1. Dear Sir, According to Sub clause 4.2 FIDIC 1999, The Contractor shall obtain (at his cost) a Performance Security for proper
    performance,… No amendment of this sub clause was made in the Particular Conditions. But there is item in the BoQ to pay for the performance security. The question is if the payment is due?

    Thank you and BR,

    1. Dear Kahn
      The contractor was aware that he is to procure the bond on his cost that is why hehas already included such cost in the BOQ as part of the site preliminaries. As such, he is entitled for that item.

  2. Dear Mr. Samer,
    Can you pls. advise the contractual / legal solution for the Contractor on the below issue.
    Under the main form of contract FIDIC 1987, the Contractor received an Engineer’s instruction to re-work the painting finish as the client requested a change in the colour of the external wall surface. This instruction came through after the Contractor had finished the External painting with a height of 15 meter based on originally approved contract specification and colour. The Contractor had also dismantled the scaffolding and returned the scaffolding materials to their central store yard.
    Based on the above Engineer’s Instruction, the Contractor had again mobilised the scaffolding material from their central store yard and re-erected the scaffolding and completed the re-work as per the Engineers instruction.
    Since the Contractor had erected the scaffolding specifically for the painting re-work instruction, the cost of scaffolding was not deemed to be included in what the Contractor had originally allowed for scaffolding cost within the BOQ price for External painting. Hence, the Contractor had notified the same to the Consultants and claimed the painting by using the contract BOQ price, less the percentage of preliminaries (which is inclusive of scaffolding cost originally allowed) and added the actual cost of Scaffolding for these re-works.
    During the evaluation of above variation by the Engineer, they rejected the additional cost of scaffolding (based on the actual cost) and informed to the Contractor that according to the contract Clause 52 (1), all the variation work done by order of the Engineer shall be valued at the rates and prices set out in the Bill of Quantities, if and to the extent, in the opinion of the Engineer, the same shall be applicable. Hence, the Consultants had considered the same rate as per BOQ for the painting re-work.
    What do we need to do to find out a appropriate response to the Consultants which would safeguard the interests of all the parties involved.

    1. Dear Krish
      Let me clarify some issues first. The cost of scaffolding as temporary equipment is included in preliminaries while the erection and dismantling is included in the rate of the work in which the scaffolding was used for.

      The BoQ rate is applicable in variations if such variation is done within the normal sequence of activities and where the nature of the work has not changed. In your case, the scaffolding was removed from site after completion of the relevant activities.

      This would mean that the paint rate shall be used as it is in addition to the cost (as well as the relevant profit) of hiring and bringing the scaffolding back to site and demobilizing it later on for this specific task.

  3. Dear Mr. Samer,

    Good morning I got an issue in my variation in which the contractor base their cost saving in remeasured drawing quantity in which in BOQ the quantity is much more than the shop drawing.Which will govern the BOQ or the revised drawings. the contract is Lump sum?

    Thank you and regards,

    1. Dear Tol

      The BOQ is only acting as a schedule of rates. Any variation (addition or omission) should be assessed from the actual quantities measured from drawings. You may refer to many other previous questions in this page for more details.

  4. Does liquidated damage be applicable in a consultancy form of contract ?
    In this case, the consultant is 100% paid upon completion of the study and submission of the assessment report

    1. Dear Rennie

      If LDs are stated in the consutlancy contract, then the consultant will be laible to pay the relevent amount upon delay.

      In some countries like the UAE, the court may opt to waive part or whole of LDs depending on the case and actual loss incurred by the Employer due to the delay.

  5. Kindly guide me on the Main Contractor’s repeated request for extension of performance bond .project commencement in April ’14 Original Completion period was in July 14 . Performance bond was given to cover this period . later they asked extension till Dec 14 and then till June 15 which was done . Now main contractor is again requesting for extension of performance bond till project completion . The subcontract work is 99.5 % completed , pending work due to lack of clearance from Main Contractor.

    1. Dear Ashfaq

      Standard forms of subcontract requires unconditional performance bond to be available till the practical completion then revised to cover the defect liability period.

  6. Hi,

    I would like to ask if the company (interior design) can claim from original contract when the owner/designer change the design.

    We have a signed contract and during the process the designer change the design and give to other contractor. Result, that items will be deduct to our contract. Kindly give us further information with this situation and can we claims loss of profit with this matter.

    Thank you.

    1. Dear Jessa

      If the work was omitted from your contract and given to others while your expertise allows you to do such work as variation to the contract, then you will be entitlted to claim loss of opprotunity from the Employer.

  7. Hi,
    I am working on a project that there was an unforeseen physical condition encountered in the project set back.
    1- would the Contractor be entitled for time and cost if the design limit falls away from the set back limit / while it was a contractor’s choice to make the design build shoring in the set back limit
    2- what about the risk / who is liable for the risk if damages occur

    Thanks

    1. Dear AAAa

      Thisi s a very interesting question. The contractor will have difficulty to justify his claim for compensation since he was supposed to abide by the plot limits unless it is practically impossible to accomodate shoring system without changing the building design.

  8. Hi,
    I would like to ask if it is not contractual as a Contractor to issue notices for delay and time extension in accordance with the Contract (SCl 8.4, 20.1, etc..), if an event is not surely or likely to affect the time for completion.
    Noting that EOT claim will surely not be submitted at a later stage if no evidence would prove impacting time for completion.

    The intention of the notice, would be just:
    1. to reserve the Contractor’s right for delays/costs if incurred, or
    2. highlighting employer’s events – for record, or
    3. stating concurrency (disruptions/re-sequencing impact) esp if at the end the Contractor caused delays
    Thanks

    1. Hi AAAa

      It is a contractual approach to serve delay notices whether the physical delay is going to happen or likely to happen. However, you may need to be careful not to abuse the benefit of serving notices since the Engineer should not be distracted with tens of unjustified notices.

  9. Shashi Thomas

    Dear Sir,
    We are a specialist company that designs and manufacturers Horse Stable Doors windows stall front etc. We had recently completed a 81 stall project in Abu Dhabi through a contracting company.
    Recently the VIP client has the same contracting company to build another stable to accomodite 41 horses, the contractor has taken the shop drawings that we had provided after we completed the first set 81 stall project and given it someother fabricating company to manufacture the stall fronts the main barn doors.
    Is this legal, as the design of the stall doors are from my company and we had submitted the shop drawings to both the contractor and the conslutants as required by the contract. Please advise.
    I think it is morally not correct what they have done.
    Regards
    Shashi Thomas
    Stableforce Trading LLc, Dubai

    1. Dear Shashi

      Under FIDIC yellow book (design and build), the contractor intllecutual property rights are protected pursuant to clause 1.10. In your case, if the cotnract is silent about this, you may need legal advice to see how the UAE civil code deal with this matter and I think it gives you similar protection.

  10. Hi Samer,

    I hope you are well.

    I am working based on FIDIC Red Book Contract in Abu Dhabi. Can the ‘certified payment due date’ forwarded by the Engineer to the Employer for payment be revised?

    For example, the Engineer certified that the payment due date is on 31 May 2015 but due to some issues on the supporting documents received from the Contractor, the payment due date is now to be revised to 15 June 2015.

    Appreciate your thoughts.

    Thanks.

    1. Dear Isamil

      If the Contractor did not cause any delay in the certification of the progress payment, the engineer must certify the payment in accordance with the contract and payment due date must be respected by the Employer.

      Sometimes, you need to use politics with the Engineer so it is not in your favour to upset him with such issue unless the matter is crucial for yuor survival.

  11. Hi,

    I am working on a ICD 2011 form of contract with contractors design. The client has asked to undertake the final clean of the building direct. Can they adjust our prelims and omit the cost we had in for this?

