Oostewald van Niekerk
15th Dec, 2019
Float is not defined by the Joint Building Contracts Committee (JBCC) in any of their contract suites, nor by the FIDIC contract suits. These are the two contracts most used by AGORA Quantity Surveyors. However, float is a critical consideration when adjudicating extension of time claims. The term float is used to refer to the time (normally in days) that an activity can be delayed before that activity becomes critical. Float is built into the construction program by the contractor. The question then arises: “Who owns the float?”
There are three possible owners of float:
While it seems only fair to state that float belongs to the project, there is one brief period of time where float belongs to the contractor. The contractor decides how much float to assign to each activity in the project program.
The Contractor owns the float
The contractor created the float when he created the construction program, he determined the sequencing of the construction activities and thus created the float and he can directly impact the float based on his performance in executing the construction works.
A second argument for ownership by the contractor relates to risk. It is often assumed that the contractor carries the most risk relative to delays and are thus best suited to responsibly use the float. Thus, the contractor created the float and should be permitted to use the float to mitigate delays experienced in zero float activities.
The Employer / Client owns the float
Ultimately everything belongs to the employer/client. He has paid for the services of the contractor which includes his program & sequencing of the works and thus the float that was built into the program.
Just like the contractor the employer has certain risks if a project is delayed and should therefore be allowed to use the float in the program. The JBCC clause 23.2 allows the contractor to claim an extension of time with an adjustment to the contract value. This clause places the employer at risk to incur additional cost if he cannot use the float to mitigate this claim for an extension of time with cost.
The Project owns the float
The argument here is that the float in the program belongs to whoever uses it first. The key to this argument is that the parties uses the float in good faith. It is thus important that the contractor not claim for an item when float time exists. If float belongs to the project, all the float in the program should first be exhausted before an extension of time can be considered.
The subject of who owns the float is vague at best and construction contracts does not address the issue of float directly. The legal practice Kenney & Sam (KSlegal.com) offers a reasonable solution to the debate on ownership of float by suggesting adding a “joint ownership” and “non-sequestering” clause to the contract. Such a clause will provide that none of the parties specifically owns the float.
A generalized example of such a clause that the Quantity Surveyor can add to his Preliminaries and General Bill will be as follows:
Clause 23.0 – REVISION OF THE DATE FOR PRACTICAL COMPLETION
Clause 23.0 is amended by adding the following:
Float (time that an activity can be delayed before that activity becomes critical) including total project float, is not for the exclusive use of either party (The employer or his agents, or the contractor), but is jointly owned by all parties and is a resource available to and shared by the parties as needed to meet contract milestones including the contract practical completion date. The Contractor will be open and honest about the float that was built into the program and shall not sequester float through extending activity duration to consume available float.