Dr. Ralph Ellis

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1

Dispute Review Board Value Contributions

Ralph Ellis, P.E., Ph.D.

Dr. Ralph Ellis

Potential Benefits

• Direct saving in dispute resolution cost

• Direct savings in improved project performance

• Indirect value gained from DRB hearings

Dr. Ralph Ellis

Savings in Dispute Resolution Cost

• Litigation cost is high– Legal expenses– Key personnel time– Loss of attention to your business

• The outcome is uncertain

Dr. Ralph Ellis

Improved Project Performance

• Projects with DRBs on average perform better than projects without DRBs

• Lower cost growth

• Lower time growth

Dr. Ralph Ellis

Analysis of FDOT Projects

• In 1994 FDOT began introducing DRBs

• From 2000 to 2002 we have both non-DRB and DRB projects

• This provides a rare opportunity to compare project performance

Dr. Ralph Ellis

Performance MeasuresTime Cost Growth = Final Contract Amount - Original Contract Amount

Original Contract Amount

Time Growth = Final Contract Time - Original Contract Time

Original Contract Time

Dr. Ralph Ellis

Project Cost Growth on FDOT Projects

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

1999 2000 2001 2002*

Year of Completion

Per

cen

tag

e o

f G

row

th

Traditional Projects

DRB Projects

Dr. Ralph Ellis

Time Growth on FDOT Projects

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

1999 2000 2001 2002*

Year of Completion

Per

cen

tag

e o

f G

row

th

Traditional Projects

DRB Projects

Dr. Ralph Ellis

Cost Growth on FDOT Projects

5.00%

6.00%

7.00%

8.00%

9.00%

10.00%

11.00%

12.00%

13.00%

1999 2000 2001 2002*Year of Completion

Per

cen

tag

e o

f G

row

th

Traditional Projects

DRB Projects

Regional DRBsFormed

Dr. Ralph Ellis

Time Growth on FDOT Projects

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

1999 2000 2001 2002*Year of Completion

Per

cen

tag

e o

f G

row

th

Traditional Projects

DRB Projects

Regional DRBsFormed

Dr. Ralph Ellis

Findings

DRBs resulted in:

2.7% Net Cost Growth Savings

15.1% Net Time Growth Savings

Dr. Ralph Ellis

In Today’s Work Program

2.7% x $3 Billion = ?

15.1% x 60,000 days = 9000 days9000 x $4,000 per day = ?

DRBs result in significant direct savings.

Dr. Ralph Ellis

DRB Hearing Recommendations are an Indicator of Areas that Need

Improvement

Dr. Ralph Ellis

Differing SiteConditions

Pay Items andQuantities

General Contract Interpretation

Other Issues

DesignErrors

Rework

24%

27%

21%

14%

7%6%

DRB Hearing Disputes by Category 1996 - 2006

Dr. Ralph Ellis

27%Differing Site Conditions

• Utility Conflicts

• Different Subsurface Conditions

• Different Project Environment

Dr. Ralph Ellis

Differing Site ConditionExisting Gravity Walls

• Plans do not show existing gravity wall and do not call for removal

• Walls are mostly underground, from the road they appeared to be a thickened sidewalk edge

• Contractor did not notice the walls during the pre-bid site visit

• Contractor request compensation for removing the walls

Dr. Ralph Ellis

EOR :

We generally we don’t call out items to be

removed such as curb, sidewalks, etc. The intent

is to have the contractor perform a site visit before

submitting a bid as required by the specifications.

Specification 2-4

Examine the contract documents and the site of

the proposed work carefully before submitting a

proposal for the work contemplated.

Dr. Ralph Ellis

Cross sections did not show gravity wall.

Dr. Ralph EllisContractors also read the PPM.

Dr. Ralph Ellis

Differing Site ConditionsEnvironmental Issues

• Noise ordinances and permitting

• No night work ordinances

• Security procedures

Dr. Ralph Ellis

Contract Interpretation DisputeTime Extensions

• Design-Build contract with A+B bid and I/D provisions

• Contractor believes that weather time extensions are applicable to Liquidated Damages and Disincentives

Dr. Ralph Ellis

Dr. Ralph Ellis

Rework

• We have had several substantial disputes involving replacement of concrete structures due to cracking

• These are serious issues because of the time and cost

Dr. Ralph Ellis

Lessons to Be Learned

DRB hearing issues are indicators of areas that may need management attention. Owners can use this information to improve the design and construction process.

Dr. Ralph Ellis

Official Construction Engineering Career Qualification Test

Dr. Ellis

Dr. Ralph Ellis

Find the Shortest Path from A to B

A

B

Dr. Ralph Ellis

Find the Shortest Path from A to B

A

B

Forget Engineering. Try Art History or Journalism

Dr. Ralph Ellis

Find the Shortest Path from A to B

A

B

Not a Construction Engineer Great Potential in Structural Engineering

Dr. Ralph Ellis

Find the Shortest Path from A to B

A

B

Definitely Construction Engineering. Great Potential as Owner’s Project Engineer

Dr. Ralph Ellis

Find the Shortest Path from A to B

A

B

Definitely Construction Engineering. Great Potential as a Contractor

Dr. Ralph Ellis

Go Gators