To ‘But For or Not But For’?
INTRODUCTION
The collapsed as-built (CAB) or ‘but for’ analysis is capable of establishing critical delay, evaluating concurrency and pacing—and, in turn, establishing the true extent of compensable delay.[1] However, it is sometimes criticised as being liable to subjectivity and unintended (or intended) manipulation.[2]
Properly performed, the CAB method provides a comprehensive basis for assessing delay, particularly when considering events that attract delay costs. It is based on the facts of what actually occurred on a project, can effectively assess all delays and is arguably the most suitable method for assessing concurrency and pacing. However, the mere mention of the CAB method sometimes draws pointed criticism from legal practitioners and industry claims professionals. On face value, this criticism is misconceived because, in my view, the method effectively ‘ticks all the boxes’ for a robust delay analysis.
The purpose of this article is to discuss the potential benefits of the method and how criticisms can be overcome by applying common sense. Additionally, this article will explore the findings of pertinent case law where the use of the CAB method has been considered.
BENEFITS OF THE CAB METHOD
As-Built
As the saying goes, ‘facts are facts and will not disappear on account of your likes and dislikes’.[3] The key benefit of the CAB method is that it relies wholly on what actually happened.[4] This is consistent with the view expressed by The Association for the Advancement of Cost Engineering International (AACEI), which stated that the CAB method ‘relies upon [the] history of actual events’.[5]
Similarly, Barry stated that the method ‘should have the benefit of working from a full factual matrix’.[6] Keane and Caletka also argued that the primary advantage is that it ‘considers events in the framework of the actual timing and sequence in which they occurred’.[7]
Concurrency and Pacing
Concurrency is among the most contentious and debated topics in the dispute resolution industry. It lies at the core of most disputes concerning extensions of time and delay costs. In my view, the CAB method (when properly performed) is the best form of analysis to use to consider concurrency, pacing and parallel delays.
The AACEI contends that the ability to carry out straightforward analysis of concurrency and pacing is a core feature of both forms[8] of CAB analysis.[9] They also provided that the modelled simulated as-built program contains all delays and that after extracting the first delay, other delays are left in the model, thereby accounting for the concurrent effects of those delays.
Similarly, Bramble and Callahan also highlighted that:
any concurrent delays by the [c]ontractor would remain in the schedule, having the effect of automatic compensation for a contractor-caused delay … [and] the [CAB] method of schedule analysis does not require a special concurrency assessment.[10]
COMMON CRITIQUES
Subjectivity
The subjectivity issue seems to be a common point of contention for the CAB. It is a necessary component of the CAB method that logic links be inserted into the as-built program to allow the CAB method to be performed. The insertion of this as-built logic within the as-built program is sometimes criticised as being liable to ‘potential subjectivity’.[11]
As the saying goes, the devil is in the detail!
Zack also emphasised that the most substantial challenge for CAB analyses is examining the details to ensure ‘accuracy, reliability and correctness’.[12] Further, Barry stated that the key difficulty with this method is in retrospectively developing logical relationships between as-built activities. [13]
Time and Difficulty
Another common complaint is the effort and time required to implement the CAB. The Society of Construction Law (SCL) takes the view that the method is a time-consuming and complex endeavour[14], a view that is shared by the AACEI, which advises that the reconstruction of the as-built schedule (ABS) is very fact-and labour-intensive.
THE LEGAL PERSPECTIVE
Case Law
Cases that have considered the CAB method include Leighton Contractors (Asia) Ltd v Stelux Holdings Ltd,[15] Motherwell Bridge Construction v Micafil Vakuumtechnik,[16] and Balfour Beatty Construction Ltd v London Borough of Lambeth,[17]. It is clear that the courts and tribunals have been more interested in the actual event, its effect on the time for completion and the application of common sense.
In the more recent case of White Constructions Pty Ltd v PBS Holdings Pty Ltd,[18] the court rejected both evidence of both parties experts and utilised a court-appointed expert instead. The judge relied upon the court appointed expert’s view because judge considered that he had formed his opinion based on a ‘close consideration and examination of the actual evidence of what was happening on the ground’. A big lesson from the case is that neither the CAB nor the as-planned versus as-built window analysis method were accepted by the judge as neither expert properly considered the relevant as-built facts. In other words, the case affirmed that the retrospective analysis of delay must be firmly grounded in the relevant facts.
