Case Study

Question 1

You mention that your company were appointed on the project since 2020. Was this highlighted as a risk?

Answer 1

• Following the decision to retain the drainage at the end of Stage 2, the risk of reusing the drains was included on the projects risk register.
• The risk register identified the risk, as well as outlining the potential implications of these were not able to be reused (commercially, programme and value)
• It also proposed a mitigation measure, which was to undertake a CCTV survey as soon as possible to ascertain the condition of the drains as soon as possible.

Question 2

How did you quantify the risk of the drains, prior to undertaking the CCTV survey?

Answer 2

• It was assessed from a cost, programme and value perspective. The risk was assessed on the assumption that the drains were not suitable for reuse at all. This was undertaken prior to PCSA negotiations
• Commercially, advice was sought from the cost consultant who provided an indicative commercial cost for installing a new drainage solution solely within the building demise. They indicated that the additional works could cost upwards of £2m.
• From a programme persepctive, an analysis was undertaken in combination with the projects M&E consultant, who confirmed the required scope of works. This was undertaken by my Director who estimated it could lead to an additional 3-month programme prolongation.
• Value wise, the Architect drew up the area impacts of the alternative solution, which confirmed a total sqft loss. Conversations were held with the leasing agents and the Client to ascertain the impact this would have on the projects value.

Question 3

Why did you undertake CCTV surveys before December 2023, if you knew it was such a risk?

Answer 3

There were two main reasons:

(1) Vacant Possession of the building was acheived in late December 2022, which meant that it was not possible to undertake any surveys as we did not have possession of site.

(2) NWR confirmed that any works within 3m of the OLE required full isolations and possessions. There were no such isolations available prior to December 2023, when a one day blockade was in place over Christmas.

Question 4

Given the works were non-intrusive, did you ever think to do the initial surveys without NWR approval?

Answer 4

No, this was never a consideration, as I felt it would contradict with the RICS Rules of Conduct. Namely, it would not be acting with (1) Integrity, and (2) would not promote trust in the profession.

It would also put my Client at risk if anything went wrong, which contradicts rule 3, which is ensuring good quality output.

It also would not comply with the RICS ethical decision making tree, as I would not be able to justify this externally, could be deemed illegal (as it contravened the Basic Asset Protection Agreement) with NWR, and I would not be happy if it was made public (even if the works were undertaken succesfully).

Question 5

Why did you not seek to get the Main Contractor to take on the risk as part of their scope of works?

Answer 5

This was discussed during the PCSA, however the Main Contractor was not willing to take on the risk. This was because they did not feel they had adequate information to effectively price the risk, and therefore would not take the risk for this scope of works.

Question 6

How did you tender for the drainage contractor?

Answer 6

• A normal tender procedure was followed (i.e. compilation of tender information, form of contract, tender interviews, mid-tender interviews, evaluation and recommendation)
• However, there were some proscriptive requirements when it came to defining the tender shortlist, specifically:

(1) Contractor had to be NWR approved, in order to undertake works on or near the OLE.
(2) Contractor had to have adequate PLI at £50m, which was a NWR requirement under the Clients Basic Asset Protection Agreement

• This meant that there were only three contractors who passed the PQQ process.

Question 7

What contract did you use to undertake the works? Why was this Contract used?

Answer 7

• A JCT Minor Works Contract was used to capture the works. This was assessed against the JCT Intermidiate Works Contract, as well as capturing under a normal appointment contract.

This was chosen because:

1) Contract value was less than £500k
2) Works would be undertaken in 4 days
3) Did not require any contractor design (save for the use of a podium scaffold tower)
4) Contained provision for insurance requirements, and established the risks between both parties.

Question 8

How did you establish what options were going to be assessed?

Answer 8

Following the receipt of the survey, I instructed the design team and the CCTV contractor to provide a list of alternative options.

I ensured each consultant / contractor were effectively briefed on the requirements, and what the client was seeking to acheive (i.e. ensuring that waste and water could be removed from the south core to the shared sewer on Bishopsgate)

Question 9

Were any other options presented?

Answer 9

No, there were variations of each of the options, however themeatically, these were the only three available alternatives.

There were suggestions that different pipework routing for option 3 could be proposed (i.e. the diverted pipework would exit the buildings facade and enter the basement and sewage externally) however this was discounted as it would have had a planning implication.

Question 10

How did you establish the assessment criteria?

