Wednesday, October 3, 2007

Panel PresentationCPPC Forum 2007, Calgary

Panel Presentation

Who is CCDC? Introduction to the “new” CCDC-2 Panel Presentation – Key Risks Q&A

Terry Brown – Contractor & CCA Rep

Gregory Hersen – Lawyer & Bar Assoc. Rep

Ron de Vries – Owner Rep

Who is CCDC?

Canadian Construction Association

Royal Architectural Institute of Canada

Association of Consulting Engineers of Canada

Construction Specifications Canada

Who is CCDC?

Public Sector Owners

Legal Representation Member - Canadian Bar Association

Private Sector Owners

CCDC Mandate

“CCDC is responsible for the development,

revision and improvement of Canadian

standard construction documents used by

Owners, Consultants, Contractors and other

participants in both public and private

sectors throughout Canada.”

Why Use CCDC Documents?

Relied on as industry standards. Provide balance, uniformity and

standardization for bidding and contract procedures.

Fair allocation of risks and protects the rights of all parties equitably.

Developed in collaborative environment. Unbalanced contracts increase risk of claims

and disputes. Industry wide endorsement - CCDC sells over

50,000 documents annually.

Document Development

1. Draft is prepared by working group

3. Draft is submitted to constituent organizations

2. Reviewed in detail by Committee

4. Final document issued for endorsement

What’s special about CCDC Documents?

CCDC Documents have endorsement from all of the constituent member organizations and are applicable to a broad range of construction industry use.

CCDC Documents CCDC 2 - 1994 Stipulated Price Contract CCDC 3 - 1998 Cost Plus Contract CCDC 4 - 1982 Unit Price Contract CCDC 9a & 9b - 2001 Statutory Declaration CCDC 11 - 1996 Contractor’s Qualification CCDC 12 - 1994 Project Financial Info CCDC 18 - 2001 Civil Works Contract CCDC 20 - 1994 Guide to Use of CCDC 2

CCDC Documents CCDC 21 - 2000 Guide to Construction

Insurance CCDC 22 - 2002 Guide to Construction

Surety Bonds CCDC 23 - 2005 Guide to Calling Bids and

Awarding Contracts CCDC 24 - 1996 Guide to Model Forms and

Support Documents CCDC 40 - 1994 Rules for Mediation and

Arbitration of Construction Disputes

CCDC Documents

CCDC 43 - 1998 Guide to Use of CCDC 3 CCDC 48 - 2002 Guide to Use of CCDC 18 CCDC 220 – 2002 Bid Bond CCDC 221 - 2002 PerformanceBond CCDC 222 - 2002 Labour & Material

Payment Bond

Documents Under Review CCDC 2 – Stipulated Price Contract CCDC 4 – Unit Price Contract CCDC 5A & 5B – Construction

Management Contracts CCDC 14 – Design-Build Contract CCDC 15 – Design-Builder/Consultant

Contract CCDC 20 – Guide to use of CCDC-2 CCDC 45 – Guide to Construction

Management CCDC 46 – Guide to Design-Build

CCDC Documents

Introduction to the new CCDC - 2

Overview:

Editorial updates to the 1994 version. Significant changes to key provisions.

Indemnification Waiver of Claims

Roll-out by end of 2007 CSC Training Sessions

CCDC 2: Stipulated Price Contract

Introduces concept of mutual indemnification between Owner and Contractor.

Consultant removed. Introduces limits of liability.

GC 12.1: Indemnification

CCDC 2: Stipulated Price Contract

Owner/Contractor Indemnify and hold harmless each other against

Nature of

the Claims

Monetary Limitation

Time Limitation

Direct Claims Insured and uninsured claims

Contract Price, but

no less than the greater of $2M and the insurance limit, and no more than $20M

Shorter of 6 yrs from the date of Substantial Performance of the work and provincial limitation statute

Third-Party Claims Relating to bodily Injury or Property Damage

Insured

Claims

No Limit

Uninsured Claims

No Limit

CCDC 2: Stipulated Price ContractEXCEPTIONS

Owner Indemnifies the Contractor

Nature of the Claims

Monetary Limitation

Time Limitation

Toxic/Hazardous Substances

Presence prior to the Work

No limit No time limitation

Infringement of a patent of invention

Supplied to the Contractor

No limit No time limitation

Lack of or defect in title

No limit No time limitation

CCDC 2: Stipulated Price Contract

GC 12.2: Waiver of Claims

Concept of mutual waiver Waiver period limit established – 6 days

before expiry of the lien period. Now Substantial Performance vs. Final

Certificate for Payment. Exceptions

Claim for which a lien may be asserted and others …

Panel Presentation – Key Risks

Contractors Perspective Timely & Full payment. Owner’s Consultant Team Contract Security & Insurance Mould Indemnification & Waiver of Claims

Panel Presentation – Key RisksLegal Perspective Qualified bids. Inappropriate use of supplementary

conditions to CCDC. Failure to keep proper documentation for

dispute resolution. Insufficient or inappropriate contract

security. Non-compliant bids. Inappropriate use of bidding processes, ie.

RFP’s v. Tenders

Panel Presentation – Key RisksOwner Perspective Quality of bid documents. Accuracy of estimates. Funding uncertainty and phasing. Attracting bidders. Qualified or non-compliant bids. Contractor performance – quality & time. Construction site safety – “constructor”. Contract changes. Contract completions.

Panel Presentation – Key RisksOwner Perspective Quality of bid documents.

Enhanced communication with A&E firms during the preparation of contract documents.

Bid-ability & build-ability reviews before tender.

Restricted amendments within 5 days of closing.

Panel Presentation – Key RisksOwner Perspective Accuracy of estimates. Funding uncertainty and phasing.

Currently a serious risk. Must factor in market conditions. Build in alternates to ensure award. Retain professional quantity

surveyors/estimators. Build in contingencies to project funding. Better understanding of the accuracy of

estimates.

Panel Presentation – Key RisksOwner Perspective Attracting bidders.

Ensuring adequate funds are available. Appropriate packaging of work. Using bid documents that are familiar to

the industry. Maintaining productive relationships. Ensuring payment. Track response to bids and follow-up with

plan-takers to find out why they did not bid. Provide bid documents to Association Plans

Rooms.

Panel Presentation – Key RisksOwner Perspective Qualified or non-compliant bids.

Waiver of non-compliance clause. Use industry standard documents. Ensure terms and conditions are appropriate

to the target industry. Pre-tender site visits and briefings.

Panel Presentation – Key RisksOwner Perspective Contractor performance – quality & time.

On-site inspections and QA program. Pre-qualification for specialized work. Bond or security for all contracts >$100K Mandatory schedule with progress

payments. Aggressive completion performance targets. Contractor Performance and Evaluation

Review (CPER) on 100% of contracts. Restricted bidders list.

Panel Presentation – Key RisksOwner Perspective Construction site safety – “constructor”.

Safety section in the contract documents to clearly define responsibilities.

Safety inspectors. Work closely with provincial authorities.

Panel Presentation – Key RisksOwner Perspective Contract changes.

Currently average 11% of contract award value.

Part of corporate performance measure. Rigorous scope management. Includes extension of time & costs if

warranted.

Panel Presentation – Key RisksOwner Perspective Contract completions.

Establish realistic completion dates in the contract.

Set corporate targets for timeliness of substantial and final completions.

Rigorous monitoring of schedule. Progress payments tied to schedule reviews. Early intervention for problem contracts. Use of contract funds to complete

deficiencies.