OVERCOMING CRITICISM
Subjectivity
As with any delay analysis, the courts and tribunals have been more concerned with addressing the facts and raw data to remove as many subjective aspects of the analysis as possible. Therefore, it is essential to validate the ABS and document the source of the actual start and finish dates. Who can argue with that?
“Pay close attention to the actual facts rather than the opinions about what the evidence establishes”. — White Constructions Pty Ltd v PBS Holdings Pty Ltd
Practical Application and the Baseline Schedule
Based on the common critiques and the professional guidelines for CAB analysis, it is clear that during the development of a SABS, intended or unintended manipulations can occur. Slight adjustments to the logic applied to the ABS can be made to produce drastically different results. It is these potential manipulations that give rise to criticisms of the CAB method. A simulated or collapsible ABS is a schedule that contains the planned activities, their logic and all schedule delays to simulate the as-built dates. While the as-built dates ought to be firmly rooted in fact, it is the logic applied by the analyst to the CAB scheduled that can be criticised for subjectivity.
The SCL’s Delay and Disruption Protocol states that the method does not require a baseline schedule. However, therein lies a potential problem. The baseline schedule is effectively a model of a project execution plan, which also forms the basis for the project’s costs and risks. So why is this not considered?
Is it not imperative that we consider the initial logic and planned activity durations to establish all delays—that is, how the scope of work was meant to be executed?
The AACEI method implementation protocol 3.8 or 3.9 seems to provide the correct approach because it considers the baseline as one of the starting steps for developing a collapsible ABS. From there, delay events are inserted to either account for a delay to start or finish to simulate the ‘as-built’. In this step, extra care must be taken using some common sense. The following simple analysis demonstrates the importance of the baseline schedule.
Figure 1: Diagram showing the planned activities, as-built logic and delay events.
As Figure 1 demonstrates, the respective works was intended to commence on 21 December 2019 and complete by 8 March 2020. However, in reality, it completed on 28 May 2020, thus an 81 day delay to Mechanical Completion is observed.
The intention was to commence the project on 21 December 2019 and receive access from the civil works subcontractor on the same day. The ‘verified’ as-built records indicated that access from the civil works subcontractor was only received on 30 January 2020. For the purpose of this example, the delayed access of 40 days is an excusable and compensable delay.
The installation of structural steel was envisaged to start once access was granted. The ‘evidence’ indicated that the installation of structural steel only started on 25 February 2020. As the baseline envisaged commencement of the steelwork after receipt of access from the civil works contractor, the delay to commencement is measured from when access was actually provided i.e. 30 January 2022. For the purpose of this example, I have determined that this 26-day delay is not excusable nor compensable.
After that, the installation of structural steel was executed in 43 days instead of the planned 28 days initially envisaged. For the purpose of this example, I have determined that the 15 days delay observed is not excusable nor compensable. In addition, the installation of the mechanical equipment was also delayed. For the purpose of this example, I have also determined that this delay in not excusable nor compensable.
In order to collapse the SABS, the observed delays can be extracted in a stepped or global manner. In this example, I have opted for the global extraction. As such, all the delay events from one party i.e. the subcontractor in this case, are extracted simultaneously. Essentially, this produces an analysis which determines the impact to mechanical completion but for the subcontractor’s delays. Refer to Figure 2 below:
Figure 2: But for Subcontractor Analysis.
In summary, But for Subcontractor delays, the respective Subcontractor would have achieved mechanical completion by 17 April 2020. Therefore, an entitlement for 40 days of EOT is determined.
The first criticism from the detractors is that the analysis assumes that, but for the owner’s delays, the project would have been built as it was originally planned i.e. 8 March 2020. The simple answer is ‘yes’, provided all the delays were actually the owners’ risk. However, in this example, it is clear that the subcontractor also contributed to the overall delay to mechanical completion.
Notably, the benefit of the CAB method is that it captures all delays, regardless of which party is responsible for it. Ultimately, the delays need to be measured against the approved baseline schedule to lend any credibility. While the example is a simple project, the principles remain the same in more complex projects.
Time and Difficulty
While the CAB analysis can be complex and time consuming, the same can be said for other forms of delay analysis prepared to the same standard. By way of example, the time slice windows analysis method is another commonly used delay analysis method. If regularly updated and competently prepared programs are available, then the time-slice windows analysis method can be quicker and easier to prepare than the CAB method. However, the time-slice windows form of analysis relies on regular contemporaneous progress updates, which are often flawed and require modification prior to analysis. The flaws often observed include schedule compression, logic manipulation and a variety of other poor planning practices. Unwinding these flaws is often difficult and time-consuming, particularly where there are a significant number of programs used in the analysis. All dynamic forms of delay analysis require the utmost care and consideration of various factors to ensure the results are reasonable and accurate.
