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Supporting
its case using productivity factors set out by the Mechanical
Contractors Association of America (MCAA), a Florida mechanical
contractor was awarded $853,355 plus interest for work it
performed on the construction of a hospital. Appeal of
the Clark Construction Group, Inc., VABCA No. 5674 (April
5, 2000). The award was affirmed by the Department of Veterans
Affairs Board of Contract Appeals. Appeal of the Clark
Construction Group, Inc., VABCA No. 5674R (July 12,
2000).
The
case arose out of the construction of the Veterans Administration
Medical Center in West Palm Beach, Florida. Construction
on the hospital began in 1991. Clark Construction Group
was the general contractor on the project, which consisted
of three connected wings and a separate energy center. The
site was located on a former golf course in a low-lying,
swampy area.
Clark
subcontracted with PKC, a mechanical contractor, for a variety
of services, including water piping, HVAC, heating piping,
sanitary/drain/waste/vent piping, medical gas piping and
piping below the slab.
Initially,
construction on the project was to proceed in a horizontal
construction sequence. PKC bid the project based on representations
of such a sequence, and materials were ordered in anticipation
of such construction.
Because
of the conditions on the site, extensive de-watering was
necessary. Once construction began, it was discovered that
the VA had neglected to obtain the proper permits for the
de-watering system. The pumping was ordered stopped because
of groundwater percolation from a nearby landfill. Throughout
the remainder of the project, less aggressive de-watering
was ordered, resulting in extremely wet conditions on the
site.
The
wet conditions and resulting delays in foundation work necessitated
a change from horizontal construction sequencing to a vertical
sequencing. Consequently, pre-fabrication of piping systems
was impacted, as well as sequencing of materials that had
been pre-ordered for the horizontal plan. Other problems
arose that required moving men and materials between floors
because stairways were not completed as expected. During
the project, extensive discrepancies developed between the
architectural drawings and the mechanical specifications
were discovered. The change in sequencing also produced
problems in coordinating the trades. Design changes were
necessary to complete installation of the equipment.
Upon
completion, PKC sought an equitable adjustment. VA rejected
the claims, and PKC appealed. To support its appeal, PKC's
expert utilized the productivity factors developed by the
MCAA as well as a measured mile analysis and used a modified
total cost analysis to calculate the amounts due from the
VA. The expert utilized three of the productivity factors
listed in Section PD-2 of the 1994 MCAA Manual:
1.
Morale and Attitude: Excessive hazard, competition
for overtime, over-inspection, multiple contract changes
and rework, disruption of labor rhythm and scheduling,
poor site conditions, etc.
2.
Reassignment of Manpower: Loss occurs with move-on,
move-off men because of unexpected changes, excessive
changes or demands made to expedite or reschedule completion
of certain work phases, preparation not possible for orderly
change.
3.
Dilution of Supervision: Applies to both basic contact
and proposed change. Supervision must be diverted to (a)
analyze and plan change, (b) stop and re-plan affected
work, (c) take off, order and expedite material and equipment,
(d) incorporate change into schedule, (e) instruct foremen
and journeyman, (f) supervise work in progress, and (g)
revise punchlists, testing, and start-up requirements.
There
were some questions regarding application of the factors.
In using the factors, actual site conditions as well as
the experience of the contractor come into play. Taking
all that into consideration, PKC's expert calculated the
loss of productivity to be 46,482 man hours, which amounted
to $937,375. Added to this figure were the losses incurred
by PKC's subcontractor, United Sheet Metal. The VA's expert
questioned the retrospective applicability of the MCAA factors
because of ambiguity inherent in the factors and ambiguities
in the instructions for their use.
The
BCA found that the MCAA factors were a reasonable starting
point for calculating productivity losses incurred by PKC.
It recognized that the factors were inherently subjective
but also noted that it would be impracticable, if not impossible,
to keep accurate records regarding productivity losses during
a job of such size. Accordingly, the BCA noted that it would
substitute its "reasonable judgment" for the impossibility
of a precise quantification of the impact of the inefficiency.
The
BCA then went through the factors utilized by PKC's expert
and assigned its own percentage of impact for each of the
factors based on the record. It examined the factors in
light of evidence regarding each factor presented by the
parties during their briefing and arguments. The BCA determined
that PKC was entitled to an equitable adjustment of $853,355,
plus interest.
The
BCA expressly noted that use of the MCAA factors had been
approved previously in Appeal of Fire Security Systems,
Inc., 91-2 BCA (1991). There, although use of the factors
was recognized as valid by the BCA, it also noted that the
record below must demonstrate sufficient specific factual
bases supporting the factors so that the board could determine
that the factors were properly applied. In that case, the
BCA found such evidence lacking and cut the award substantially.
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