    Thanks

    1. Dear Andrew

      If the final clean of the building is variation to the contract, then it should be measured in accordance with the relevant clause.

      If it is part of the contract but you do not wish to do the work, you may have mutual agreement to omit relevant item from prelims. If no agreement is reached, you will be obliged to clean at no extra cost or time.

  12. Respected Sir,

    AoA. I was please to find you out as I was needed help from some professional person….The case is

    I have come 2 recent project 1.5 years ago on Engineer’s side, the details of the Contract are,
    Commencement date: 12 Dec 2009
    Contract Completion period: 365 days
    Contract Completion date : 11 Dec 2010

    Engineer validate EoT-1 of 450 days upto 5th Mar 2012 based on admissible Delaying events considering cut-off date to be 31st Dec 2012. THe gap between cut-off date and extended time is approximately 10 months.

    Now the project further delays, and Engineer did not want to impose LDs to the Contractor, how the gap of 10 months can be removed??

    1. We can include no additional event as all possible events have been included earlier

    2. Can we increase EoT-1 by extending the time of already approved delaying events, if so, Would we able to justify such changing to Employer??

    Sir, ur co-operation will be highly appreciated..

    1. Dear Muhammad

      I am not sure if I get you correctly. In general, the Engineer can correct his determination based on the actual facts and can’t fabricate determination as it will be a breach of his duties to the Employer.

  13. We have s project with FIDIC 1999. please advice, if engineer not responding to contractor letters more than a week period and some cause the engineer response to contractor letters after a month period.what is the clauses for above issues.kindly give references from FIDIC.

    1. dear Anwar

      Please refer to clause 8.3. You should notify the Engineer of consequences of any delay in issuing instructions or responding to queries.

  14. Ephraim Abdissa

    I am working for a Contractor on Design-Build Road Project with the condition of FIDIC 1995. I subcontracted the Design work of the project to a Design Firm and requested the Employer to approve my employment of the the Sub-Contractor. The Employer of the project neither approved nor rejected my request. No question about the qualifications of the designers. Shouldn’t the Employer respond?

    1. Dear Ephraim

      Clause 4.5 b of the FIDIC orange book requires the prior consent of the Employer if your designer/subcontractor was not named in the contract.

      You may serve the Employer a notice of delay if such consent is not received within a reasonable time, then you make a claim accordingly.

  15. Dear Samer,
    We have the DREC conditions of contract on our project which is similar to FIDIC, the project comprises of 3 towers (residential/hotel/retail).
    In the start of the project we had got a variation in Guniting thickness that we did for which we had done an oral notification for all the three buildings, the engineer approved the oral variation and as a matter of relation we did not give a written claim, accordingly while submitting the variation order the engineer outrighlty rejected saying that according to the contract you have to provide a notice.
    Now we are in a loss of 1.5 million AED due to that , how to recover in such condition ?

    1. Dear Shahzad

      First, check reports, drawings, inspections and other project documents to see where the Engineer has issued such instruction or at least was aware and accepted the change in thickness. Perhaps, drawings may be the main document. You can prepare your claim accordingly.

      The alternative is to dispute the case based on “unjust enrichment” principle but you may need legal advice to prepare your claim. In my experience, the chance of success is pretty high in these cases.

  16. dear Samer
    please advise the steps and procedure that the client should be followed to redraw the performance bond from the contractor and how the contractor have to respond , in case he dont agree on that

    1. Dear Raed

      Pursuant to clause 10.3: “Prior to making a claim under the performance security the Employer shall, in every case, notify the Contractor stating the nature of the default in respect of which the claim is to be made.”

      This is the only obligation on the Employer. It is so easy to liquidate uncondiational bonds. However, the Contractor may file urgent court case to stop the Employer action from cashing the bond but he needs legal advice.

  17. Dear Sir
    Whether The Engineer can ommit an ‘Item’ of the Works from the Work Scope. Because Clause 51.1 (b) of the Fidic 1987/1992 speaks about the Ommission of Work, not the Item ?
    Your valuable advice is requested.
    Regards
    MF

    1. Dear MF

      Yes, he can omit any work or item provided he does not give it to someone else. However, where the revised contract value becomes less than original value by more than 15%, the contractor will be eligible to claim for adjustment of his HO overheads pursuant to clause 52.3

  18. If the FIDIC red book based contract was entered into between the parties and after a period of time, but before the end of the contract period, the parties have mutually agreed to terminate the contract and proceed with another form of contract.
    Would a a mutual termination agreement suffice in terminating the first contract?

  19. Gentleman,please your advice. We have a FIDIC based contract, which requires to provide Performance Security for 10%of contract sum and has provided a format for Performance Bond. As banks have reservations to provide PB as per the contract format and the client has refused to accept the bank’s format, the PB could not be submitted as per contract requirement. We proposed to hold money amounting to 10% of contract sum form our bill against PB till expiry of defect liability period as more than 25% of the works has been executed and billed, which client has refused. They have kept on hold our due bill as PB has not been submitted as per contract. Does the client have right to refuse holding cash money in lieu of the PB? Do they have right to hold our bills and payment certificate till PB in acceptable format is submitted? What is the provision as per FIDIC in this case?

    Look forward for your valuable advise.

    1. I think you have FIDIC 1987. Regarding performance bond, refer to clause 10 states: “If the Contract requires the Contractor to obtain security for his proper performance of the Contract, he shall obtain and provide to the Employer such security within 15 days after the receipt of the Letter of Acceptance, in the sum stated in the Appendix to Tender. When providing such security to the Employer, the Contractor shall notify the Engineer of so doing. Such security shall be in the form annexed to these Conditions or in such other form as may be agreed between the Employer and the Contractor. The institution providing such security shall be subject to the approval of the Employer. The cost of complying with the requirements of this Clause shall be borne by the Contractor, unless the Contract otherwise provides.”

      If you fail to provide the PB in accordance with the above clause, clause 60.2 states the remedy of the Employer which states: “Notwithstanding the terms of this Clause or any other Clause of the Contract no amount will be certified by the Engineer for payment until the performance security, if required under the Contract, has been provided by the Contractor and approved by the Employer”.

      Generally, desperate contractors deposit 10% of the contract sum in the bank to get the PB. If this is unfeasible option for you, I would suggest you approach three different banks with the PB form and get their justification of rejection, then approach the Employer and propose alternatives. If he keeps rejecting and no paying monthly payments, you will have a strong claim against him as you already built the case that the failure is outside your control. Also, it may be the name and reputation of the Employer which hinders the bank to release such PB.

  20. I would someone to advice on Clause 39.2 of FIDIC red book, default of contractor in compliance and confirm if it is only applicable in the the contractor defaults in compliance with clause 39.1 or is applicable and valid in case the contractor fails to comply with any orders involving workmanship and material and included in the bill of quantities.

    Your advice will be highly appreciated

    Mohamed

    1. Dear Mohamed

      The clause is clear that it is only applicable where instruction has been given under clause 39.1. Clause 39.2 states: “In case of default on the part of the Contractor in carrying out SUCH instruction within the time specified therein or, if none, within a reasonable time, the Employer shall be entitled to employ and pay other persons to carry out the same and all costs consequent thereon or incidental thereto shall, after due consultation with the Employer and the Contractor, be determined by the Engineer and shall be recoverable from the Contractor by the Employer, and may be deducted by the Employer from any monies due or to become due to the Contractor and the Engineer shall notify the Contractor accordingly, with a copy to the Employer.”

      however, you may need to refer to other relevant clauses where failure to abide by the engineer instruction would be a breach of contract.

  21. is there a fairly standard TOR for the Engineer’s function for a project under execution available?

    1. Dear Liaqat,

      I am not sure if I understood what you are looking for. There is one good book in the library section about model letters for use in execution to help the Engineer perform his contractual role.

      I hope it will be of help.

