INTERVIEWS

A remarkable personality – Dr. Sam Written by: P. Patabendi MRICS, MBA, ACIArb

Dr. Indrawansa Samaratunga (Dr. Sam) PhD, DSc, FRICS, FCIArb, FCIOB, FCMI is no stranger to the Sri Lankans living abroad or at home especially those who are involved in the construction industry for his rare talents and achievements. As Sri Lankans, we all should be very proud of him for making a history in the world’s construction industry, bypassing all the predecessors through his arguments and superior formula developed and being the first Asian Quantity Surveyor ever to do so.

Born in Matara as the second son of late Mr. Jinadasa Samaratunga and Mrs. Wimalawathie Mathangadeera Samaratunga, the highlights of Dr. Sam’s remarkable career have been the receiving of PhD and DSc doctorates in recognition of the new interpretations offered for the International Contracts and in developing a new formula for evaluation of overhead under recoveries in the construction industry. His doctoral thesis “Contract Administration in the Middle East under FIDIC 4th edition” is a book in waiting.
Dr. Sam’s formula is considered to be superior to the other four formulae currently in use in the construction industry, an account of which is given at the end of this article.

His combination of academic and professional qualifications is supposed to be the first such combination in the world, and he is also the only Sri Lankan registered as an Arbitrator with Dubai Chamber of Commerce. In addition to being an academic he has also been a Film producer, a Yoga guru, a Spiritual healer, a Personal counsellor and an Inventor of a lottery scheme, (SCORES) probably another first with such a combination.

At present, Dr. Sam is working as a Consultant to Construction Industry Employers and Contractors in the Middle East on Contract Administration and Dispute Resolution matters. Though he is an extremely busy person he has devoted his spare time as an honorary lecturer at the regular seminars conducted for the professional development of the Sri Lankan Quantity Surveyors currently residing in UAE.

He had his education at St. Servatius College Matara and at Institute of Practical Technology, Katubedda (now the University of Moratuwa, Sri Lanka). His Quantity Surveying career started at the State Engineering Corporation of Sri Lanka in 1966. After being in the Sultanate of Oman for 21 years, he has now been in Dubai for 8 years with his wife Shiranthi (nee De Saram of Gampaha) an attorney-at-law and two daughters Rantilini Sakunika and Harindu Sandamini.

In his doctoral thesis, Dr. Sam introduces a new formula to the Construction Industry for assessment of underrecoveries in head office overhead costs of a Contractor during prolongation.

In his discussion regarding the existing well known formulae, Dr. Sam submits that:-Hudson formula and Emden formula are not suitable for this purpose because both deals with apportionment of a head office overhead component priced in the past by a Contractor in his tender, to a prolongation subsequently occurred in the future (present), whereas FIDIC Conditions require actual costs to be determined in this respect.

Eichleay formula, though takes into consideration the actual head office overhead costs, also considers such costs for the total project duration without limiting it to the prolongation prior to apportionment, thus contravening with the actual costs requirements of FIDIC

Hank Laan formula however, deals with the actual head office overhead costs during prolongation, but its apportionment to the delayed project is offered on the basis of Contractor’s invoicing for the project vis-à-vis total invoicing of Contractor’s organization as a whole, which would not be an acceptable method to either the Employer (or the Contractor) where a disproportionate amount of the Works is completed and invoiced during the prolongation.

Dr. Sam also submits several other arguments as to why these four formulae cannot be used (except, of course, by mutual agreement) to determine the actual costs referred to in FIDIC conditions, and the details of which are not included here due to the limitations of space.

For the benefit of our readers, I reproduce Dr. Sam’s formula here below, with his permission:-

Reimbursement of head office overhead underrecovery = H   X
    CP    
   SCP

 

H  =  Actual total head office overhead cost of the Contractor’s organization for the period of compensable delay (prolongation)

CP  =  Contract Price of the delayed project divided by its Time for Completion and multiplied by the period of compensable delay

SCP  =  Sum total of Contract Price of each concurrent project divided by its Time for Completion and multiplied by whole or part period of compensable delay through Which, it was in progress taking into consideration all projects in progress at the time.

As you can see, this new formula would comply with FIDIC requirements because it takes into consideration, the actual cost during prolongation. Further, the method of its apportionment to the delayed project is presented in a more acceptable manner not only by avoiding the unacceptable use of a basis such as invoicing, but also by allowing provision for other projects with a head or a tail into the prolongation period to fairly bear part of the overall actual head office overhead costs during such prolongation. Since this would be a method acceptable both to Employers and Contractors, the formula could be used by the Engineer or a subsequent Arbitrator, where the parties have not mutually agreed on an applicable method. Accordingly, Samaratunga Formula could be considered as superior to other formulae, currently in use, in the industry for assessment of underrecovery of overheads.

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