The timely treatment of variations is important. The time periods for responses by the Superintendent and the Contractor are a critical part of managing variations. The timeframes are set out in a Variation Checklist.
Where the variation results in an extension of time, the Contractor must be encouraged to provide a response at the same time as the costs are derived.All too often the time component is delayed due to “unknown” effects, however it is highly advantageous to resolve each issue as it arises to minimise downstream situations such as claims. The Superintendent should make all attempts to meet with the Contractor to resolve outstanding variations throughout the Contract (whilst the details are fresh in both party’s minds) rather than at the end of the Contract.
What Constitutes a Variation?
The usual area in which the Superintendent is required to regularly exercise legal judgments under the Contract is in the authorisation and valuation of variations. The Contractor may assert from time to time that particular works which he has been required to perform (either in accordance with the contract documents, or alternatively pursuant to a direction of the Superintendent) constitute a Variation.
The test applied by the Courts is, in substance, that particular work constitutes a variation if it is work outside the works upon which the Contractor tendered/contracted, having regard to the terms of the Contract.
A number of issues regularly arise in relation to whether or not work constitutes a variation, including:
- whether work subsequently performed by the Contractor is or is not included in the contract documents.
- whether particular work to be performed by the Contractor is, in accordance with the terms of the Contract, to be inferred from the contract documents.
- whether the circumstances in which work properly described in the contract documents is to be performed are different from the circumstances described in the tender/contract documents.
These types of variations differ from the easy to understand type of variation, namely where the client wishes to change the work described in the original contract documents and seeks a quotation from the Contractor prior to that work being performed, which quotation the Proprietor then accepts and orders the variation or not.
The Superintendent's assessment of whether or not work constitutes a variation is more than a technical assessment. It requires skills in interpreting contract documents, a judicial impartiality in listening to the views of the Proprietor and the Contractor, and an ability to interpret documents which often are non-specific in relation to the subject matter of the asserted variation.
As was the case in relation to the assessment of complex claims under the contract in certification of progress claims, the Superintendent is appointed by both parties to the contract to make this assessment. The choice of the Superintendent is, in theory, a matter for the parties at the time of entering into the contract, but is, in practice, a matter which is usually decided solely by the client.