  22. Hello Mr. Samer,
    I need to get an idea.
    We are a subcontractor for alum. & glazing works. We have an approved variation to install actuator to windows, the cost of which is 19.5% of the original contract value. The contractor is consistently on default in their payment of monthly dues, so we requested for an additional advance payment prior to purchasing the actuator motors, which they did not agree. Now the contractor is cancelling the variation. The full scope of the variation includes changes to the design of the windows which are already completely installed which means that the variation has already been commenced.
    Do the contractor have the contractual right to cancel the variation at this stage?
    I really hope you can shed light on my query. Thank you.

    1. Hi Rose

      I am not sure how your contract is drafted but generally speaking, the contractor has the right to impose additions and omissions on your subcontract.

      You should prepare a claim on the incurred expenses resulting from the instruction to cancel an instructed variation including the cost of materials, manufacturing, engineering, etc.. along with loss of profit. Make sure to include all necessary documents to support your claim.

  23. I have a question please.
    I am working for a Contractor
    Original Project Duration 24 months. Revised Duration 48 months as a consequence of the Employer’s risk events.
    EOT not yet finalized or agreed by the Contractor.

    The Contractor has already given Notices to the Engineer/Employer of his intention to claim all associated costs with EOT.

    My question is that can the Contractor ask for Rate revision of all BOQ items for the balance quantities during extended period. Rationale is that the contractor encountered delay due to employer risk events, change in Legislation resulted in enhanced tax rates, inflation etc.? Should be use Variation Clause coupled with 70.2 and clause 44.1

    1. Hi Usman

      You need to be very careful when claiming for varied rates due to project delays. Evidence is required regarding your assumptions and risk assessment of fluctuation during the tender stage. In general, you have the right to submit your claim pursuant to clause 53.1 and any other relevant clause. Your success depends on your ability to present evidence and records of incurred losses due to delays.

  24. I have a question Please!
    I am working on G+2 Building fully furnished.
    project duration 240 days.
    start date 03rd AUgust 2014
    In september consultant sent us a letter that there will be changes in external elevation.at that time we were ahead of schedule, they sent us letter on 06 Novemebr with drawings and ask us to proceed with. because of that we need extra time for steel designning and manufacturing, and additional block work including plaster and paint needed more duration, so we want to go for EOT, what will be the solution for that, what changes i have to meade in my schedule to submit them as attach documents

    1. Hi Abbas

      As a contractor, you need to select a delay analysis methodology that suites your case and demonstrate the incurred delays in the project. Usually, time impact analysis is the most reliable one. However, in simple projects, impact as planned methodology can be adopted as it is easily adopted and understood despite its inherent flaws.

      You may read more about these methods searching CMGuide.

  25. Mr.Samer,

    One of our Porject got delayed due to the reason, which is beyond the control of the Contractor. The Client also has agreed that the delay is not because of the Contractor and agreed to give EOT. At this juncture will the contractor is eligible to claim his associated cost due to extended time period. (ex:permanent power for the building got delayed, due to that contractor has to wait further to complete his final testing & commissioning works)

    1. Hi, of course, he can claim but should make sure all notices were given on time and there is a good record of the incurred actual cost due to delays.

  26. The Contract was awarded to complete all the contract works in 12 months. However, 27 months has passed, but the Contractor could able to complete only 49% of the contract works, since the Client did not finalize the balance works and wants to stop the project at this stage.
    In this case, kindly advise on the Contractor’s entitlement and the methodology to claim extended overhead for the Contractor in line with FIDIC 1987, Reprinted in 1992.

    1. Hi Arun

      You did not explain the reasons of delay. Anyway, the Employer is not entitled to terminate the contract for convenience. If he does so, the Contractor will be entitled to recover all incurred costs and loss of opportunity which may be extended to claim profit.

      What you need to do is to prepare your claim to address all the incurred delays using time impact analysis and write down the narratives of your claim, etc.. You may need to hire a claim consultant if the claim is complex and large.

  27. we got approval to the submitted time extension as Time, can the Consultant discuss the Concurrent delay after the Client approved the time to determine the compensable period.

    1. Dear Mamoun

      Usually, the EOT and prolongation cost claims for the delay event should be submitted within 42 days as per contract. I am not sure of your actual case, but would suggest that the Engineer not to delay the determination of cost unreasonably. Under FIDIC 1999, he has 42 days to do so.

  28. What will be role of the Engineer or Employer Representative consultant after Taking Over Certificate is been issued.

    Is he required full time on site or as when required.

    If the Time for completion of the project is extended, whom shall be liable to pay the Engineer after TOC has been issued.

    Does Contractor can object the presence of Engineer full time on site to minimise his costs and notify that the Engineer is required as when required.

    1. Dear Chand

      After TOC, snagging, testing & commissioning and contract administration will require the presence of the Engineer on site as appropriate to do the pending works. The Employer should pay the Engineer for the extended presence beyond TOC date.

      If the Contractor delays the date for completion, he will be liable for damages that will be covering the expenses of the Engineer’s presence on site. Sometimes, the contract calls for additional damages apart from liquidated damages to cover the Engineer’s fees for the extended period. The Contractor can raise an objection if the Engineer’s resources are much more than reasonably required for administering the extended period and he may have a valid case to claim.

  29. Dear Samer,

    in general cost plus contract, main contractor can claim subcontractors advance payment in monthly application.

    1. Advance payment should have separate arrangement for payment guarantee and recovery which should cover the full contract and should have dynamic adjustment as the estimated contract price goes up.

  30. Hi there,

    We are using FIDIC red book contract and the I need guidance whereby contractor is responsible to get approval from government agency including requesting and collating information from the client as part of approval request package.

    The contractor has raised an issue that he is not responsible for such info from the client.

    Regards

    Lawrence

    1. Dear Lawrence

      Please refer to clause 1.13 of FIDIC Red Book 1999 about compliance with law which determines what each party is obliged to do. If your issue is not covered in this clause, I suggest the Contractor to take the initiative in good faith to facilitate the approval and protect himself contractually for potential delays.

  31. Dear Samer,

    We are executing a design/build lump sum project under orange book conditions.
    In particular conditions under clause 5.1 the following has been added by the Employer:
    “The Employer has prepared Construction Documents for the whole of the Works.
    The Contractor shall check, review and amend those Construction Documents in line with the Employer’s Requirements as to design criteria.”
    In particular conditions under clause 1.1.1.2 the original clause has been deleted and replaced by:
    “Employer’s Requirements means: Design Criteria, Specifications, B.O.Q., Drawings, And any alterations and modifications thereto in accordance with the Contract.”
    The contractor is building up the following case:
    Pursuant to clause 1.1.6.2 of general conditions variation means any alteration and/or modification to the Emp. Requirements, which is instructed by the Emp. Representative …. in accordance with clause 14.
    The instruction for alteration and modification has already been provided under 2nd paragraph of clause 5.1 above, based on which the contractor is re-designing the works as per design criteria which is leading to modification to the works already defined in the drawings (Construction Documents) prepared by the Employer himself.
    To elaborate the following example could help.
    The total concrete foundations in B.O.Q. is 3,000m3 while the total foundations as per tender drawings is 3,500m3. The actual executed foundation on site after re-design based on design criteria is 5,000m3. The contractor is asking for the additional 1,500m3 based on the above case while knowing that the 500m3 difference between tender B.O.Q. and drawings cannot be asked for due to lump sum nature of the contract.

    Can you advise if the case above is valid or not?
    Best Regards,
    Gregory

    1. Dear Gregory

      The Contractor is not entitled for any variation unless the Employer has changed his requirements after contract signing that affected the design of foundations. As per your example, I understand that no change was enacted by the Employer as such.