Answer 10

• I consulted the project brief, to ensure that the clients fundamental objectives were at the forefront of the criteria.
• This particular issue inherently related to the clients commercial, programme and value KPIs, which were fundamental to the project brief.
• I also ensured that context specific criteria were established, insofar as they impacted the clients core objectives (namely the requirement for NWR to approve the works, which could have an impact on programme).
• I also ensured that I did not establish the criteria in isolation. I discussed it with both my Director and the Client team to ensure they were in agreement with the criteria I established.

Question 11

Were any other criteria discussed?

Answer 11

Other criteria were discussed, namely the service life that each option would result in.

However, following discussion with my client, any option that did not come with a 20-year service life, or 12-year warranty was immediately discounted.

Question 12

How did you determine the weighting of each option?

Answer 12

• I assessed the project specific context, and the clients key drivers in close collaboration with the Client.
• I understood that the clients main focus was on programme and ensuring that the project completion date was met. This was because the client was letting the building to prospective occupiers at the time, and any delay could negatively impact the leasing progress.
• I proposed the weighting criteria to my Director, and following their agreement, presented to the Client who were in agreement.

Question 13

How did you establish what scored a 1 and what scored a 3 in the performance?

Answer 13

• I aimed to be objective as possible, and the assessment criteria conformed to this requirement. I wanted to remove any subjectivity as I’m aware this could negatively impact the success of the excercise.
• For example, it was only possible to secure a 1 or a 3 in the (1) Programme, (2) Third Party Approval and (3) Value criteria. This is because each option either could, or couldn’t acheive the clients objectives. I.e. it either did or did not result in an area impact.

Question 14

You mention that the cost for the adopted solution exceed the commercial value in the risk register – how did the Client react?

Answer 14

• The client was well briefed, and was aware of the importance of completing the works on programme.
• They were also aware of the fact that the works were going to have an inflated cost, as they were only possible to complete in Christmas leading to inflated costs generally.
• They were comfortable with the expenditure, as it would reduce programme risk and value implications, which were higher weighted criteria.

Question 15

What was the value implication of Option 3 if it were pursued?

Answer 15

• I have not undertaken any value based appraisals as part of my experience, so I did not undertake the analysis myself as it would have strayed outside of my area of professional competence.
• However, once the area impacts were presented, the Client confirmed it would have had a £3m value impact, based on current ERVs and yield data

Question 16

If option 3 were pursued, would any other works be required?

Answer 16

Yes, it would have required new capping on the previous gulleys, and screeding over the GF slab.

NWR did not require the existing pipework to be removed.

Question 17

What was the remaining service life of the other drains that were assessed?

Answer 17

As part of the initial CCTV surveys, the drainage contractor confirmed that they had a remaining servicable life of 20 years.

Question 18

Were there any amendments to the contract that you used?

Answer 18

There were two main amendments made to the contract:

(1) Limit of Contractors Liability - Under the amended JCT Minor Works there was no limit of liability. This was limited to 150% of the Contract Sum, noting the potential risks to the railway.

(2) Rectification Period - Amended to 12-months from 6 months, to reflect the fact that the blockades happen every Christmas, so facilitated a mechanism by which the Contractor could feasibly come back and undertake rectification works.

Question 19

You mention that failure to complete the scope would impact the Main Contractors programme, and cause a risk to the Client, how was this captured under the Building Contract you used?

Answer 19

Clause 2.27 of the JCT D&B Contract dealt with Relevant Events.

Under this, a named relevant event was delays caused by the Employer. If the drains were not in working order, this would constitute a Relevant Event, and would mean that the Contractor was eligible for an Extension of Time.

Question 20

What is a sump pump? How would this solution work?

Answer 20

A mechanical system used to remove water or waste from a low-lying area.

The system would collect waste and water, once it had reached a certain point, the pump would activate and divert it away from the building at high level.

Question 21

Talk to me about the issues with the specialist drainage contractor confirming their prices?

Answer 21

The drainage contractor were not able to confirm the costs for the water tankers in line with the programme (which assumed that a fixed price was confirmed 2 months prior to the works).

This meant that the cost consultant only had a week to review the costs of the works, as opposed to the two that I had accounted for in my programme.

Question 22

What is the breakdown of the JCT Minor Works Contract?

Answer 22

Section 1: Articles of Agreement - The identities of both parties, construction sum etc.
Section 2: Contract Particulars - Dates, damages, insurance etc.
Section 3: Conditions - The terms of the contract
Section 4: Execution of the contract