Introduction

The following report is on the new community center project that is owned by the local authority, the Employer. ABC Construct is the main construction contractor. CAD Architects are the Architect/ Contract Administrators, and QUSUV Surveyors are the Quantity Surveyors for the project. Both the Architect/ Contract Administrator and the Quantity Surveyor were appointed by the Employer and have separate contracts. The report contains the project introduction and background information. The introduction is followed by an initial section containing the roles of the quantity surveyors and the project administrators as outlined by the Joint Contacts Tribunal (JCT). An analysis of the project problem is carried out in order to discuss its ramifications. It also discusses the possibilities of getting different results if other actions are to be taken. In conclusion, the report seeks on the ways the internal administration systems can be improved to avoid a repeat of the problem in the future (Margaret & John, 2012, 20-36).

Project background

The Community centeris in a 50,680 gross square foot facility. The community center is located in a reclaimed land and is attached to Woodson Secondary School. The center is designed to offer the most exciting experiences to the members of the community to relax and socialize with each other. The center, which is still under construction, will boast of modern recreational machines and equipment upon completion. The recreational facilities include an auditorium, cafeteria, and a gymnasium. The Employer also put emphasis on installing the best educational facilities to be used by the Woodson Secondary School Student’s.

Architecture/ Contract Administrator

According to the JCT standard forms, the Contract Administrator (CA) role is to administer the building contract between the employer and the building contractor. Furthermore, the JCT outlines the following roles of the CA:

• The CA is required to chair meetings involving the project stakeholders.
• The CA gives information, which includes variation orders to the contractor.
• The CA determines all the applications made by the contractor for an extended time and authorizes interim payments to the contractor.

Although architects are historically thought to be the CA,other professionals can also act the role of a CA. Nonetheless, CAD Architects were appointed the CA in the community project Center (RICS information paper, 2000).

Quantity Surveyor

The community center contract is a standard building contract with quantities. JCT outlines the bill of quantities to be an estimation carried out by a quantity surveyor on behalf of the employer. The employer bears the risk of the quantities being accurate. For any errors that occur, a correction is made on the quantity and is treated to be a variation (RICS information paper, 2000).

Analysis of the problem

The JCT intermediate contract applies to projects that are simple and employ standard skills and trades. The employer, therefore, holds the risk for the accuracy of the valuation done by the appointed quantity surveyor. Before the commencement of the intermediate contract, the contractor carried out calculations pertaining to the value of the variation given by the employer. After confirming the values, the employer and the contractor agreed on the valuation made by QUSUV, the appointed quantity surveyor. The community center project then commenced after the architect/ contract administrator gave the instruction to commence (RICS information paper, 1998).

However, during the course of the project, the contract administrator passed on to the contractor incorrect information. The contractor went ahead with the construction of a section of the building using the information provided by the contract administrator. In the course of construction, the contract administrator realized the information they provided to the contractor was incorrect. Further construction would have affected the quality and safety of the on-going work. The contract administrator advised the contractor to pull down the section that had been constructed with the incorrect plans. An agreement was reached between the contract administrator and the quantity surveyor to carry out a fresh bill of quantities for the demolished section. After the quantity surveyor had finished the new bill of quantities, the contract administrator gave the contractor a go ahead to reconstruct the demolished section (RICS information paper, 1998).

During the period when the construction was halted, the contractor incurred losses. The contractor’s workers had no work and yet they were still receiving their pay. The time lost when the quantity surveying and the bill of quantities were being prepared was also significant. It would result to the project going past the expected completion date. The cost of demolition of the constructed section was massive. Special equipment had to be hired and brought in to undertake the demolition. The cost of hiring the demolition equipment had not been factored in the bill of quantities. The rubble and construction material waste that was a result of the demolition were carted away. The disposal of the material was within the environmental disposal laws of the local authority.

The new bill of quantities done by the quantity surveyor was significantly higher than the original one. As a result of the extensive work, the amount of money used for the construction work in March is £157,000. However, the valuation done by the quantity surveyor puts the amount at £86,500. There is a huge difference in the amount that is due for the payment of the work done and the valuation done by the quantity surveyor.

The £86,500 that is proposed by the quantity surveyor is not enough to sustain the remaining part of the project. The quantity surveyor in computing the valuation left out the demolition and re-construction costs. Thus, the amount left out prevents the contactor from performing the work. The main source of fund for the contractor is the ALTB bank. However, the bank has refused to give the contractor any more money. The contractor, therefore, cannot fulfill the obligations set out in the contract document. If the quantity surveyor does not include the demolition and reconstruction valuation, the contractor will become bankrupt and possibly lead to insolvency.

Recommendations

The contractor believes that there was a breakdown in the communication path. The company did not follow-up with the quantity surveyor. The company could have asked the quantity surveyor to include the cost of the demolition and reconstruction. The lack of a follow-up by the internal systems of the organization led to the omission of the later costs. This led to disagreements on what was to be done, when it was to be done, and how the project was to be carried out. There was also a difference in the quality of work, which both parties expected to be done. For work to be done effectively then it means that all the parties involved need to have an understanding on what needs to be done. Breakdown in communication means that one or more parties were not informed on the entire decision about what could be required. There are various people with different qualifications and responsibilities in the entire project. Therefore, the contract administrator should ensure that all the sections of the project are communicated with each stakeholder on time and effectively (Gregory & Rene, 2005, 42-60.).

There exists some level of disorganization in the company’s internal systems. The company should seek to have a buffer financial backing that will cushion the company against such occurrence. Relying on a single source of funds such as a bank is dangerous. Nonetheless, the company should explore other means of growing its cash reserve and ensure it has a healthy cash flow. The healthy cash balance will in turn ensure a cash flow that is able to sustain the running of a project even if such a situation reoccurs. The contractor’s company should designate a communication officer whose task is to communicate with all the other stakeholders of a project in a daily basis. The officer will update the partners on the work that is done by the contractor. The officer will also get to know the work currently undertaken by the other stakeholders (Gregory & Rene, 2005, 75-80).

The information provided in this report is correct and represents the situation that is taking place on the ground.

References

Gregory, A., & Rene R., 2005. Contract Management Organizational Assessment Tools. UK:     Penguin Books

Margaret, G., & John, W. 2012. Desktop Guide to Basic Contracting Terms, Seventh Edition.                 Chicago: The      University of Chicago Press.

RICS information paper, 2000. The management of risk, RICS information paper, RICS Books:   Coventry.

RICS Information paper, 1998. Standard method of measurement for building works (SMM7),      RICS Books: Coventry.

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