  32. as we the engineers have given engineers instruction or notice to the contractors, but we want to get that back. is there is any procedure or any clause as per the fidic. or else what is procedure/solution to get the notice/engineers instruction back from the contractor as we the engineers/PMC. Please reply as soon as possible.

    1. Dear Arun

      The appropriate way is send further EI to the contractor to void the earlier instruction. This will keep the records and ensure good faith in contract administration among parties.

  33. I am working for Developer for a project where FIDIC 1987, 88 with Editorial Amendments and 1992 with further amendment is applied.

    We had PC Sum Items and PS Items in our contract with Contractor.

    There were certain design changes in July 2013 and drawings and all relevant details were forwarded to Contractor to start the works. However, Contractor did not submit any quotes/ details and only in Feb 2014 started submitting quotes.

    Q1) Contractor now is submitting quotes and getting our approvals. However, is claiming this as delay in Nomination? Please advise

    Q2) Contractor is having contract with these sub-contractors and we as Client are not having any control over them.

    Your advise would be appreciated.

    Kind Regards,
    Aziz

    1. Hi Aziz

      Under FIDIC, the Employer is obliged to appoint nominated subcontractors in line with the contractor’s programme of work. I am not sure if there is another contractual arrangement that puts an obligation on the Contractor to initiate the nomination by submitting quotes or offers for the Employer’s selection. if This is the case, then it will be difficult for the Contractor to be successful in his EOT claim as he has delayed the process.

      Once subcontractor is nominated and the Contractor entered into subcontract with him, the Main Contractor will be fully liable for his defaults. Please read my paper on nominated subcontractors which will give you better idea on this problematic area in FIDIC. You can download it from the library.

  34. Emmanuel Amankwah

    Dear Samer,
    May I know under which clause can the employer make a claim on a turnkey project from the contractor for not performing some of his scope of work and have to be done by others.

    Regards
    Emmanuel.

    1. Dear Emmanuel

      I assume you use FIDIC orange book 1995. I refer you to clause 7.5 (Rejection) and 12.4 a (Failure to Remedy Defects).

  35. Hi Samer Can you Please advise what does termination Costs under the FIDIC Green book cover. many Thanks SAlim

    1. Dear Salim

      I understand this termination is due to Employer’s default. The termination cost is well detailed under clause 12.4.

  36. Munir Youssef

    If the Client delays the issuance of the advance payment in a lumpsum contract and the contractor continues to work at site ,does the contractor have the rights to claim for an extension of time and how it is calculated ?

    1. Dear Munir

      You will be entitled for interest claim. Also, you can serve a notice of suspension if the payment is not released within the time stated in your contract. This will give you entitlement to claim EOT if the situation persists.

  37. My Question concerns the engineers estimate as prepared on a bill of quantities. I would like to know if the procuring entity has a right to access this estimate long before the day of actual evaluation of bids and subsequent award of contract.

    1. The question is not clear. If the case is about the entitlement of the Employer to access the estimate of tenderers before the bidding date, then he is not entitled.

  38. Muhammad Shaikh

    Dear Mr Samer,

    I would like to ask following questions (FIDIC 99-Design Build contract) & will be great full for your reply.
    1. Which clauses deal with the (slow progress) delay charges
    during in progress work, (Can ENGINEER issue letter to
    contractor to intent for delay charges in advance for slow
    progress ?
    2. Can ENGINEER suspend work due to safety issues (against which
    clause ?).
    3. Which is right sentence to write in bottom paragraph of claim
    letter ?
    a, “We reserve our right to claim……”
    b, “We intend to submit claim……..”

    Thankyou in anticipation

    Muhammad shaikh

    1. Dear Muhammed

      1- The Engineer has an obligation to administer the contract, hence he is required to alert the Contractor of any breach of contract with the potential damages. Having said that, the Engineer can’t recommend LDs unless the time for completion has elapsed and there was no proper EOT claim from the Contractor.

      2- Yes, he can if suspension would prevent proven safety hazard. Clause 3.3 covers such right.

      3- You need to have a proper phrase, that you hereby serve this notice of the intention to claim cost and/or time. Such claim should be submitted within 42 days from the notice.

  39. Dear Mr. Samer,

    We are working a project in Beirut under Fidic Red Book 1992. The situation is as follows:
    On March 2013 the Engineer left the site due to disagreement on financial compensation between him and the Employer disregarding his duties and responsibilities under the contract. On 14-June-2013 the contractor submitted his interim payment certificate #43 to the Employer. End June 2013 the Employer took on his behalf to release the Taking-Over Certificate without Engineer’s signature. Beginning of September-2013 the contractor submitted the Statement at Completion. Till today the contractor did not receive any certification on his submitted two payments. According to the Employer; and after settlement of disputes, the expected date of Engineer to enter site is end Feb-2013 before the end of defects liability period.
    Confronted with such situation my question is:
    1.- How the contractor should consider the legal standing of the Engineer towards the contract signed between Contractor and Employer?
    2.- How the contractor should react to expected Engineer’s instruction upon re-entry to project?
    3.- What legal actions could the contractor take against the Employer?

    Thank you in advance.
    Best Regards.

    1. Dear Gregory
      My opinion is the follows:
      1- The Employer is responsible of the Engineer’s failure to comply with his duties under the contract. So, you can build your claim against the Employer accordingly addressing all damages incurred due to the absence of the Engineer.
      2- The Contractor should not object on the return of the Engineer to resume his duties during DLP.
      3- It is premature to address legal actions. Contractually, you are entitled for interest and other remedies provided you served the notiifcation to suspend, slow down or even terminate your employment as per the contract

  40. Dear Sir,
    please be so kind and explain me in TOTAL what NON adjustable index in Price escalation formula means.
    I know it is a fiked part -but I need verry good and comprehensive explanation.

    I thank you in advance and have a nice day,
    Nikolina

    1. Dear Nikolina

      I refer you toclause 13.8 of FIDIC 1999 which gives full explanation as follows:

      In this Sub-Clause. ··table of adjustment data” means the completed table of adjustment data included in the Appendix to Tender. If there is no such table of adjustment data. this Sub-Clause shall not apply.

      If this Sub-Clause applies. the amounts payable to the Contractor shall be adjusted for rises or falls in the cost of labour. Goods and other Inputs to the Works. by the addition or deduction of the amounts determined by the formulae prescribed in this Sub-Clause.

      To the extent that full compensation for any rise or fall in Costs IS not covered by the provisions of this or other Clauses. the Accepted Contract Amount shall be deemed to
      have included amounts to cover the contingency of other rises and falls in costs.

      The adjustment to be applied to the amount otherwise payable to the Contractor. as valued in accordance with the appropriate Schedule and certified in Payment Certificates.
      shall be determined from formulae for each of the currencies in which the Contract Price is payable. No adjustment is to be applied to work valued on the basis of Cost or current prices. The formulae shall be of the following general type:

      where:

      Pn = a + b Ln/Lo + C En/Eo + d Mn/Mo + ….. .

