Peace Bridge builder Graham Construction want more money

[thetransporter]

(incase you didnt know another bridge is being built in the NE/SE part of the river (near eastvillage protect)

Peace Bridge builders want more money
Graham Construction was 17 months late in completing the pedestrian bridge


The controversial pedestrian bridge, which cost the city $25 million, opened last March.


The company that built Calgary's Peace Bridge wants more money from the city despite a 17-month delay in completing the project.

The controversial pedestrian bridge, which cost the city $25 million, opened last March.

Graham Construction is saying the delay and additional work cost the company considerably more than what it was paid by the city.

Ald. Druh Farrell said the city agreed to a fixed price contract with Graham Construction and there is no intention of putting more money into the project now.

"I'm very disappointed in Graham Construction," Farrell said. "We do have a fixed price contract and as far as council is concerned, in our discussions, that is binding."

Despite the delays, Ald. Gord Lowe says he is not aware of any obligation on the city to pay additional costs.

"Given the delays, I'm not surprised the parties involved are looking at what happened and why and looking for restitution," Lowe said. "In as far as I know, the city had a fixed price contract."

[Go4Long]

If only it was written in to the contract that if the bridge was delayed the company would be penalized this would have turned out way better. As it is, I hope the city tells them to pound sand and excludes them from any future city projects due to obvious inability to complete jobs as per contract.

[FraserB]

Depending on how the contract was written, they might have grounds to try and collect extra money for the delays. Also depends on the inspection protocols and who had final authority at the fab facility.

[AndyL]

The contract is going to be ugly - this will go to courts...

Graham should be seeking compensation; city contract specified component manufacturer, architect oversaw that side of component fabrication. Those components failed inspection in calgary; had to be rebuilt by Graham here.

the city sourced and specified the supplier, not Graham - they just got the fun and stuck picking up the pieces.

thanks druh and bronco - great mess you guys have created; the lawyers will win as usual.

[lasimmon]

You guys are missing 1 key point.

The city has a bylaw stating if a company takes them to court they can never bid on city projects again. Therefore this is going to be settled outside of court.

They pitched additional costs, the city will review and return their findings. They will pitch again, and the city will either accept or reject based on merit. And then it is over.

[Redlyne_mr2]

So much for a peaceful solution

[sillysod]

Whatever, they probably under-bid all the other contractors and won the job figuring they would just get some money on the back end.

Companies do that kind of stuff all the time to get contracts. If you bid it wrong ( on purpose or by accident) then you own it. Plain and simple. If it was the other way around you wouldn't see Graham saying "Hey, we came in way under our estimates so here is $2mill back."

Some outfit from Ontario got the airport, underbid everyone here. If they can actually do it for that price great but if of not then IMO it's on them.

[Twin_Cam_Turbo]

Stop building stupid bridges dammit.

[themack89]

Originally posted by sillysod
If they can actually do it for that price great but if of not then IMO it's on them.

Haha ignorant... The government/municipality faces risks too you know.

Graham would have been smarter to delay the project even longer on purpose and at least use hold-up costs as an incentive to get the city to pay out of pocket beyond the original bid. After the bridge is built and the asset is fixed/sunk, way too easy for the government to turn their backs and burn the contract.

[FraserB]

Originally posted by sillysod
Whatever, they probably under-bid all the other contractors and won the job figuring they would just get some money on the back end.

Companies do that kind of stuff all the time to get contracts. If you bid it wrong ( on purpose or by accident) then you own it. Plain and simple. If it was the other way around you wouldn't see Graham saying "Hey, we came in way under our estimates so here is $2mill back."

Some outfit from Ontario got the airport, underbid everyone here. If they can actually do it for that price great but if of not then IMO it's on them.

How much should companies build into the cost of projects in the future to account for this kind of thing then? The reasons for this are pretty much the city's fault and the faricator that the city chose. You can bet that the scope that Graham bid on didn't include "re-weld bridge when it fails inspection".

[clem24]

Originally posted by Redlyne_mr2
So much for a peaceful solution

Well someone's got to bridge that money gap.

[sillysod]

I have a friend that works for a competing engineering company that was teamed up with another builder. Most of these large projects you will have an engineering company team up with a contractor and together they submit a bid.

Their bid was significantly higher than Grahams. Turns out their bid was right around the actual cost of the bridge.

[BerserkerCatSplat]

Originally posted by FraserB


The reasons for this are pretty much the city's fault and the faricator that the city chose. You can bet that the scope that Graham bid on didn't include "re-weld bridge when it fails inspection".

Depends strongly on the how the contract was written. If Graham signed a contract that didn't give them recourse in this kind of situation (especially in a fixed-price contract), it doesn't matter whose fault it really is - they'll be hosed. "Fault", in terms of financial responsibility, is defined by the contract, not by common sense or logic.

RTFC.

[lilmira]

Depending on how the contract is structure, it's up to the bidder to estimate the cost associated with the risk involved into the price. If you ignore them, put in a low price, win the bid and the risk turns into reality, you'd better suck it up. If the contract is unfair, you don't have to bid or you adjust your price accordingly. It'll be interesting to see how this turns out. I suspect it will get snuffed out behind doors one way or another.

[DeleriousZ]

Originally posted by clem24


Well someone's got to bridge that money gap.

[sillysod]

Originally posted by BerserkerCatSplat


RTFC.

ding ding ding

welcome to my world

[themack89]

People argue in favor of a contract being binding or non-binding depending on if its harming them or helping them.

You guys can't honestly believe that such a thing as a complete contract exists which fairly caters to both parties, ie foreseeing every possible contingency.

This thing went 40% over budget relative to initial negotiations--that's HUGE, you think Graham is this amateurish? I'm guessing it was actually the government who fucked the dog on this one based on the way the article's and comments released for it are stated. I.e. "I am surprised Graham is bringing this forward..." "Fixed price contract!" etc etc. Plus, using their size and dominance to scare them away from taking it to court? We're going to fucking ban your company from city contracts??

There's very little information on why the project was held-up.... But it's definitely being reported in favor of the City.

To me what this looks like: Govt. saying "Look citizens! We don't let these damn companies take your tax money without a fight! Vote for us/me! (Druh Farell)"

Contracts aren't supposed to be an imbalanced transfer of risk, they are risk spreading devices. They are designed to prevent parties from getting fucked and fucking each other, clearly this has failed... But we are missing too many pieces of information to understand why.

[88CRX]

If there's any change in scope then money is owed.... this isn't Graham's first rodeo so I would be surprised if this wasn't the direction they're going.

Plus didn't the City pre-qualify the steel contractors who ended up supplying the crappy steel/welds?

[lilmira]

For sure we don't know a lot of the crucial details in the contract and what went wrong during the construction, we'll probably never find out. Graham is not the new kid on the block, they wouldn't ask for more money unless they are butthurt and have a valid reason to do so. They do a lot of infrastructure too so I don't think they would want to piss off the city.

You know they'll adjust their price accordingly next time though.

[revelations]

Graham will just add a few % extra to every city contract from now on to cover their losses in case this goes nowhere