Contractor now blames Ministry consultant, COVID for delays

Days after $356M contract terminated

Chung’s Global Enterprise (CGE), the construction company that days ago had its $356.8 million contract to construct the Health Ministry headquarters terminated due to delays, is now pointing fingers at the Ministry’s consultant, VIKAB and the COVID-19 pandemic, for causing the delays. This is despite the fact that the contractor was supposed to deliver the finished building in 2018.

On Monday, CGE General Manager Keisha Chung said that the contract was first awarded on November 8, 2017, and that the Public Health Ministry, as it was known at the time, then took 155 days before they finally appointed VIKAB Engineering Consultants to oversee the project on April 12, 2018.
Chung claimed that when VIKAB arrived, they found that the bill of quantities prepared for the project was poorly done and contained inadequacies. As such, it was agreed by both parties that VIKAB would provide a completely revised bill of quantities, complete with drawings that included the piles and steel structures.
According to Chung, the commencement order was issued on July 19, 2018, after 98 days’ delay. VIKAB then provided the first set of construction drawings to CGE almost two months later.

Chung further claimed that VIKAB took until September 2, 2019, before it provided the completely revised construction drawings and bill of quantities – 353 days’ delay from when they got the first set of drawings.
It was explained that the revised bill of quantities included curtain wall designs and specifications for windows, elevators, heating, ventilation and air conditioning, electrical systems, CCTV and plumbing. Further variations were submitted in January 2020.

“It should be noted that our first revised pricing was submitted in October 2019 but due to continued negotiations with VIKAB, we were able to submit our final price on August 3rd, 2020. Further, our final price on the revised bill was within the estimated price VIKAB came up with,” Chung said on Monday.
She further claimed that VIKAB had been providing drawings in a “piecemeal manner” prior to September 2019, which she blamed for the company’s inability to effectively plan and procure materials. By this time, over a year had passed since the commencement order was issued.

The General Manager claimed that throughout all of this, VIKAB never issued CGE with a warning letter or a letter terminating the contract. She said that after they received the revised documents, works commenced and continued until the COVID-19 pandemic and the then COVID-19 Task Force put a stop to it on April 3, 2020. Limited work then recommenced on July 17, 2020.
“We have no interest in wasting taxpayers’ dollars on a matter that could have been amicably resolved,” Chung wrote.

In a letter seen by this publication, Attorney General Anil Nandlall wrote to Cleon Chung of Chung’s Global Enterprise on Saturday and informed him that the contract was being terminated effective October 31, 2020, on the grounds of contractual breaches.
Chung’s was awarded the contract since 2017, to construct the Health Ministry’s head office building at Lot 1 Brickdam for the sum of $356.8 million. The commencement order was issued on July 19, 2018, and the contractor was supposed to complete the project within a year.

However, in September 2020, despite receiving $308.4 million for advance payments and mobilisation expenses, as well as two extensions totalling 317 days, permanent works are only 70 per cent completed at the site.
The contractor then submitted the repriced bill of quantities, demanding an additional sum of $513.3 million on August 3, 2020 – a mere day after the Government officially changed hands with the swearing-in of President Dr Irfaan Ali. This is almost triple the previously agreed price of $356.8 million.

“In further breach of the said contract you failed to respond within the required time in submitting additional requested information on the priced bill of quantities pursuant to clause 28.2 of General Conditions of Contract which provide that at the request of the employer, the contractor within seven days shall provide the employer with a detailed breakdown of prices of change in the quantities indicating the rates for kinds of works and value of consumable material. The employer shall evaluate those rates and value of consumable material in comparison with the bill of quantities,” Nandlall had written to the contractor.

The Attorney General, therefore, instructed the contractor to immediately stop all works, secure and vacate the site as soon as possible. According to Nandlall, the Government is not only terminating the contract but would also be instituting legal proceedings against the contractor for breach of contract and liquidated damages.