      “Pn” IS the adjustment multiplier to be applied to the estimated contract value in the relevant currency of the work carried out in period “n”. this period being a month unless otherwise stated in the Appendix to Tender:
      “a” is a fixed coefficient, stated in the relevant table of adjustment data representing the non-adjustable portion in contractual payments:
      “b”. “COO, “d”, … are coefficients representing the estimated proportion of each cost element related to the execution of the Works, as stated in the relevant table of adjustment data: such tabulated cost elements may be indicative of resources such as labour. equipment and materials:
      “Ln”. “En”. “Mn” …. are the current cost indices or reference prices for period
      “n”. expressed in the relevant currency of payment. each of which is applicable to the relevant tabulated cost element on the date 49 days prior to the last day of the period (to which the particular Payment Certificate relates): and
      “Lo”. “Eo”. “Mo”, … are the base cost indices or reference prices. expressed in the relevant currency of payment, each of which is applicable to the relevant tabulated cost element on the Base Date.
      The cost indices or reference prices stated in the table of adjustment data shall be used. If their source is in doubt, it shall be determined by the Engineer. For this purpose. reference shall be made to the values of the indices at stated dates (quoted
      in the fourth and fifth columns respectively of the table) for the purposes of clarification of the source: although these dates (and thus these values) may not correspond to the base cost indices.
      In cases where the “currency of index” (stated in the table) is not the relevant currency of payment. each index shall be converted into the relevant currency of payment at the selling rate, established by the central bank of the Country. of this relevant
      currency on the above date for which the index is required to be applicable.
      Until such time as each current cost index is available, the Engineer shall determine a provisional index for the issue of Interim Payment Certificates. When a current cost index is available. the adjustment shall be recalculated accordingly.
      If the Contractor fails to complete the Works within the Time for Completion.
      adjustment of prices thereafter shall be made using either (I) each Index or price applicable on the date 49 days prior to the expiry of the Time for Completion of the Works. or (ii) the current index or price: whichever is more favourable to the Employer.
      The weightings (coefficients) for each of the factors of cost stated in the table(s) of adjustment data shall only be adjusted if they have been rendered unreasonable. unbalanced or inapplicable. as a result of Variations.

  41. Dear Mr. Samer,
    I have another question for which i seek your opinion. This is concerning clause 42.2 and clause 53 from FIDIC 1987 General Conditions of contract.
    Can a contractor submit a prolongation claim for already approved extension of time as a result of “failure to give possession” under cl.42.2 directly without reference to cl. 53 (the contractor contents that if submission is made under cl. 42.2 without reference cl. 53, the 28 days notification becomes irrelevant). I will be obliged for your opinion on this matter.
    Regards,
    Liaqat Hayat

    1. Dear Liaqat

      Clause 53 was purposely drafted to put an obligation on the Contractor to serve a formal notice for claiming any additional payment under the contract. The clause says “Notwithstanding any other provision of the Contract, if the Contractor intends to claim any additional payment pursuant to any Clause of these Conditions or otherwise, he shall give notice of his intention to the Engineer, with a copy to the Employer, within 28 days after the event giving rise to the claim has first arisen.”

      This means that clause 42.2 is about your contractual entitlement but clause 53 is about the contractual compliance. Both of them are core aspects of any successful claim.

      I hope the answer satisfies your query.

  42. Dear Mr. Sameer
    Should contractor can claim extension of time incase of delay in progress payments

    1. the Contractor will be entitled for the interest as he is expected to get finance form banks to keep site going. The Contractor can slow down, suspend or terminate the contract if the Employer fails to redress the delays.

  43. Dear Mr. Samer
    our contracr says contractor should submit Insurance Policy( CAR)with first interim payment certificate . we didnot submit policy with certificate. Client revert the payment which affected our progress of work due non payment to suppliers and employees. are we entitle for EOT

    1. You will not be entitled for EOT. The general rule of thumb says that the party is not obliged to perform its duties under the contract if the other party to the contract doesn’t fulfill his duties.

  44. Hi, I am resident construction manager, i need to send a Contractor a notification of delay of works or slow progress, is there any sample letter?
    We are using Fidic 1999 Red Book

    1. Dear Sultan

      You can use this format which is designed for FIDIC 1987 and adjust the clauses as appropriate:

      To
      The Contractor
      Dear Sir
      Rate of Progress
      Reference is made to Site Meeting Minutes No ……….. Which sets out in detail current progress of the
      works.
      Having considered these I give you notice that for reasons, which do not entitle you to an extension of
      time, the rate of progress of the works (or any Section) is in my opinion too slow to comply with the
      time for completion.
      You are therefore required to take such steps as are necessary, subject to my consent to expedite
      progress so as to comply with the time for completion.
      This notice is given as required by Clause 46.1 of the conditions and it should be noted that you shall
      not be entitled to any additional payment for taking such steps.
      Yours faithfully
      ……………………………………
      Engineer

  45. Happy new year Samer,

    Would like to ask you of the consequences if the Employer is unable to issue notice to commence in accordance with the time specified n the Contract.

    Also what are the Contractor’s entitlemnt in this case

    Noting that time to issue notice to commence is not identified

  46. We signed the Structural Contract with client for built up area of 123,000m² .Client inserted the following which we did not notice while signing the contract.
    Pipes embedded in concrete and or back filling to be included.We have Backfilling above raft foundation and below Grade slab in which we have significant cost of huge network of drainage pipes. Are we eligible for cost of network. please elaborate in light of FIDIC Contract

  47. Hello,

    Can you please advice on the delay damages maximum amount / limitation percentage that can be applied under the UAE law? FIDIC clause 8.7 states that its value shall not exceed the maximum amount (if any) stated in the appendix to tender. UAE Civil code article 882 states that any agreement the purport of which is to exempt the contractor or the architect from liability or limit such liability, shall be void.

    what i understood earlier from lawyers I’ve met that damages can’t exceed 10% of the contract value even if this is not stated in the contracts, but the above references states otherwise.

    Regards.

    1. Dear Osama

      There is no limitation regarding the liquidated damages under the local law unless there is an express provision in the contract. Having said that, please refer to article no 390 in the UAE civil code which gives the judge the discretion to increase or decrease the amount of LDs.

  48. Dear Samer,
    1- Could you tell me if Scl 52.3 of the Fidic 92 (variation exceeding 15%), is also applicable to Subcontractors if Contract is on back to back basis.

    2- If applicable, do we relate to the subcontractor’s price in this regard. Even if the case was applicable to the Main Contractor under teh Main Contract or not.

    Thanks and regards

    1. 1- The subcontract should have a clear provision dealing with the adjustment of overheads should the subcontract variations exceeds 15%. The main contractor may have many other variations which are related to his own scope and other subcontractors.
      I am afraid you misunderstand the use of clause 52.3. Please refer to previous relevant questions in this page for more clarity.

  49. Good Morning!!!
    Can you please advise me on the negative variation clause for a lumpsum contract as per Fidic. is it applicable???
    Please advice me AEAP.
    Thanks & Regards,

    1. Omission or negative variation is allowed in lump sump contracts provided that the omitted work is not to be done by the Employer or his agents.

  50. Dear Samer

    I need your interpretation to the meaning of the “Aggregate effect of all variations” in clause 52 (3a) of the STANDARD DOCUMENTS for BUILDING and CIVIL ENGINEERING WORKS Third Edition July 1981 – SULTANATE OF OMAN. In other words what would the aggregate effect of 100,000 in omissions and 100,000 in additions be? Is the answer Zero or 200,000.
    Kind Regards

  51. Dear Samer,
    I shall be obliged for your opinion on clause 53.5 application as per details below.
    Can the sub-clause 53.5 be applied to a situation, independent of sub-clauses 53.1 to 53.3 provisions with 53.4 having been deleted in PCC. This is with reference to an amount which the contractor feels entitled to under clause 60.1(e) but have not kept record of notices etc.? To me,sub.clause 53.5 appears to also assist the contractor in retrieving the situation arisen due to having no record of notices etc under this clause.
    What do you think for reference of contemporary record as mentioned in cl. 53.2 /53.3.and then same being asked again under cl.53.5 ? This shows two different scenarios for application/occasions. I am not clear why the ‘drafter’ of the document wanted to have the record to be produced again under cl.53.5 if it was the same claim being referred in clause 53.1 to 53.4 and that is why i feel that 53.5 is not for the same amount as referred to in cl. 53.1 to 53.4. Hence clause 53.5 can be invoked independent of other sub-clauses.
    Regards,
    Liaqat Hayat

    1. Dear Liaqat

      I am happy to receive your interesting questions from time to time.

