Crown Build is a medium scale developer in Australia who is currently the Principal (Client) of an on-going construction of a medium scale mix use development project in a prominent location in NSW. The traditional procurement approach is used to acquire the project. Having finalised the design development stages of the project, the Principal selected Prime Construction as the suitable Contractor through competitive tendering. The project includes construction of high rise building. The project uses the ‘AS4000 – 1997’ as the form of construction contract. At the time of signing the contract, the contract sum was AUD 60 million and the contract period was 36 months. Contract included an advance payment. As per the contract, the contractor is paid monthly. Halfway through the construction of the superstructure of the building, the Contractor realises some structural deficiencies in the beam sizes. The Contractor informed the Superintendent of this unexpected situation in writing. Having consulted the Principal, the Superintendent issued new structural drawings with correct beam sizes. Furthermore, the Superintendent instructed to break the incorrect beam already constructed and replace them with new ones. The Contractor instructed its employees to proceed according to the instruction to break the beams and replace them with new once. In the meantime, Superintendent directed to change the floor finishes from ceramic tiles to granite upon Principal’s request. The Contractor is now preparing the tenth progress claim. Crown Build (Principal) wants Prime Construction (Contractor) to engage either Safe Elevators Pty Ltd or Edmon Lifts Pty Ltd supply and install the lifts in the building. Prime Construction (Contractor) planned to subcontract the supply and install External Curtain Walling to Horizon Facades Pty Ltd. 

Assuming that you are a Contract Administrator working for a Contractor, produce a report addressing the following.

Identify the variations applicable to the above project scenario and fully explain the procedure to be followed in directing these variations. Refer to the relevant AS4000-1997 clauses. You are not expected to copy and paste the clause. You can mention the clause number and briefly mention by your own words what the clause is about. Support the discussion with additional reading/literature.