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Understanding Delay Claims: Looking Beyond the CPM

February 7, 2018

First, the basics. The Critical Path Method, or CPM, is the most commonly used scheduling technique in the construction industry today, designed to minimize delays and enhance accountability so that projects can progress most effectively and efficiently.

When a delay occurs on a construction project, it is common practice to examine the project schedule to identify the “critical path to completion.” We first look at the project schedule update just before the delay event and compare it to the update immediately following the delay event to identify its effect on the project. Additionally, the delay event is examined to see if it occurred on the “critical path” of the schedule or in a non-critical area.

When a critical path delay event is identified, it is common practice to track the delay and its effect on the overall completion date of the project. If the delay changes the positive or negative float of the project completion date, it is generally understood that the critical path delay event did in fact influence overall completion, therefore substantiating a claim for delay damages or other compensation to the claimant.

For this reason, inserting a critical path delay into a schedule should be done as soon as it occurs and placed directly into the critical path of activities at that time. All critical path delays should then be tracked all the way through to completion whenever possible.

When a delay event is identified, whether it is considered critical or noncritical, it is recommended that a new delay event activity be created with as much detail as possible. This activity, or series of activities, should be inserted into a strategic area of the schedule to dissect the critical path. A good practice is to break an existing activity into two activities when the delay occurs. The beginning portion of that activity is then used to define the progress that was occurring at the time of the delay. This beginning activity would then be 100% complete. The delay activity would follow the completed portion of the original activity, with the remaining uncompleted portion of the activity becoming its successor. This portion cannot be completed until the delay is resolved and the work resumed as originally planned.


The “Story” Behind the Delay

There is often a more complex series of issues that support or define the delay event. Typically, these cannot be properly identified in a CPM schedule that is limited by a certain number of characters on an activity description within the context of the schedule. The inserted activity, or series of delay activities, may identify the project for tracking purposes, although the full story explaining the delay event is typically much more involved and complex in nature. It is highly recommended that all delay events be researched fully, assessed, and evaluated for a complete understanding of the issue before determining its true effect on the project schedule.

One problem that often occurs is related to the chain of communication after a delay event is identified. Commonly, the superintendent at the field level identifies a physical problem that immediately disrupts the work. If the superintendent is managing that schedule at the field level, they should report the delay event to the project manager and/or insert it immediately into the project schedule. If the schedule is maintained by a project manager, they should insert the delay into the current schedule and pursue resolution, documenting the issue path from occurrence to completion.

This process often breaks down when the delay event is not properly inserted into the schedule at the time of occurrence at the field or office level. Other times, it is misinterpreted by the person responsible for updating the project schedule as a result of poor communication or coordination with the person who is most knowledgeable of the problem. Delay events must be thoroughly documented and properly managed to create a true net effect on the project schedule, whether for historical purposes to archive the event or for contract and claim management reasons. This is especially important when the issue is complex and not resolvable without further action between the owner and the contractor at the contract level of responsibility.

An experienced delay expert should understand that the critical path of a CPM schedule may not be solely reliable for construction delay claims analysis if the delay event has not been properly, thoroughly, or accurately inserted into the project schedule and with correct logic ties that provide the full effect of the delay event upon all components of the project schedule and its critical path to completion.

The delay analysis must include an in-depth review of the project documentation pertaining to the delay event and the “big-picture” effect that the delay caused to the overall project. Further analysis should come from interviews with all parties involved, as there is typically more to the story than the critical path of a CPM is capable of telling. 

In conclusion, a delay to a project may be simple or very complex. The first line of forensic investigation requires the claim expert to examine the critical path in much the same way that an FAA investigator seeks information from a black box recorder. In both scenarios, there is a more complicated set of circumstances that need to be explored before reaching a final determination as to what the problem was and what effect it had upon the project stakeholders. The delay expert should consider all the details surrounding a delay, and not fall prey to the adage that a project is not delayed if the critical path was not affected at the time of the event occurrence. It’s possible that the critical path is incorrectly demonstrating the true and full effect of the delay upon the project completion, and should not always be considered the sole supporting evidence when determining the validity of the delay on a construction project.

To learn more about VERTEX’s Construction Claims Consulting services or to speak with a Construction Expert, call 888.298.5162 or submit an inquiry.


Jeff Puzzullo

This article was originally published by Xpera Group which is now part of The Vertex Companies, LLC.

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