      Clause 53.5 is part of the master clause 53 on claims. It just gives the Contractor the entitlement to get paid against any claim raised following the procedures established in clauses 53.1 to 53.4. It also gives the Engineer the right to only give determination against those parts of the claim where sufficient substantiations were submitted by the Contractor. The Contractor is not obliged to include the particulars of each claim within each payment and it is enough to refer to his submission in the payment application for easy reference.

      I think removing clauses 53.1 to 53.4 will create a lot of confusions and conflicts on claims procedures.

  52. Greetings Samer,

    We are executing a project under FIDIC Design-Build and Turnkey contract (Orange Book) first edition 1995. The contract is on lump sum basis. The Emp. Rep. is requesting omissions from the contractor’s scope of work.
    My question is that does the Emp. Rep. have the right to omit works under orange book general conditions of contract. If yes what will prevent him to omit major part of works and what will become to the contract price which is considered fixed under lump sum FIDIC contract?
    Can you clarify?

    1. Dear Gregory

      The Employer Rep has the right to issue instructions for alteration or modifications which include omission regardless of the type of contract. To better understand that omission can be part of alteration scope, refer to clause 8.10 about prolonged suspension. I quote it here for your easy reference:

      Prolonged Suspension 8.10
      If suspension under Sub-Clause 8.7 has continued for more than 84 days, and the suspension is not due to a cause attributable to the Contractor, the Contractor may by notice to the Employer’s Representative require permission to proceed within 28 days. If pennission is not granted within that time, the Contractor may treat the suspension as an omission under Clause 14 of the affected part of the Works. If such suspension affects the whole of the Works, the Contractor may tenninate his employment, under Sub-Clause 16.2.

  53. The question is about DLP period.
    what are responsibilities of the Contractor during DLP period apart from doing the corrective works for the defects.Should he need to appoint a full time staff on site during this period . for example if water leak occurs who will close the valve until the maintenance team attend/rectify.
    Does maintenance will also fall under the DLP.

    1. Dear Cicin

      The Contractor has an obligation to complete the outstanding snags and rectify any observed defect. He is not obliged to carry out the maintenance work. The employer should appoint a team for the same once the project is taken over.

  54. In one of the contracts we have an agreed sum (say $10,000/day) for delay costs. Due to a variation we got EOT (say 15 days). Contract condition says variation cost shall include time related costs. In this case can I price the variation at direct cost pluse 15 x $10,000?

    1. Dear mohammad

      I assume the variation clause in your contract means that the assessment of the variation shall consider any prolongation cost due to EOT. In this case, you can make the assessment as you suggested.

  55. Mujeeb Rahman Poolan Chalil

    Dear Mr. Samer,

    In our cost reimbursement project in Dubai, we hired a boom loader and it has worked at site 2 shifts (6 Hours in each shift)in last year Ramadan. The supplier invoiced AED 15,600/- (by considering AED 50/Hour, 6 Hour X 2 Shift x 26 days). But the Engineer is ready to pay only AED 13,000/- according to the monthly rate (AED 50/Hour x 10 Hours x 26 Days) mentioned in the LPO. Which was prepared for normal days without considering Ramadan timings.
    How much we can get approval from Engineer and how much we need to pay to supplier?

    1. Dear Mujeeb

      I am not sure of the contract form you are using. Anyway, the cost reimbursement type gives you the entitlement for the actual cost incurred unless the extra cost is incurred due to abortive works or poor supervision/management.

  56. Hi,
    COC – Fidic 1987 4th Edition, Reprinted 1992 with amendments

    We have been awarded an extension of time without cost for inclement weather and now we are incurring delays due to late decisions from the Architect but we will finish during the extended period already awarded.

    My question is that can we put forward a claim to recover the cost incurred during that period due to late decisions from the Architect.

    1. There is nothing stated in FIDIC preventing you to claim extra cost for the adverse weather condition. Raise a cost claim pursuant to clause 53.1.

  57. Dear Mr.Samer,

    Thanks for your Valuable reply, now i would like to hear your clarification about clause 54.8- ” APPROVAL OF MATERIAL NOT IMPLIED” As the Sub Contractor is Claiming the Material Installed and Approved by the consultant deemed as final approval even its not meeting project specification .
    My question is the subcontractor Stand is Valid, i have argued that un-till the DLP period any Defect in the material or not meeting the specification,consultant / client have right to ask the contractor to replace the material without any claim/compensation in time & cost

    Kindly Request your expertise advise in this Regards
    regards
    Balamurugan

    1. Dear Balamurugan

      If the issue is about defective works that have been found out, the Contractor is obliged to repair till the DLP is expired regardless of any previous approval given in this regard.

  58. How do you tighthen the consultancy service agreement to ensure consultant’s liability and responsibility for the cause of project delay?

    1. Dear David

      Follow FIDIC white Book which is reasonably allocating such risk. You may seek legal advice as well since most of PI insurance claims are processed before courts.

  59. Ephraim Abdissa

    Dear Sirs,
    I am working on a road project. Partial provisional acceptance is carried out and the project duration time is elapsed.Now I am to extend the expired performance bond.My question is do I need to extend the performance bond for the whole project or only for the portion not completed?
    Thank You

    1. Dear Ephraim

      Under general forms of contract such as FIDIC, the performance bond should is a lump sum figure (i.e. 10% of the contract price) and is valid till the end of the Defect liability period with the same amount and no reduction is allowed following any partial completion.

  60. Hi

    I am working as site QS on a fixed price lumpsum contract based on FIDIC 1999. I have a variation for which the BOQ has a lumpsum figure of 100,000 (Tender breakdown not available). Now the regulations have changed & the works have changed entirely. The Original supplier quote as per tender requirements was for AED 25,000 which was excluding Electric, BMS scope related to the works.
    Now the revised quoted as per new requirements + profit is only 75,000.Now my PM wants me to claim a variation of AED 75,000 – 25000 ie AED 50,000.PM says since the contract is lumpsum we should get whatever is in the lumpsum. + any difference in the new & old quotes for the variations works.

    On the contrary what i understand is that I will omit what is in the BOQ and add the new cost + markup which will lead to a savings of 25,000 for the client.

    Pls advise what is contractually correct?

    1. Dear Niyas

      If the BOQ item is still relevant and can be used as a basis for the evaluation of the new scope, then follow your PM recommendation which is contractually correct.

  61. Dear Samir,
    we are working as a specialist subcontractor for carrying out MEP Towers on a contract which is tailored made from FIDIC 1987 with some changes and alterations such as Engineers & Engineers responsibilities are assigned to the PM.

    The contract has already elapsed the completion period and there is no EOT issued officially, despite we submitting and notifying on timely manner to the MAIN CONTRACTOR. We have submitted a prolongation cost for the extended period up to aug 2013 from dec 2012 with a detailed cause & effect study as per retrospective delay analysis technique.

    As per the contract terms the Main Contractor has to provide power for testing and commissioning activities.The T&C activities are on hold due to lack of permanent power, temporary testing activities are in progress with help of temporary power, the MC is reluctant to certify the valuations and variations on time, an instead we received a back charge stating that the Project Manager is not present on site for the extended period?

    As per FIDIC what is your evaluation and solution for the same ?

    1. You need to examine the claim clause your subcontract agreement which is usually compatible with FIDIC 1987. In parallel, make sure that the Contractor maintains his rights against the Employer by serving notices and particulars for your claim as per main contract. You may escalate the situation further by serving a notice to commence Arbitration should the MC continues his reluctance to act as per the contract.