CONCLUSION
Ultimately, forensic delay analysis requires elements of objectivity and subjectivity, regardless of the method being applied.
A delay expert’s ultimate function is to select a method that can reduce the degree of subjectivity and focus on causation in the most accurate way possible. The perceived weakness in the CAB analysis method can be overcome by adopting a more structured and common-sense approach to preparing the analysis. Similarly, compared to other methods, such as the time impact analysis and time slice windows analysis, the analysis is likely to be completed in less time if executed with the same level of care and accuracy.
The courts have regularly made it very clear that they are concerned with delay expert evidence establishing what actually happened and what caused it. If a CAB analysis is conducted properly, it can achieve that goal. Likewise, the CAB method can be used to reliably analyse of concurrency, pacing and compensable delay periods. Most other recognised delay analysis methods fall short of the CAB method in this respect.
While it is understandable that parties engaged in alternative dispute resolutions have different requirements, resources and budgets, is it correct to ignore this method merely because of its ‘perceived’ complexity and higher costs versus the opportunity to establish the actual delays and quantify compensable delay more accurately?
If one is willing to give expert evidence on matters of time, given the judicial guidance to date it is highly likely that the expert will select a delay analysis method that relies on establishing what actually happened.
Moreover, with the rise of concurrent delay provisions in construction contracts, and the need to establish actual losses as part of delay costs claims, there is a notable advantage in selecting a method that is also intrinsically designed to account for concurrent delays. As a result, the use of the CAB method in contemporary delay analysis is no fool’s errand.
[1] Andrew, A & Rider, RJ 2017, The collapsed as-built windows schedule analysis method, Long International, page 9, https://www.long-intl.com/articles/schedule-analysis-method/
[2] Zack, JG, Jr. 2001, But-for schedules—analysis and defence , Cost Engineering, 43(8), https://www.proquest.com/scholarly-journals/schedules-analysis-defense/docview/220434129/se-2
[3] Nehru, J.
[4] And it requires the ‘as-built data’ to be correct.
[5] AACE International Recommended Practice No. 29R-03 forensic schedule analysis, 25 April 2011, page 89.
[6] Barry, D 2008, Beware the dark arts! Delay analysis and the problems with reliance on technology, SCL International Conference, page 7, https://www.scl.org.uk/papers/beware-dark-arts-delay-analysis-and-problems-reliance-technology
[7] Keane, PJ & Caletka, AF 2015, Delay analysis in construction contracts, 2nd ed., Wiley Blackwell, page 159.
[8] The two forms are: (1) [insert]; and (2) [insert].
[9] AACE International Recommended Practice No. 29R-03, forensic schedule analysis, 25 April 2011, pages 84, 92.
[10] Bramble, BB & Callahan, MT 2011, Construction delay claims, 4th ed., Aspen Publishers, pages 11–66.
[11] Andrew, A & Rider, RJ 2017, The collapsed as-built windows schedule analysis method, Long International, page 8, https://www.long-intl.com/articles/schedule-analysis-method/
[12] Zack, JG, Jr. 2001, But-for schedules—analysis and defence , Cost Engineering, 43(8), https://www.proquest.com/scholarly-journals/schedules-analysis-defense/docview/220434129/se-2
[13] Barry, D 2008, Beware the dark arts! Delay analysis and the problems with reliance on technology, SCL International Conference, page 7, https://www.scl.org.uk/papers/beware-dark-arts-delay-analysis-and-problems-reliance-technology
[14] SCL 2017, Delay and disruption protocol, 2nd ed., page 37, https://www.scl.org.uk/resources/delay-disruption-protocol
[15] Leighton Contractors (Asia) Ltd v Stelux Holdings Ltd [2004] HCHK HCCT29/2004.
[16] Motherwell Bridge Construction v Micafil Vakuumtechnik [2002] CILL 1913, page 562.
[17] Balfour Beatty Construction Ltd v London Borough of Lambeth [2002] BLR 288, page 21.
[18] White Constructions Pty Ltd v PBS Holdings Pty Ltd [2019] NSWSC 1166.
[19] As reported contemporaneously.
[20] AACE International Recommended Practice No. 29R-03 forensic schedule analysis, 25 April 2011, page 11.
