CONTRACTS & CLAIMS

WHY SHOULD WE STUDY THIS CLAIM CASE?

It provides insight into the complexities The court's analysis of the arbitration
and challenges often associated with clause's scope and the arbitrator's
construction contracts between private authority sets a precedent for
firms and government entities. interpreting such agreements.

The case highlights the importance of clear the arbitration process and the arbitrator's role in
contractual terms and the potential consequences resolving disputes are elucidated, contributing to a
of delays and breaches. better understanding of alternative dispute resolution
mechanisms.
CONTRACTS & CLAIMS

REASONS AND CAUSES OF THE

1. Delay in Possession of Site: CLAIMS:
The Plaintiff contends that there was a delay
on the part of the Union of India in
providing possession of the construction 4. Stipulated Timeframe Not Met:
site. This delay is claimed to have resulted
in difficulties for the builders and increased The builders claim that they were unable to
costs. complete the construction within the
stipulated time frame (by July 20, 1971) due
2. Delay in Supply of Drawings: to the mentioned delays and disruptions
caused by the Union of India.
The builders assert that there were delays in
the supply of necessary drawings by the
Union of India, contributing to a disruption 5. Government's Subsequent Tender:
in the construction process and additional
The Plaintiff highlights that the Union of
expenses.
India, subsequent to the ongoing
construction, invited tenders for the fifth
3. Suspension of Work: and sixth floors of the same building. The
builders were successful in this tender
The Plaintiff states that there were instances
process, but the rates quoted were
where the work had to be suspended due to
significantly higher than the initial contract
acts and omissions of the Union of India,
rates. The builders seek compensation based
further impacting the progress of the
on the difference between the rates of the
construction and leading to increased costs.
two contracts.
CONTRACTS & CLAIMS

WHAT TRIGGERED THESE CAUSES AND WHY

THESE CAUSES HAPPENED:
1.Delay in Possession of Site: 2. Delay in Supply of Drawings: 3. Suspension of Work:
Trigger: The delay in providing possession of the Trigger: The delay in supplying necessary drawings Trigger: The suspension of work may have been
construction site may have been triggered by might be due to administrative or procedural issues triggered by specific acts or omissions by the Union
administrative or logistical issues on the part of within the Union of India's departments responsible of India, such as changes in project plans, policy
the Union of India. for providing such documentation. decisions, or external factors affecting the
Reasons: Administrative inefficiencies, Reasons: It could result from internal delays in construction site.
bureaucratic processes, or unforeseen processing and approving drawings, changes in Reasons: Unforeseen events, legal or regulatory
complications in clearing the site for construction project requirements, or challenges in coordination changes, or disputes between the parties involved
could have contributed to the delay. between different departments involved in the project. could lead to the suspension of construction work.

4. Stipulated Timeframe Not Met: 5. Government's Subsequent Tender:

Trigger: The failure to meet the stipulated timeframe
could be directly linked to the delays in possession of
the site, supply of drawings, and suspension of work.
•Reasons: Cumulative delays and disruptions caused
by the Union of India's actions or inactions would
have contributed to the builders' inability to meet the
agreed-upon completion date.
Trigger: The decision by the Union of India to invite tenders
for the fifth and sixth floors while the initial construction was
ongoing triggered a potential conflict in rates.
Reasons: The decision to invite separate tenders could be due
to changes in project requirements, expansion of the original
scope, or budgetary considerations. The subsequent higher
rates quoted by the builders may reflect increased market
prices or changes in project specifications.
CONTRACTS & CLAIMS

CAUSE AND EFFECT ANALYSIS:

1. Delay in Possession of Site: 4. Stipulated Timeframe Not Met:
Effect: Builders unable to commence work Effect: Failure to meet the 18-month
within the stipulated 15 days. completion deadline.
Subsequent Effects: Subsequent Effects:
• Construction timeline disrupted. • Potential penalties or consequences as
• Potential increase in construction costs per the contract.
due to prolonged project duration. • Builders' reputation may be affected.

2. Delay in Supply of Drawings: 5. Government's Subsequent Tender:

Effect: Hindrance to the construction Effect: Introduction of a new construction
process. phase during the ongoing project.
Subsequent Effects: Subsequent Effects:
• Builders face challenges in planning and • Builders face the challenge of
execution. concurrent work.
• Work may need to be adjusted or halted • Potential impact on project costs and
until necessary drawings are provided. resources.

3. Suspension of Work: Overall Effect:

Effect: Halting of construction activities.
Subsequent Effects:
• Further delays in project completion.
• Increased costs due to resumption and
reorganisation of work.
Builders' Claim for Compensation:
Cumulative impact of delays, disruptions, and additional work.
Effects:
• Builders claim 45.21% over the contracted rates.
• Claim for Rs. 8,18,136.89 additional payment.
• Arbitration process initiated.
CONTRACTS & CLAIMS

CONCLUSION
The delays in possession, supply of drawings, and suspension of work collectively led to the
failure to meet the stipulated timeframe. The subsequent tender for additional floors introduced
further complexity. As a result, the builders incurred additional costs and sought compensation
for the impact on the project timeline and increased workload. The claim, in essence, reflects the
cause-and-effect relationship between the Union of India's actions and the builders' financial and
operational challenges.
CONTRACTS & CLAIMS

THANK YOU

23020344021 - Anurag
Deshmukh
23020344030- Kapil Kumar
23020344041- Mudit Sharma
23020344046- Rugved Penkar