  62. André van Schalkwyk

    Dear Mr Samer,

    We have a situation as follows:
    The contract is in essence FIDIC 99, and is lump sum with BOQ.
    There were certain port tender clarifications/changes made to the ceilings by the Consultant/Client to the BOQ specifications of certain items and incorporated in the final signed contract. These changes were not followed through on the drawings and contract specifications. These changes constituted a lower spec than the original with appropriate reduced price per item and saving to the Client. It is deemed that these changes overrule the normal precedence of documents but in these particular instances only, and the revised BOQ specs will take precedence.
    Considerable time has passed due to stoppages from the crash, but now suddenly the Consultant insist that normal precedence of documents apply and the Post tender clarifications in the BOQ are now invalid. We are contesting the matter as this will incur over 1 million Dirhams loss to our company, and are at the point of declaring a dispute and employing legal counsel.
    We believe that we are correct, but seek your advice whether we are overlooking. There are several other similar changes in the BOQ implemented at tender stage and if the Consultant manages to enforce his view, the loss could quadruple.
    Hope you can advise,
    Thanks, André

    1. Post tender clarifications supersede specs and drawings wherever discrepancies occur and this is the merit of clause 1.5. Should the Engineer insists on his position, you can serve a claim notice and follow the procedures as per clause 20. I don’t think you will need a counsel to do this.

  63. you feel strong about a particular activity to be a variation to the original contract. employer says this is deemed to be part of the original scope of work.please responce, why you think it should be a variation? secondly, how would you record your position, assume clauses to record your position. will you include this sum in your progress application?

    1. Rejected variations are considered Claims and dealt with by FIDIC in a very clear manner. Please refer to clause 53 of FIDIC 4th edition (1987) or clause 20 of FIDIC 1999.

  64. Dear sir
    i have a small problem with the client.
    i sent him for a lot of vo’s and the client always reply me with a proceed without accepting the price.
    what can i do .(in i refer to fidic)

    1. you need to follow the following procedure strictly:

      1- Get a clear instruction from the Engineer to vary the scope. Don’t take any instruction from the Employer directly. If happened, request a confirmation of verbal instruction form the Engineer.

      2- Submit the cost within 28 days from the receipt of the instruction.

      3- Include the Variation cost in your interim payment application as you are entitled to be paid provisional amount till an agreement is reached regarding the valuation of your VOs.

  65. crispina palo

    Dear Samer,

    Can you please differentiate in technical point of view Gross Floor Area (GFA) and Gross Internal Floor Area (GIFA)?

    Best Regards,
    Crispina

  66. My school district is undergoing a large modernizaion project which requires contractors to provide payment and performance bonds. Would it be sufficient to keep these bonds in a file drawer with the project file or is it necessary to keep them in a secure area such as a locked vault?

  67. syed muhammad abid

    Whether the compensation, can be paid as per clause 60.10 of the same period for which the extension of time has been granted as per FIDIC clause 44.1 ?.

    1. The question is not clear. If it is about the interest, it should be applied based on the additional duration that the Employer took to make the payment. It has nothing to do with EOT.

  68. Greetings, I am the Owner representative, and
    Our Contractor is behind Schedule,I asked our Engineer to request a Recovery Plan from the Contractor, he replied that, this is not Contractual and nothing in FIDIC 1999 leterally state such concept, (Recovery Plan), actually, we, as an owner consider this as non profissinal, please advise?

    1. Please refer to clause 8.3 which entitles the Engineer to request a ‘revised prgoramme’ whenever it is found that original programme is inconsistent with actual progress. This would be the same as you name it ‘recovery programme’.

  69. Hi Samer,

    I am working on a contract which is based on a heavily modified version of FIDIC Yellow Book. In particular, the Payments section 14 has been amended to provide for a cost reimbursment, pain/gain share model.
    The reimbusable content provides for payment of all “costs incurred in executing the works and remedying defects”.
    The Employer is arguing that this does not extend to costs of rework or fixing defects that occured due to our fault, both prior to or after the Taking Over Certificate. Clause 11 addressing fixing defects at the Contractor’s cost remains without amendment.
    There apprears to be few standard Cost Remimbursment forms to compare, although I note that the NEC3 Otion C does allow such cost of correcting defects prior to completion.
    I would appreciate your opinion.
    Many thanks.
    What is your opinion.

    1. Dear CeeJayEss

      I would concur with the Employer approach which is in line with FIDIC provisions. Cost plus can’t apply on re-works, else, the contractor will have no incentive in committing to project quality requirements.

  70. I have a question regarding clause 40 in FIDIC 4 regarding suspension of work as instructed by the Engineer. Due to change in design work had to be suspended for 6 months but both sides remained silent. The contrtactor is of the view that it is teh Engineer who has to access the extension of time as well as additional costs payable as compensation to the contractor and there is no notice or submission is to be made by him unless instructed. His view point is that it is not a claim and hence no notice is required nor any exchange of submission is required as all work is to be done for assesment of EOT and compensation by the Engineer after due consultation with the parties. My question is that do you agree with this thinking on the part of the contractor? Secondly the clause do not define any action to be taken by either party in this. Do you agree?
    Regards,
    Liaqat Hayat

    1. Dear Liaqat

      Suspension event is similar to any other event that could happen under clause 44 which will entitle the contractor for EOT.

      The Contractor’s argument is weak since clause 40.2 has specific requirements to be followed and expressly refers to clause 44 (including its sub-clauses and mainly 44.2), where the Contractor should have complied with the requirements of this sub clause 44.2 which states:

      Provided that the Engineer is not bound to make any determination unless the Contractor has
      (a) within 28 days after such event has first arisen notified the Engineer with a copy to the Employer, and
      (b) within 28 days, or such other reasonable time as may be agreed by the Engineer after such notification submitted to the Engineer detailed particulars of any extension of time to which he may consider himself entitled in order that such submission may be investigated at the time.

      I trust the above satisfy your question.

  71. i have a project in tanzania, the employer is Tanzania Road Agency . now the work has commenced for nearly four months. and no advanced paied as per the contract. also the employer asked us to perform the work with the contractor’s own pocket which will be reinbursed by employer . but pursuant to the contract, the employer is supposed to finance the project. by the way, the contract is no following FIDIC or whatever conditions of contract. its signed by following their cooked conditions. here are some omissions do exist in the BOQ”
    1:material on site is not mentioned in the contract, does it payable in the IPCS?
    2:there is no conditions of contractor’s right to suspend. can the contractor suspend the work if the employer failed to issue the IPC?since there is no clause about that. what do exist is the clause of termination.
    please kindly reply. if any further information is required, please inform. thanks a lot~

    1. Dear Sinawho

      I advise you to get a legal advice form a local lawyer. I am sure you will find something in the governing law that gives you the power to suspend or stop performing till the other party fulfills its obligations.

  72. Dear MR.samer,
    Thanks for your valuable suggestion , I would like know clear information about clause 70.2 , fidic 1987 , the consultant are interpreting the condition about authority regulation to be followed irrespective of the design mistake in the tender and construction drawing issued to us
    Please I require your advise
    Regards
    Balamurugan

    1. Hello

      If the design error could have been reasonably foreseen by the experienced contractor during tender, then the consultant may have a valid argument. In general term, the party who made the error, should be liable for it and its consequences, unless the contract says something else.

  73. Is there any specific time limit in FIDIC to submit the Extended Performance security to client before the expiration of current gurantee.

    Employer can call the Gurantee without informing to the contractor?

    Employer can terminate the contract as per 15.2a) after encash the performance security??

    1. Dear Anil

      I answer in the same order

      Fidic is silent about the time limit. However, the Employer is entitled to liquidate the bond if the contractor delays unreasonably in renewal.

      Employer can call the guarantee any time if one of the events mentioned in clause 4.2 (a to d) occurs without informing the Contractor.

      Yes, he can if he is entitled to terminate.

