The construction industry in the Netherlands is not adversarial by nature, thus, many Contractors proceed on the basis of "execute a good job and we’ll get paid at the end". This has been the norm but times and attitudes are changing.

THE introduction of new commercial and contractual conditions and the advent of large consortium contracts means that Contractors are having to adopt a tougher line. In the present climate claims are increasing, as is recourse to formal dispute resolution.

The major cost of litigation lies in any prolongation and delay endemic to the proceedings themselves. The largest cost to be experienced in arbitration is, however, the time taken to assemble and collate all the necessary information. The remedy lies largely with the Contractors themselves and, more particularly, with the Engineers, who need to ensure that the time to be taken for the formulation of the necessary documentation is minimised.

In practice, despite the advent of information technology, and the simple techniques and the vast cross referencing capability now available, what is often found too often is that:-
• the estimate does not make sense,
• the base programme is no more than just a picture to ‘obtain the job’,
• the project procedures are such that information is not easily available in the format required, when it is actually required.

Thus, the initial paperwork does not provide the source and is not the suitable foundation required on which to build the dispute documentation.
To overcome this problem, the larger international contracting organisations employ a few in-house Quantity Surveyors, Contract Engineers and Planners or ‘Consultants’. Such personnel are employed to properly administer contracts by issuing notices, applying for extensions of time and preparing and presenting applications for payment for variations arising under the contract. The intention is that this will hopefully avoid disputes and, therefore, any formal arbitration or litigation.
Where claims are inevitable, the Consultants then present the Contractor’s claims. More than likely, this information will have been relayed to them by an Engineer. Therefore, the claims as submitted are rather general in content, sometimes even global and do not necessarily represent the detail necessary for resolution by formal arbitration.
However, it is not often appreciated that, whilst these Consultants may be well versed in routine quantity surveying, planning or contract management, they are not necessarily skilled in the resolution of disputes. Should the matter proceed to arbitration then the Consultant may be required to prepare an ‘Expert’ claim. However, it is also often unacceptable to the Arbitrator for these Consultants to act as an Expert Witness because of the close association with the commercial considerations involved in the project. It may, therefore, become necessary to appoint a second Consultant or an Expert skilled in matters of dispute resolution. This duplication of effort can be expensive.

If the Expert is not brought in early enough, the case may already have been pleaded, and may even have been prepared on the basis of the original consultant’s opinions. If this is the case, the Expert is faced with adopting the consultant’s work and, hopefully, endorsing it. If the Expert disagrees with it, the cost and delay implications can be substantial.
The Expert will be required to undertake an extensive forensic exercise, reconstructing particular aspects of the project, based on the documentation and his own judgement. In general, a construction Expert’s role is to come to terms with an overwhelming mass of detail and to present a clear and credible overview.

Sometimes a draft Expert’s report, once shown to key witnesses has led to improved recollections and greater understanding of the project and this can significantly alter opinions. This is common, for example, in the use of "Critical Path Methodology" ("CPM") in analysing delays to a project. The CPM is an excellent visual method of illustrating the way in which a project has been delayed. The preparation of a CPM analysis can be regarded as a logical exercise. However, the notion that the CPM is a method of proving the way in which a project was planned and delayed is, of course, incorrect. The CPM programme will be a snapshot of the project at a particular date. Consequently, the choice of the date is particularly important. The selection of the activities to be shown on the programme (and the way in which they are described) can substantially alter the ‘story’ that the programme tells. A major project at ‘level 3’ may have as many as 6,000 individual activities. Any presentation showing each and every activity would be unnecessarily complex.
Consequently, individual activities are ‘hammocked’ into groups to present a smaller number. This can disguise or emphasise the extent of delays attributable to particular causes. All such matters are subjective and affect the way in which a delay or influence is applied to the programme. If the activities are independent of each other, the consequences of a delay are very different than if the same activities were linked.

With a few exceptions, an experienced Expert Planner has to exercise his own judgement in selecting the various determining features of his CPM network. He is heavily reliant on actual information about the project (without which a perfectly logical CPM may bear no resemblance to reality) and his own judgement.

Paramount to his these efforts, however, is the existence of a logical programme, constructed at the outset.

In summary, there is a need to concentrate on the paper and administrative processes from the outset. This would, in turn, control the time and, therefore, the cost of Experts. This concentration needs to come from the Engineers utilising IT tools and developing skills and techniques which will support and demonstrate the Contractor’s arguments and theories.

There is no need for Engineers to become expert in the law but there is a need to spend a day or two learning about basic commercial awareness.
Sadly, Barry Kirby has passed away since writing this article. Any queries regarding this article or our operations in the Netherlands should be directed towards John Lott of our Netherlands office