A senior engineer of a public body was assigned to supervise the construction work of the organisation's new headquarters.  In the process of calling tenders for curtain walling works, a contractor and a close associate of the senior engineer indicated immense interest in the project.

Just before an official invitation for tendering was issued, the contractor offered to secure a highly sought-after golf club membership for the senior engineer to exchange for his assistance in winning the tender.  He requested the senior engineer to manipulate tender requirements to suit his company so that he could obtain the contract for the job.  In fact, the contractor charged a much higher rate than the other construction companies and the technical processes for constructing the curtain walling were not cost-efficient.

A senior engineer of an engineering consultant firm recently undertook to oversee a large private housing project.  Owing to frequent contact, he got along famously with a contractor who was around his age and shared his interest in golfing.

On one occasion, the contractor treated the senior engineer to a lavish meal in the Country Club and then revealed his hidden agenda.  He said that the funds for the housing project were quite short and he wished to have more allowances for contingencies.  As the senior engineer could approve claims for additional costs, the contractor tried persuading him to exercise his discretion and add $5,000,000 to the project.  As a token of thanks, the contractor promised to treat the engineer to a luxurious overseas golf trip.

An engineering graduate joined a construction company as an assistant engineer and was responsible for collecting tenders for specialist services.  He came to know a sub-contractor who was particularly on good terms with him as they were both e-sports lovers.

When time came for a tender to be made for a fire-proofing job, the sub-contractor invited the assistant engineer out to a sumptuous dinner over which he suggested a deal.  The assistant engineer was suggested to go through the tenders secretly and inform the sub-contractor about the lowest bid by texting a code to him. The sub-contractor would then beat that price and get his bid in just before the closing time.  In return, the sub-contractor promised to give the assistant engineer a big "laisee" in the coming Lunar New Year.  To win the young fellow over, the sub-contractor said that someone would get the project any way and he was as good as anyone else.

A senior engineer of a construction consulting firm, who had obtained the information of a large scale private housing development project through participating in its planning work, attempted to make money by selling the restricted information.

The senior engineer sought his brother's help to carry out the plot.  Before formal invitations for tenders were made public, the senior engineer's brother approached a middleman and asked him to look for a contractor who would be interested in the project.  He said he had restricted information to offer which could assist the tenderer to obtain the contract.  In return, he asked for 10% of the contract price as a reward and promised to share part of the profits with the middleman.

Using a number of false invoices, a company's lift maintenance engineer conspired with two maintenance supervisors and a sub-contractor to defraud his company by claiming that certain jobs were carried out by the sub-contractor whereas the jobs were actually done by the maintenance engineer's subordinates.  The offences came to light when one of the company’s workers who carried out the jobs suspected irregularities and reported to the ICAC.

A government chief engineer took advantage of his office to solicit $400,000 from a project manager of a land development company as a reward for assisting the latter to obtain green light for the company's carpark development project.

Subsequent to the first application of the project being turned down by the relevant government department, the chief engineer asked for the advantage from the company. Frustrated at being asked to pay bribes to secure the project, the project manager reported the case to the ICAC.

An air-conditioning equipment supplier provided spare parts to an engineering company for an air-conditioning project of a large exhibition centre. As some of the parts supplied broke down due to manufacturing fault, the supplier engaged a sub-contractor to carry out repairing work at its own expenses. The work, however, was done unsatisfactorily. The engineering company subsequently reallocated the work to its own contractor and assigned an engineer to supervise the work. The supplier thus approached the engineer in a bid to get the job back to his sub-contractor and promised to reward the engineer by a sum of cash.

The engineer refused the offer and reported the matter to the ICAC.

In January 2001, Lee & Wong Holdings Ltd (LW) awarded a $1,000 million contract to a main contractor for constructing four 40-storey residential blocks, a commercial complex and a car park.   The main contractor then sub-contracted  the  piling  work  to  another  company.    The  latter  in  turn awarded the work to Saar Piling Company Ltd (Saar) by simply deducting 15% of his original successful bid.  LW also appointed a consultant firm Joe & Partners (JP) to oversee the construction work.   The project was scheduled to be completed in twenty months and five months were allowed for the piling works.

JP deployed an engineer as the Project Manager (PM) to oversee the project but he was not required to be resident on site.   Occasionally, he would go to the site for meetings but did not carry out site inspections himself. Routine site inspection was left to an Assistant Inspector of Works (AIoW) and a Works Supervisor (WS) who were resident site staff appointed by JP. However, the AIoW had very limited experience in piling work.

As there were only two supervisory staff on site responsible for overseeing the whole piling works, the AIoW and the WS found it difficult to check every detail during the work process.  They could only rely on the records of Saar and sign the completion forms taking the face value without checking.

Due to unexpected difficulty encountered during the placing of reinforcement casings, LAM, Director of Saar, found that the piling work was behind schedule and a one-month delay was anticipated.   Saar, being a small sub-contracting company, found it difficult to bear possible substantial liquidated damage (LD) of $800,000 per day as stipulated under the main contract.

