Should extended preliminaries be valued using bill rates or the contractor's actual additional cost?
The starting point is the contractual valuation rule. Where entitlement concerns direct loss, expense or cost incurred, recovery should ordinarily reflect reasonable additional expenditure caused by the compensable event, not automatic application of tendered preliminaries rates.
Use the contract's valuation basis and prove the reasonable additional cost actually caused
A priced preliminary may assist as evidence, an agreed rate or a cross-check, but it may include assumptions, profit, risk or costs that did not continue. Identify the affected period and each resource retained or added because of the employer-risk event. Exclude costs incurred in any event, items serving unaffected work and sums recovered elsewhere. Finance, overhead and profit depend on the contract's definitions and cannot be imported automatically.
| Issue | Position |
|---|---|
| Express bill-rate valuation | Apply if the contract requires it |
| Direct loss or actual cost wording | Prove reasonable causal expenditure |
| Tendered preliminary | Evidence or cross-check, not automatic entitlement |
| Unaffected resource | Not recoverable merely because time extended |
| Finance, overhead and profit | Apply the specific contractual definition |
The rest of this solution is for members
Fifty of the two hundred contractual solutions are free to read. This is one of the remaining hundred and fifty, which Premium and Pro carry.
See what Premium includesAlready a member? Sign in