CASE STUDIES

Abnormally low price case

Contractor vs GDDKiA - D&B contract

Polish National Chamber of Appeal (KIO) case has been won due to a successful Report that CML had drawn up for the General Contractor and as a result GDDKiA [General Directorate of Polish Roads and Highways] had to pay extra PLN 300 million for its investment (the cheapest bid was over PLN 500 million)

This project, to adapt Trasa Armii Krajowej road and Grota-Roweckiego Bridge to the standards of the S8 expressway, was a design and build contract (D&B), which made it very difficult to find the appropriate arguments to convince the KIO court and therefore, the result of the court case is so important for the Contractors here. The Contractor fulfilled this contract for PLN 800 mln.

CML report for Metrostav (presented to KIO) was drawn up during 97 hours (key expert timesheet), when CML worked on average 10 hours a day, then CML had to prove (in KIO) that the GDDKiA  has to pay extra PLN 300 million for its investment. CML is able to present the right combination of time for review.

The final version of this crucial technical report is actually a feasibility study – presented on 13 pages of evidence: the detailed calculation of R (labor), M (materials), S (equipment), overheads, etc. (3 pages), the financial tables (2 pages), a program of works, drawings (5 pages) and technical description (2 pages).

CML is aware of the fact that the legislature changed the Polish Public Law in late 2014 and currently GDDKiA [General Directorate of Polish Roads and Highways]   examines the abnormally low prices in a different way than before the change.

Today it seems that it is easier to present and defend what contractors have calculated in their offer (but still – it is on this basis we have performed successful calculation), than when you had to “prove competitive offer's unrealistic value” Nevertheless, CML managed to do the latter anyway and present the effects of its work to the National Chamber of Appeal.