LAM then discussed the making of shortened piles with the foreman and site agent of the main contractor, who were always away from work and thus failed to monitor the work progress.  They thought that the specifications stipulated in the contract were conservative and shortened piles should cause no severe harm to the completed buildings resting on top of the piles.   They believed that the buildings would not be structurally affected.

LAM instructed his workers not to excavate the pile bores as deep as the proposed founding levels.   Instead, after the length of the reinforcement casings had been checked by the supervisory staff of JP, LAM asked his workers to cut the casings during night time when the consultant site supervisory staff were off duty.   LAM then manipulated a measuring tape by removing parts of its central portion so that it gave a reading longer than the actual measurement.   When the supervisory staff of JP measured the pile bore depth using the manipulated measuring tape provided and re-examined the reinforcement casing, they were not able to detect that the piles had been shortened.

One day, the WS of JP discovered that the length of the constructed piles did not match with the concrete delivery records for the piles.   He suspected that some of the piles might have been shortened.   He immediately approached LAM for an explanation for the irregularities discovered and the proposals for remedial actions.

LAM, after discussion with the foreman and site agent, went to the WS’s office to hand him an envelope containing $300,000 and plead him to turn a blind eye to the substandard piling works.   The WS immediately refused LAM’s request.

The WS immediately  reported LAM’s  offering of bribes to the ICAC. LAM, the site foreman and site agent of the main contractor were arrested and convicted of conspiracy to offer an advantage to the WS as a reward for turning a blind eye on substandard piling work.

Questions

1. Why were LAM, the foreman and site agent convicted of corruption offences? What actions should you take when being offered bribes?
2. How devastating would the damages be if a construction professional accepts advantages for turning a blind eye to substandard works? What are the consequences of such behaviour?
3. What is the importance of site supervision at a construction site?

Lennon was a foreman working in the Hong Kong Harbour Engineering Company Limited which was a contractor carrying out the sanitary landfill and associated works at the Sai Kung Landfill.

One of the duties of Lennon was to evict gleaners from the landfill site as it was laid down very clearly that no salvage of any material within the site was permitted. There was a large sign displayed at the entrance of the site in both Chinese and English which could cause no misunderstanding.

Lennon had an old friend Gary who was unfortunately laid off a few months ago.  After much effort, Gary finally started a recycling business.  He approached Lennon one day asking to be allowed to send his men around to see what could be salvaged.  He promised that it would be done very discreetly and unobtrusively.  There were various arguments between the two. Gary doubted if Lennon would have anything to lose because he was merely lending a helping hand by turning a blind eye.  Gary stressed that it was all for a good cause, that environmental protection was the duty of every global citizen and that no real victims or suffering parties were involved.  Gary continued to persuade Lennon that the rules could always be bent a little bit.  The important thing was not to disturb the operation of the landfill.

Lennon thought to himself, “Should I help my old friend out?  He was an unfortunate guy.  Must I adhere to the rules laid down by the firm?  Gary was quite right.  What have I got to lose?  Why can’t I have a say in things as minor as these?  Maybe at the end of the day, I can still say I have evicted Gary’s people but not after they have had a chance to glean through the stuff a bit.  These practice was common in construction sites.”

A Government Department (the Department) awarded a slope maintenance  contract  to  Chongs  Construction  Company  Ltd,  which  then sub-contracted the works to JKW Subcontracting Company (JKW), of which CHEUNG was the proprietor.

From time to time, the Department issued to the contractor works orders (WOs) describing the work required, location and estimated value of the work. Upon completion of work, an Inspector of Works (IoW) of the Department would physically inspect and verify whether the work done was in compliance with the required standard.   Based on the recommendation made by the IoW, the project engineer would approve payment to the contractor by signing on the WO concerned.   He was not required to physically inspect every piece of work completed as over a hundred WOs were issued every month.

When the engineer signed on the WO, the contractor could apply for payment by submitting the WO to the Accounting Section of the Department. A contractor could only apply for payment on completion of work as certified on the WO.

In conjunction with the payment process, the Quantity Surveying Section of the Department counter-checked the work of the contractor.   However, the Quantity Surveyors of the Section could only randomly check 10% of the WOs issued.   Both the project engineer and the quantity surveyors might therefore not be able to detect abuse in relation to the WOs.

YAU was an IoW of the Department responsible for overseeing the works carried out by JKW.   In March 2000, CHEUNG approached YAU and urged YAU to expedite the checking of WOs. Hence, CHEUNG could receive payment earlier.   In return, CHEUNG offered YAU a part-time job with $8,000 a month.

Between April 2000 and December 2001, YAU accepted a part-time job from CHEUNG as a reward for expediting the checking of WOs issued to CHEUNG.   On many occasions, YAU certified work completion on the WOs though the work concerned had not even commenced.

YAU and CHEUNG were later arrested by the ICAC and were found guilty of offences under Section 4 of the Prevention of Bribery Ordinance (POBO).   Both YAU and CHEUNG were sentenced to imprisonment.

Questions

1. How did YAU and CHEUNG violate Section 4 of the Prevention of Bribery Ordinance?

2. Besides the offer of a part-time job, what else can be classified as an“advantage”?

3. What should be watched out for in site supervision to prevent malpractice?