The assessment of a dredging projects soil conditions are the most important factor to determine dredgeability, the choice of suitable equipment, production rates and ultimately the associated investment for the works.
A prudent tenderer when analysing the site data needs to be assured that the data has been collected and prepared by a competent soil investigation company in accordance with relevant international standards such as BS, ASTM or others.
Rather than rely on the basic adverse physical conditions clause in the case of significant capital works involving excavation of varying subsoil, weathered or solid rock it is suggested to apply reference conditions in the Contract based on the actual information from the soil survey transposed into production rates which can be easily measured and reviewed, beyond which the Contractor is entitled to claim for additional compensation. Of the contracts available for use on dredging contracts only the FIDIC 1999 Red Book and the UK's NEC 3 Engineering and Construction Contract deal with the broad concept of reference conditions.
The concept of how adverse physical conditions are dealt with verges on the holy grail of marine infrastructure projects. On the one side they are part of a Marine Contractors 'must have' clauses whilst it is often viewed by Clients as the equivalent of a 'get out of jail free' card. The balance of risk has been hotly debated and fought over the years with the results little published or revealed due to disputes being resolved in arbitration or adjudication.
Added to this mix are the notion of unforeseeability and what an experienced contractor can expect its no wonder that the vast majority of marine infrastructure claims revolve around the issue of sub-surface conditions.
Even a full-scale and technically perfect soil investigation can only test a fraction of the volume that is to be dredged by the Contractor. Combined with the fact that natural conditions like rock strength, grain size, permeability, plasticity, presence of rock outcrops or boulders (to name a few) vary enormously, it is no wonder disputes on dredging contracts often focus on soil conditions that are claimed to be different from what "an experienced Contractor could reasonably have foreseen" .
The basic principle of adverse physical conditions this that a contract clause will give the Contractor the "right to claim for additional time and money in case unforeseeable physical conditions which may occur, which were not reasonably foreseeable by an experienced contractor". This simple principle is present in one way or the other in virtually every dredging contract.
A dual purpose lies hidden behind this contract principle, namely to :
Compensate the Contractor for encountering conditions more severe than could be derived from investigations available at the time of preparing his offer. Employers must not and should not expect the Contractor to gamble: Taking a risk provision covering for every imaginable situation would make an offer non-competitive, whereas the absence of a risk provision is a denial of the fact that dredging has significant uncertainties by its very nature. Employers tend to be overly biased towards achieving the lowest contract price for their work by passing all conceivable risk to the Contractor whether he is in a position to dealt with it or not.
Protect the Employer from Contractors who may try to claim additional compensation for interpretation or calculation errors mistakes made by the Contractor and resulting in a loss on the project. A loss in itself is no justification for additional compensation, and furthermore the Employer has very limited possibilities to assess the factual cause of the loss. In between the relative simplicity of the two extremes lies a gray area, and it is here that disputes are generally fought out. The author supports the view that a sufficiently high threshold for additional compensation should be present, balancing the interest of the Employer (by not having to battle over every minor issue) and of the Contractor (by having capped his risk and defined additional compensation above threshold). It is further suggested that a risk matrix framework could be established to assess the magnitude of the additional compensation before award of the contract. - 30297
A prudent tenderer when analysing the site data needs to be assured that the data has been collected and prepared by a competent soil investigation company in accordance with relevant international standards such as BS, ASTM or others.
Rather than rely on the basic adverse physical conditions clause in the case of significant capital works involving excavation of varying subsoil, weathered or solid rock it is suggested to apply reference conditions in the Contract based on the actual information from the soil survey transposed into production rates which can be easily measured and reviewed, beyond which the Contractor is entitled to claim for additional compensation. Of the contracts available for use on dredging contracts only the FIDIC 1999 Red Book and the UK's NEC 3 Engineering and Construction Contract deal with the broad concept of reference conditions.
The concept of how adverse physical conditions are dealt with verges on the holy grail of marine infrastructure projects. On the one side they are part of a Marine Contractors 'must have' clauses whilst it is often viewed by Clients as the equivalent of a 'get out of jail free' card. The balance of risk has been hotly debated and fought over the years with the results little published or revealed due to disputes being resolved in arbitration or adjudication.
Added to this mix are the notion of unforeseeability and what an experienced contractor can expect its no wonder that the vast majority of marine infrastructure claims revolve around the issue of sub-surface conditions.
Even a full-scale and technically perfect soil investigation can only test a fraction of the volume that is to be dredged by the Contractor. Combined with the fact that natural conditions like rock strength, grain size, permeability, plasticity, presence of rock outcrops or boulders (to name a few) vary enormously, it is no wonder disputes on dredging contracts often focus on soil conditions that are claimed to be different from what "an experienced Contractor could reasonably have foreseen" .
The basic principle of adverse physical conditions this that a contract clause will give the Contractor the "right to claim for additional time and money in case unforeseeable physical conditions which may occur, which were not reasonably foreseeable by an experienced contractor". This simple principle is present in one way or the other in virtually every dredging contract.
A dual purpose lies hidden behind this contract principle, namely to :
Compensate the Contractor for encountering conditions more severe than could be derived from investigations available at the time of preparing his offer. Employers must not and should not expect the Contractor to gamble: Taking a risk provision covering for every imaginable situation would make an offer non-competitive, whereas the absence of a risk provision is a denial of the fact that dredging has significant uncertainties by its very nature. Employers tend to be overly biased towards achieving the lowest contract price for their work by passing all conceivable risk to the Contractor whether he is in a position to dealt with it or not.
Protect the Employer from Contractors who may try to claim additional compensation for interpretation or calculation errors mistakes made by the Contractor and resulting in a loss on the project. A loss in itself is no justification for additional compensation, and furthermore the Employer has very limited possibilities to assess the factual cause of the loss. In between the relative simplicity of the two extremes lies a gray area, and it is here that disputes are generally fought out. The author supports the view that a sufficiently high threshold for additional compensation should be present, balancing the interest of the Employer (by not having to battle over every minor issue) and of the Contractor (by having capped his risk and defined additional compensation above threshold). It is further suggested that a risk matrix framework could be established to assess the magnitude of the additional compensation before award of the contract. - 30297
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