Reference no: EM131819978

Question:

One: A general contractor ("GC") was hired by the owner to build an hotel. The GC incurred costs exceeding the budget, for which the GC submitted a change order to the owner for approval. The owner denied the change order, claiming that the totals included in the change order were not accurate and were the responsibility of the GC, not the owner.

In the change order, the GC included extra costs for:

1) Delay (general conditions, equipment rental and project manager), due to the owner's multiple design changes

2) Increased labor and materials over what the GC included in the original budget (upcharges for higher grade materials, several steel beams rather than wood and rework due to inspection deficiencies noted) due to incomplete architectural and structural drawings

You are hired to "audit" the GC's project records in relation to this change order to determine whether any charges are valid.

Name ONE of the records you would request from the GC for analysis, what information that document would provide in your analysis and some specifics on the analysis you would perform using that document. (Please try to choose a document that has not been previously discussed in prior responses.)

Two: A general contractor ("GC") was hired to build a 50-mile long road. The GC hired a designer/structural engineer to design retaining walls to support the road. The drawings given to the GC did not clearly provide the detail to sufficiently show how the wall would be secured to the "soldier piles". Before final completion of the project, the wall fell down and a mile of the road sank. The GC repaired the wall and the road incurring extra costs.

Assume the designer was at fault. Discuss the costs and methodology to capture those costs for which the GC could make a claim.