Case Study | Navigating Complex Manufacturing Disputes with Forensic Investigation and Quantum Analysis

Overview

DAC Consulting Services was engaged to provide independent delay and quantum expert analysis in a major international arbitration concerning the expansion of a large integrated steel manufacturing complex in India.

The dispute arose from significant schedule overruns and cost escalation during the design, procurement, and construction of a new structural mill facility. The works were executed under a lump-sum turnkey contract incorporating FIDIC-based conditions, governed by Indian law, and administered under the ICC Rules of Arbitration.

Scope of Work

DAC’s appointment covered a comprehensive expert assessment of both time and cost issues, including:

Determining the causes and extent of project delays, analysing the critical path to completion, and the sequence of key contractual milestones.
Quantifying financial entitlements related to unpaid invoices, escalation, prolongation, and withheld guarantees.
Assessing the effect of employer and external factors on the overall project schedule and contractual performance.

The expert team produced independent delay and quantum reports, addressing claims exceeding INR 83 crore, supported by contemporaneous records, schedules, and payment data.

Methodology

DAC’s delay analysis adopted a windows-based approach, using contemporaneous baseline and progress updates to help identify excusable and compensable delays. The analysis focused on late design approvals, restricted site access, and extended commissioning sequences impacting mechanical completion and acceptance milestones.

The quantum analysis covered:

Outstanding payments and milestone certificates;
Price variation and escalation under the contractual formula;
Extended supervision and management costs due to prolongation;
Losses from encashed performance securities and withheld statutory dues.

All calculations were prepared in accordance with the contract’s commercial framework and supported by contemporaneous documentation and accounting evidence.

Outcome

DAC’s independent findings assisted the legal team and the arbitral tribunal in understanding

the technical interrelation between delay events and their financial consequences. The

coordinated presentation of delay and quantum evidence provided a clear and defensible

foundation for the claims and contributed to the resolution of complex issues surrounding

schedule entitlement and cost recovery.