a semi-government construction project, the extension of time allows the private partner limited events, for which the Private Party can claim compensation. The following article explains how the construction claims consultants deal with the different claims relevant to extension in time events read ahead to know more:
A limited number of events can be claimed against by the private party:
Both the events are relevant to the situation but outside the private partner’s control and will be discussed in the contract. In case of an extension of time in the circumstances mentioned, the private party has the incentive and can continue with the project. Compared to the initiation of a default process due to the event being beyond the private partner’s control, it provides better value for money option.
It is the responsibility of the government party’s contract management team to make sure that the extension grounds are in accordance with the PPP contract criteria and comply with the procedure mentioned in the contract. The following text differentiates between relief event and compensation events that can cause extension of time:
These are events that may arise during any stage of the Private Public Party’s contract and managed best by the private partners, though they may not be under their control. Force Majeure events like unforeseeable weather conditions are an ideal example of these events. For analysis, it’s important to hire construction claims consultant Dubai for they are important service providers to help classify the events that may have occurred.
Although the private partner is subjected to the financial risk; however, neither liquidated damages nor the termination rights arise since the date of completion is extended for the private party.
However, it requires, the PP to inform the government party about the occurrence of the relief event (specified in the contract) as soon as possible and within a defined period. The notice that is sent by the private party should:
If the government party isn't satisfied, it can request further information and justifications for extension of time. In case there is an agreement about the time extension, amendments in the PPP contract are imminent, and new dates will be recorded. However, Dispute resolution is needed in case of disagreement.
Private partners may be compensated in terms of time and money in the case of compensation events. Failure to provide the ‘right of way’ and any other delay by a government agency is an ideal example of such events.
The private party must do all steps mentioned for relief events and also:
A cost summary termed capital cost, should be given to the private partner. Along with operational costs backed by a revenue increase PPP contract time extension.
Overstated costs are a common sight in construction project claim, so it's essential to keep them in check. Mitigation costs should be considered to check how effective they are. Disagreements need to be resolved through the dispute resolution proceedings.
Regardless of the type of construction project, semi-government, government or private, construction claims during the construction phase are a common sight. Since the claims procedure is complicated, parties may often make grave errors.
To prevent mistakes and to allow rightful resolution of claims, regardless of the type of projects, opt for the best construction claims consultant Dubai and allow professionals to resolve your construction claims with the expertise and knowledge they’ve collected over the years.