Sie sind auf Seite 1von 6

The Project Doctor

www.bmoj.com

BACKCHARGE
PROCEDURE

1 of 6

BMOJ 2007

The Project Doctor

www.bmoj.com

DISCLAIMER

The Project Doctor makes no representations about the suitability of the information
contained in this document and related graphics for any purpose. Any publication
may include technical inaccuracies or typographical errors. The Project Doctor does
not warrant that the materials will be uninterrupted or error-free and that defects
will be corrected.

ALL DOCUMENTS, MATERIALS AND RELATED GRAPHICS IN THIS DOCUMENT ARE


PROVIDED "AS IS" WITHOUT WARRANTY OF ANY KIND, WHETHER EXPRESS OR
IMPLIED, AND The Project Doctor SPECIFICALLY DISCLAIMS ANY IMPLIED
WARRANTIES, WHETHER OF MERCHANTABILITY, SUITABILITY, FITNESS FOR A
PARTICULAR PURPOSE, INFRINGEMENT OR OTHERWISE.

LIMITATION OF LIABILITY.
IN NO EVENT SHALL The Project Doctor BE LIABLE FOR ANY SPECIAL,
INCIDENTAL, INDIRECT, PUNITIVE OR CONSEQUENTIAL DAMAGES,
INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS, LOSS OF USE,
LOSS OF DATA OR INFORMATION, BUSINESS INTERRUPTION, OR
ANY OTHER DAMAGES WHETHER IN AN ACTION OF CONTRACT,
NEGLIGENCE OR OTHER TORTIOUS ACTION, ARISING OUT OF OR IN
CONNECTION WITH THE AVAILABILITY, USE, RELIANCE ON OR
INABILITY TO USE ANY INFORMATION AVAILABLE FROM THIS
DOCUMENT. IN NO EVENT SHALL The Project Doctor TOTAL LIABILITY
FOR CLAIMS, DAMAGES AND CAUSES OF ACTION, WHETHER IN
CONTRACT, TORT OR OTHERWISE, EXCEED THE AMOUNT PAID BY
YOU, IF ANY, FOR THIS DOCUMENT.

2 of 6

BMOJ 2007

The Project Doctor

1.0

www.bmoj.com

GENERAL
Back charges to a vendor or contractor are a possible source of conflict and
therefore, must be well documented. (A copy of the Notice of Back Charge is
attached as Appendix M to this Section.)

2.0

APPROVAL
When seeking approval for a back charge, the urgency of the remedial action
must first be determined. Secondly, the party being back charged shall be notified
by the Project Manager or Warehouse Supervisor.
a.

Urgent
Remedial work that cannot be deferred for reasons of schedule, downtime,
contractor standby, etc.
(1)

Make phone call asking for approval. On the Notice of Back


Charge form, note ALL pertinent information such as time, date,
name of person and position. (This information should be
completed in ink NOT pencil.)

(2)

Follow up the phone call with a letter, fax, e-mail or record of


conversation of the discussion and confirmation of your agreement.

(3)

In the event that the vendor refuses to accept the back charges, the
responsible Engineer or Warehouse Supervisor shall write a letter,
e-mail or fax stating the facts and informing the vendor concerned
that the back charges will be deducted from his hold back and work,
and that his acknowledgment is requested. Recommend he send a
representative to review the matter with the company at the site, if
so required.

3 of 6

BMOJ 2007

The Project Doctor

b.

www.bmoj.com

Less Urgent
Work that may be deferred temporarily.
(1)

Communicate by telephone, fax, letter, or e-mail, state the reason


for the back charge, a brief description of defect, remedial work and
temporary measure required.

(2)

Request advice regarding his preference to have the remedial work


carried out such as will he arrange or will we arrange. (He must
be given this opportunity).

(3)

State the latest completion time and date the company will accept
repair or replacement to be completed.

(4)

Ask if it is his intention to send a representative to the site, and


when.

(5)

Distribution of correspondence related to and advising of back


charges is:

Vendor or contractor being back charged


Owners representative
Field Accountant
Contract Administrator
Project Manager
Originator

3.0

- original
- one copy
- one copy
- one copy attached to F.W.O.
- one copy
- one copy

RESPONSIBILITIES

4 of 6

BMOJ 2007

The Project Doctor

a.

www.bmoj.com

The Project Manager has the overall responsibility for ensuring that
proper notification of observed defects leading to possible back charges is
given and for obtaining approval for back charges arising as well as issuing
F.W.O.s for remedial work.

b.

The Warehouse Supervisor has the responsibility of obtaining


approval from vendors and contractors for back charges resulting from off
loading or warehousing accidents

c.

The Field Accountant is responsible for all accounting aspects of a back


charge.
(1)

Along with the Notice of Back Charge forms, the Field Accountant
will furnish the owner with copies of all pertinent correspondence
including daily timesheets. Before transmitting a Notice of Back
Charge to the client, the Contract Administrator will review it with
the originator of the F.W.O. to confirm that the back charge is still
legitimate. The originator (usually the Project Manager) may wish
to review the charges with the firm being back charged and obtain
its acceptance of the amounts prior to the issue of a Notice of Back
Charge. Any contentious items should be brought to the attention
of the Project Manager by the Contract Administrator. If, after
review, the charge is not considered appropriate, revised F.W.O.s
will be issued to make the appropriate charge to the applicable cost
code and to reduce or increase the charge.

(2)

Whenever the firm being back charged maintains a representative


at the site, the timesheets for the work will be transmitted to him
for approval.

5 of 6

BMOJ 2007

The Project Doctor

(3)

www.bmoj.com

It is most important that the Notice of Back Charge be issued


before all payments are made to the firm being back charged, so
that the amount of the back charge may be deducted from the
amount to be paid by the owner. Therefore, it is essential that the
F.W.O. invoices be received and processed promptly. The Field
Accountant should review all F.W.Os every month and should take,
in conjunction with the Project Manager, whatever action may be
necessary to obtain the necessary invoices from the contractor.

(4)

The Project Manager and the Field Accountant should review the
Accounts Receivable position from time to time to determine
whether any substantial amounts may have to be charged to the
direct areas as this may effect the cost to complete portion of the
budget.

6 of 6

BMOJ 2007