BUIL1287 Assignment QUESTION ONLY (2020)

School of PCPM, RMIT University
BUIL1287 Construction Contract Administration, HK Trimester 3 2020

Assignment (45% of Overall Assessment)
I. INTENDED LEARNING OUTCOMES

Upon completion of Assignment, students are expected to be able to:
➢ Evaluate variations;
➢ Comment on surety bonds;
➢ Assess interim payments
➢ Evaluate contracting parties’ positions in extension of time (EOT), loss and expenses (L&E),
liquidated damages and determination
II Rubrics for assessment:

The following rubrics will be used for assessing the final reports:
Content (90%) Reference list as the last page(s)

of the report (10%)
Unsatisfactory Little use of the concepts or Irrelevant resources referenced
Fail practices learned/ Does not
(<50%) demonstrate learning related to
course at all
Satisfactory Presentation of concepts or Relevant resources referenced
Pass (51-64%) practices without analysis
Good Previous criteria plus some logical Previous criteria plus the
Credit (65-74%) argument references are up-to-date
Very good Distinction Content with comprehensive and Previous criteria plus good
(75-84%) logical arguments derived from the citations, accessible references,
concepts or practices learned.
Note:
Unless otherwise specified, students must base on the un-amended HKIA Standard Form of Contract to
answer all questions.
III Assignment submission:

Assignment Due: 10TH JULY 2020 BY NOON (12:00PM)
You are to refer to the relevant School regulations in relation to late submissions. The submission must
include a standard cover sheet signed by all members of the group. An electronic version of the full
submission (including supplementary supporting data (as appropriate)) should be uploaded to the Canvas
on time. Due to the RMIT policy, late submission WILL NOT BE MARKED, unless students received a formal
special consideration approval that they should seek themselves through the central system.
NOTE: This is a group assignment. If you wish to have the contributions of group members assessed
individually, you must submit in your hardcopy a completed and signed Group Work Contribution
Statement.
Peter S.P. Wong / Ken Hui/ Joe Lee

1st January 2020
1
TASK 1 – Valuation of Variations (10%)
You are a consultant quantity surveyor working for a developer Joel Developers Ltd. (JDL) of a
proposed shopping mall in Yuen Long. In the original design Podium Levels 1 and 2 have false
ceilings. BrightBuild is the main contractor of the project.
Recently, the architect issued an instruction AI-01 to BrightBuild adding false ceiling to Levels 3 to
5. The standard and specification of the additional false ceilings are the same as Podium Levels 1
and 2. BrightBuild refused to use the B.Q. rate for assessment of the AI-01 based on the following
reasons:
1. The BQ rate was substantially underpriced because of the pricing error.

2. There were substantial increases in the total quantities of the false ceiling as a result of the
variation.
3. Although the additional false ceiling are the same type as to be installed to Podium Levels 1
and 2, the ceiling heights of Podium Levels 3 and 4 are 3 metres higher than that of as
Podium Levels 1 and 2
JDL seeks your advice on the followings:
[i] Support by relevant contract provisions, comment whether BrightBuild should be entitled a rate
higher than the BQ rate to finish the work.
[ii] The contractual implication of deleting all the ceiling works from the BQ and employing
another contractor to carry out this part of work.
TASK 2 – Surety Bond (10%)
You are a consultant quantity surveyor working for a developer Joel Developers Ltd. (JDL) of a
proposed retailed podium and residential tower in North Point.
Last week the main contract and some nominated sub-contracts were sent to the respective
contracting companies to sign up. However, you’ve just received a reply from the main contractor
(Prudent Contracting Ltd.) that he rejects to provide surety bond as stipulated in the contract
documents based on the reason that the amount of bond required was 10% of the Contract Sum. At
the same time, all Nominated Sub-contractors were required to provide surety bond with bond
amount at 10% of the Nominated Sub-Contract sum to the Employer. Prudent argued that there was
a duplication as their contract sum has included all the Prime Cost Sums for the Nominated sub-
contracts already.
The developer asks you to explain if you have made any mistakes in this issue. Draft a letter to
respond.
2
TASK 3 – Interim Payment (10%)
[a] Clause 32 of the HKIA Form sets out the following three major items that should be assessed/
and subsequently covered in the interim payment certificate:
i. The value of the work performed to the date of progress payment

ii. The value …… of the unfixed plant and materials”
iii. retention
As a consultant quantity surveyor working for the developer, describe the above items and
provide appropriate method(s) for assessing these items.
b) You are the government’s building department QS of a school redevelopment project in Tin Sui
Wai. The Main Contractor has just submitted the 4th progress payment application. Yet, HKIA
Form is adopted as the contract conditions of this project. The project duration is 18 months.
The latest programme indicates that the Main contractor has yet completed all structural work
as scheduled. As such, no finishes work can be kick-started next month. However, the Main
Contractor has delivered the materials of external wall tiles and bathtubs to the site. The Main
contractor requests for the material-on-site payment of these items in his progress payment
application. Draft a letter to the Main Contractor to explain contractually your decision on the
material-on-site payment request.
3
TASK 4 – LD, EOT, L&E and Determination (15%)
You are a quantity surveyor for Charlene & Gillian (C&G) consultant QS Ltd. Your company is
working for Nicolas and Faye (N&F) Developers Ltd. in a project to renovate a clubhouse located
at the penthouse of a luxurious service apartment at 883 Temple Street, China Town. The following
are the relevant contract particulars:
Original Contact Sum: $10 Million
Original Contract Period: 12 months
Contract Commencement Date: 1/10/2018
Contract Date for Completion: 30/9/2019
Liquidated and Ascertained Damages: $2000/day
By June 2019, the Contractor (Collins Contracting Co. Ltd.) had been in serious delay (on his own
default) with no entitlement to extension of time. According to the revised programme submitted by
Collins on 15/6/2019, his anticipated date for completion of the contract was 30/11/2019 (i.e. two
months delay was anticipated. The Architect had endorsed such revised programme after
examination.
On 22/6/2019, unfortunately there were suspected cases of Corona Virus amongst the residents of
the lower floors of the building. The building was subject to tight ingress/egress control by the
Health Department waiting for medical diagnosis of the patients. No construction work was
possible during the control period. The patient’s illnesses were later confirmed NOT relating to
Corona Virus and the control was lifted on 20/8/2019. The percentage value of work completed
upon suspension of work was 70% of the original contract sum.
On 21/8/2019, N&F, after reviewing the situation, instructed the contractor via the Superintendent
to continue suspension of the work until 22/9/2019. The work restarted on 23/9/2019
Today is 31/3/2020, your boss asks you to send him a full appraisal of the contractual and financial
positions of N&F. The appraisal should include your analysis about the Contractor’s entitlement to
extension of time and loss & expenses, the Developer’s liability of liquidated damages, the risk of
determination. You are expected to refer to the relevant provisions/conditions of the Contract to
support your analysis too.

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School of PCPM, RMIT University

BUIL1287 Construction Contract Administration, HK Trimester 3 2020

I. INTENDED LEARNING OUTCOMES

II Rubrics for assessment:

Content (90%) Reference list as the last page(s)

III Assignment submission:

Peter S.P. Wong / Ken Hui/ Joe Lee

1. The BQ rate was substantially underpriced because of the pricing error.

JDL seeks your advice on the followings:

TASK 2 – Surety Bond (10%)

i. The value of the work performed to the date of progress payment

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