Module 4: Common types of corruption in project construction
In relation to the same facts as are contained in the previous example, the project owner receives a copy of the extension of time application by the contractor. The project owner is aware that the contractor is entitled to an extension of time in relation to the variation to the specification, but is unsure of how many days should be granted. Both the project engineer and the project owner are unaware of the supply contract delay. The project engineer informs the project owner that in its objective view, it believes that 20 days extension of time should be issued to the contractor for the variation, but the rest of the application should be rejected. The project owner is unwilling to bear the additional contractor costs and loss of liquidated damages which a 20 day extension of time would result in, and so persuades the engineer, with the promise of employment on the project owner’s next project, that the engineer should refuse the contractor’s claim in its entirety, and should instead issue a certificate requiring the contractor to pay the project owner liquidated damages for 60 days delay. The engineer does so.
The project owner knows that some days of delay are attributable to the project owner. The project engineer has indicated that, in its view, 20 days delay are attributable to the project owner. The project owner is entitled to provide evidence to the project engineer which shows otherwise, with a view to changing the engineer’s mind. However, the project owner is not entitled to improperly influence the objective decision-making function of the project engineer. In this case, the project owner attempts to improperly influence the project engineer through the offer of future employment. This is bribery by the project owner of the project engineer. The project engineer accepts, which is both bribery and abuse of power by the project engineer.
April 2025
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