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Warning Letter For Slow Progress of Work - Reviewed

This letter from Acute Engineering serves as a warning to Berhan Tobiyaw BC regarding slow progress on a construction project for Addis Ababa Science & Technology University. The project is overdue based on the approved schedule. Acute Engineering lists seven issues with Berhan Tobiyaw's performance and lack of adherence to the construction agreement. Berhan Tobiyaw is instructed to submit a realistic work program and budget plan within one week to address the issues and demonstrate how they will complete the project on time, or Acute Engineering will advise taking further contractual action.

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22K views3 pages

Warning Letter For Slow Progress of Work - Reviewed

This letter from Acute Engineering serves as a warning to Berhan Tobiyaw BC regarding slow progress on a construction project for Addis Ababa Science & Technology University. The project is overdue based on the approved schedule. Acute Engineering lists seven issues with Berhan Tobiyaw's performance and lack of adherence to the construction agreement. Berhan Tobiyaw is instructed to submit a realistic work program and budget plan within one week to address the issues and demonstrate how they will complete the project on time, or Acute Engineering will advise taking further contractual action.

Uploaded by

Freedom Love Nabal
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Our Ref. No.

: ACE/AA/AASTU/ 041/22
Date: April 20, 2022

Berhan Tobiyaw BC
Addis Ababa

References:
1. Construction Agreement with AASTU for the Construction of Four Guest House Buildings &
Infrastructure Works/ Site Works ( Lot 6)
2. Our letter reference no. ACE/AASTU/313/21 dated on May 21, 2021
3. Our letter reference no. ACE/AASTU/369/21 dated on December 27, 2021
4. Our letter reference no. ACE/AASTU/397/22dated on March 21, 2022
5. Our letter reference no. ACE/AASTU/405/22 dated on April 05, 2022
6. Our Weekly Meetings On site

Subject: Warning Letter for Slow Progress of Work


Dear Sir,
It is to be recalled that your Company has made an agreement for the construction of
aforementioned project with Addis Ababa Science & Technology University on the 3 rd of July
2018. The contract agreement comprises of construction of Four Guest House Buildings &
Infrastructure Works/ Site Works (Lot 6) at Addis Ababa Science & Technology University
compound.

Based on the last EOT approved by the Employer, the due date for the completion of the
project was March 28, 2022. However, till to date the project status is 67.63%.

It is evident that your performance on the project has deteriorated to a level that requires your
immediate action which otherwise will require further contractual considerations.

This poor performance issue has resulted in creating many other problems on the project
including extreme delay of the project which extends the Employer’s investment return period.
Even more disturbing is the fact that, despite having already expressed our concerns to you
regarding these substandard performance issues, there has not been any attempt on your part
to improve your performance. Regardless of the many promises for improvement you’ve made
to us no affirmative action has been taken.
The current issues at hand concerning your poor performance include:

1. Your performance is extremely less than the expected performance of an experienced


contractor, and against the schedule (Average Execution less than 15% of the Plan). Based
on the current performance, the project may take years to be functional despite the
Employer needs it urgently. Hence; Pursuant to GCC Clause 21.2 (a), you fail to carry out
the Works within in the period of the Contract. As the gaps between planned and
executed amount is continuously becoming wider to the level of lack of confidence by the
Engineer for completion of the project and the project become time at large;

2. You were unable to stick with the program due to mainly budget starvation of the project
that must be provided as demanded by the project to fulfill your contractual liabilities.
There is shortage of Working Capital, even though full advance payment was paid and
critical materials were provided by the Employer;

3. Despite the financial support by the Employer in allowing additional advance to improve
the rate of progress and alleviate cash shortages, no significant improvement is observed
on site. Even though, some materials mentioned in the advance disbursement schedule are
supplied to site and some wooden door production is ongoing, most of the materials to be
supplied including aluminum, porcelain tiles & skirting, ceramic tiles & skirting,, have not
yet been supplied to site and only small quantities of marble, cemetitious and membrane
type waterproofing are supplied as compared to the required quantity.
4. Immediate actions were not taken for our instructions, letters , repeated discussions on
regular meetings and oral notifications and this affects the project progress negatively;
5. It is observed that less attention is given on the progress of the project especially from the
owner of the company.
6. You haven’t been working with due care and diligence, in accordance with the provisions
of Contract GCC Clause 34.1.; and
7. You are not working in accordance with the Program of implementation of tasks
submitted by your company as per GCC Clause 41.1.

The intent of this letter is to clearly inform you that unless there is immediate and considerable
improvement on your part in all of the areas described above, the Employer will be resorted to
subsequent contractual measures. The essence of the Contract is affected since your
performance is in default before your obligation is due.

Unless the following listed instructions will have been fulfilled by your company, we will advise
the Employer to take the next contractual action.
 To submit persuasive details that can draw a big pictures how you can complete the project
as per the Contract within one weeks’ time-bar upon receiving this letter;

 to submit updated and realistic work program for implementation of tasks as per GCC
Clause 41.1 within one week time-bar upon receiving this letter taking into consideration
the timeline agreed on meeting (June 30,2022) with the Client; This should include the
detail activity schedule, major material procurement details as well as delivery schedule,
etc

 to allocate extra budget to enhance your performance and fulfill you contractual
obligations;
 to give the project full attention in terms of resources mobilization and budget allocation ;

Finally you will present your submitted documents for your plans on how to finalize the project
with the corresponding schedules in the presence of all signatory bodies after submission.

With Regards,

Tamrat Defalign

Deputy Manager of Acute Engineering Plc.

CC:

 Addis Ababa Science & technology University


 Project Coordinator of Acute Engineering PLC

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