ProActive Management Systems received high marks for its management of the Berkeley site and the quality of the work done, according to the latest risk assessment prepared for Argus Insurance by independent consultants.

And, the consultant reported, significant delays were caused by the Works Ministry?s technical officers and a Canadian architectural firm it contracted for design work. Argus Insurance decided to renew its insurance cover on the project after receiving the report.

?We were very impressed with the site, the order and cleanliness throughout, with a very good standard of workmanship being displayed in all areas seen by us,? the report stated in its summary.

?The insured has certainly been hampered in the completion of the works by factors that were outside his direct control and he may also be guilty of some contractual naivety, as well as an overly simplistic timeline for the completion of the remaining works.?

The report, dated May 2004, was prepared by London-based Cunningham Lindsey, an international loss adjusting and claims management firm.

It was commissioned in mid May by Argus Insurance which had provided a total of more than $82 million worth of insurance cover for the work done by ProActive, including public liability coverage of $2 million.

The insurance coverage was due to expire the following month. Cunningham surveyed the site on May 15 and met with ProActive on May 17.

They found that the site was ?substantially complete in terms of the main structural elements? and found that the ?works appeared to be well ordered, and the site was neat and tidy, with no accumulations of debris evident.

?The works seem to be well organised and from what we could see, are being undertaken to a very good standard throughout,? the ten-page report continued. ?The works completed to date also appear to be to a good standard throughout and better than we have seen in many areas of the Island, with details and finishes being neat and well put together throughout.

?The job itself calls for a relatively large number of architectural ?details? such as window arches, false windows and moulded finishes to concrete which again all appear to have been undertaken to a high standard.?

Industry safety and security standards were all being adhered to, the consultants found. ?In all we consider that this attention to detail is indicative of a well run and managed contract, and we could find no real fault with any of the areas that we looked at during our visit.?

Addressing the fact that the work had fallen way behind schedule, the report says that Mr. Ebbin had found design mistakes from the very start.

One initial cause for delay, accounting for two to three months lost, was that a wall had been initially designed as free standing and had to be redesigned as a retainer wall. Hurricane Fabian also took its toll, with two months lost. But a 300 day delay was attributable to a redesign of structural steel for walls and roofing elements.

?This appears to have been due to an initial under design of these items by the Canadian architects appointed by the Owner (the Works Ministry), and as a result of this redesign the steel, which had to be imported from Canada was around 300 days late in arriving at the site. Clearly this is a situation which is outside the control of the Insured.?

?Mr. Ebbin also appears to be very frustrated by the number of change orders that have been issued by the owner and their representatives since the works began, whereby to date over 300 changes have been requested and over 600 requests for information have been received.

?Some of these changes have been major items involving substantial changes in the way that the works have thereafter to be undertaken.?

The consultants found that the contractor was also guilty of some ?non conformance to works and specifications,? the report continues.

But ?we were told that there had been around 30 non conformance notices issued to him by the owners representatives, all of which have been corrected and only one we are told was of any significance?.

And it points out that the contract would still have fallen behind schedule due to factors such as labour productivity and labour shortages, adding ?However the major factors are clearly those detailed above.?

And the consultants reported that a maximum workforce of 140 were on site at any one time and that ProActive was concerned about the installation of drywall linings and were recruiting workers from abroad.

?Items such as tiling and installation of the gym floor and equipment are all likely to be relatively time consuming, however the Insured remains confident that the majority of any delays are behind him.?

It goes on to say that ProActive expected to complete the job by November 1, but their own assessment was that it would not be completed until the end of the year ?or even the first month or so of 2005, assuming no major factors influence the works that remain?.

Another four or five months would be required for the Education Ministry to install their own facilities and ProActive was hoping to hand over the building well in time for the start of the September 2005 school year.

?We understand that the Insured remains in discussions with the Bermuda Government relative to payments for extra works and the like, and clearly there have been modifications to the original contract period and sum that the Government has agreed to, as to date we do not believe that any liquidated damages are being levied against the Insured.