  74. Hi Mr Sameer,
    I appreciate your great efforts in clarifying the valuable doubts and improving the knowledge in the contractual issues.
    Here is one query from my side
    I am handling an Irrigation project of Lump sum value of $ 1000 million in India. Since this requires huge time (more than 12 months) for detailed survey and investigation, we completely depended on the data, estimations of preliminary BOQ provided by the owner (Government of state of UP) while bidding.
    It is consisting of 5 Appendices as follows
    1) Main Canal $200 million
    2) Tunnels $200 million
    3) Aqueducts $200 million
    4) Cross drainage works $200 million
    5) Total Distributory channels $200 million
    The duration of the project is 4years 2008 to 2012 but due to delay in land acquisition and court stay on the project for 9months, we have been awarded EOT for 9 more months. One typical point is that all the five Appendixes cost includes detailed investigation design. Out of five heads, four heads are in various stages with +_ 10% variation of quantities to the initial estimation. But, now after detailed investigation, the quantities of Appendix 5 are abnormally varying (200%) there by it would cost us $400million against payment schedule $200M. Where as in our contract, the BOQ are only tentative and for the purpose of interim payment only. In this scenario can you please guide us how to sort out this huge loss to our company?

    1. Dear Prakash

      This is a lump sum contract and the Contractor was aware of the risks involved with tentative quantities in the bill, so I assume he has considered certain margin for such risk.

  75. Dear Samer,
    Appreciate your response however you refer to agreeing time. My query (apologies if I was not clear) is if the final completion date is still under discussion/debate after taking over, does time then mitigate potential LD’s. Mr. Justice Coleman (Balfour Beatty vs Chestermont 1993)adjudicated/ruled that time may be added to the completion date for a VO (i.e. the net effect of an event). However this ruling was for VO’s before practical completion. Where is time given to additional works during the DLP period? Is it added to the Contract completion date or adjudicated as construction time during the DLP.
    Neither appear to make sense as the time for completion is for the whole of the works (including very late additional works requests)?
    What a conundrum?
    Do you have a further opinion?

    1. Dear johns

      In principle, any work which will be done after TOC date shall be mutually agreed in terms of time and cost to avoid disputes in future. The contractor is not bound to carry out such works after the TOC date.

  76. Does anyone have an opinion on the following?
    FIDIC ’87 4th Edition is silent about issueing VO’s/Instructions for additional works after practical completion/TOC have been issued.
    FIDIC ’99 expressly does not allow this.
    Whichever contract is used this situation often occurs. There is plenty of experts opinions on valueing these additional works however if an EOT has yet to be granted and the Practical Completion Cert is later than the Contract Completion date how is time assessed for additional works instructed after the Taking Over Certificate is issued?
    I can find not experts opinion on this issue!

    1. The answer depends on the nature of such variation works and how will the baseline completion date be affected when you impact the variation activity on the baseline programme.

      If you are entitled to EOT due to the variation during construction, then revised date for completion shall be calculated considering the new and old EOT claims.

      On the other hand, if TOC was issued, then you got an instruction to proceed with variation works, you need to agree the cost and time of this variation considering actual costs, site overheads and reasonable markup where the BOQ is not applicable any more.

  77. Dear Sir,

    The Engineer have denied multiple of times the consent on the nomination dates related to the nominated subcontractors in the baseline schedule stating it is not logically sequenced. On the other hand the Engineer had provided his consent only on the construction activities leaving the nomination milestones as provided by the Contractor un-consented. This have been going for 5 months now. Multiple meetings have been performed in that regard and many extra clarifications documents have been prepared and provided to the Engineer at his request. One of which is an excel file shoeing the links between the nominations and the construction activities in an effort to prove their correctness. We are using Fidic 1987 reprinted edition 1992. One issue to take into consideration is that the Employer is late with his nominations and notifications for extension of time have already been filed. It looks like the Engineer is not providing his consent in an effort to escape the late nominations. Please let me know your point of view for the above.

    Regards
    GB

    1. The Engineer can’t unreasonably hold the consent on the entire programme. However, if the backward calculations of nomination activities are not in line with the common practice, then the Engineer has a point.

      To resolve this issue, you have two options:
      1- Request the Engineer to provide what he considers reasonable in terms of backward calculations from the start date of relevant activity then discuss to agree.

      2-Don’t accept any nomination that doesn’t comply with the base line dates in terms of commencement of work on site. Make sure that you discuss with the proposed nominated subcontractor how he will achieve the programme. If he can’t, then reject nomination on this ground, else, the Employer should relieve you from the liability of delays incurred in such work.

  78. We are using the 99 Red Book and have amended Sub Clause 4 and 13 to include some flow down requirements to the subcontractors contracts. Is there a vehicle to require the review of contracts prior to the contractor issuing them to subcontractors?

    1. It is unwise for Employers/Engineers to interfere in domestic subcontract at all. However, it is recommended to amend the relevant clauses in the main contract when it comes to nominated subcontractors only.

  79. Dear Sir,

    I am working on the project witrh the Contract is governed by FIDIC yellow book.The Engineer denied to issue TOC with the excuse that the works failed at performance test.There was some problem in Power and gas due to the autorities which were Employer’s responsibility.While as he gave some baseless allegations to prove his point and asket for new Perf. test.So we did the per. test again.The Employer/Engineer wants us to install stablizer and also a gas tank in order to stablise the conditions.Now the Engineer is telling Employer that he cannot issue the Varitaion after TOC is issued and wants to prolong it for next 3 months instead of issuing it after 28 days as per FIDIC guidlines.But we are insisting to issue TOC based on our previous notice for TOC which we consider is still valid and Addendum to be signed that the TOC will be issued after 3 months with the back date.However this addendum is based on the fact that Engineer wants to facilitate for the stablizer for transformer in order to stablize electricity from grid.

    Please advise what will be the risks/consequences to enter into this addendum.

    Your prompt response will be highly appreciated.

    1. I hope I understood the technical part of the issue correctly.

      If the test was successful and signifies that the project is fit for purpose so end user can kick in, so there s no point of dragging the TOC further even if it will be issued with back date.

      to resolve this conflict amicably, you may enter into an addendum to retain the property for another three months but make sure that all resulting prolongation costs associated with retaining the property will be borne by the Employer. You also need to confirm that any future failure whatsoever in any system shall not lead to another delay in issuing the TOC.

  80. Dear Sir, under the FIDIC contract, for metro rail construction during the process of site inspection and design stage, it has been found a building on the way of the metro contruction is not stable and the contractor needs to stabilise the building. this would entailextra expenses, is the constructor able to make a claim from the client. There is the option of demolition, however the client is not willing to allow for demolition and the GC has sought the building to be maintained and this has led to extra expenses tro the contractor, can the contractor make a claim of these expenses.

    1. Dear Sawy,

      I assume you have a remeasured contract and you use CESMM3 as a standard tool of measurement of such civil construction. Accordingly, you may have a strong case to present to the Engineer provided you can demonstrate that such obstruction was not foreseeable when you tendered for the project.

  81. Dear Mr.Samer,

    We have a remeasured contract based on a minor works Contract. Cotnractor has not renewed his Insurances during the EOT period wherein the delay was due the Contractor’s failure. Can we consider this as breach of contract and what will be the remedy.

    Regards

    Ram

    1. Such breach is not deemed to be a material breach and many standard forms of contract provide provisions regarding the Contractor’s failure to put insurance in place.The Contractor shall be liable for all costs resulting from any damage to the Works and third parties that could have been covered by a proper insurance.

  82. Dear Sir,

    I Need one clarification in regards to the Project Specified supplier and Makes , In one of our completed projcet ,the Extract fan Make was mentioned Greenheck, Nueair, Twin city and in the Specfiaction as custom Made Design to Strobic air and the MEP subcontactor proposed the Greenheck make which is not complying to Project spec later on stage we ( Main contractor) understand that only the strobic air make can match the spec other supplier mentioned in the contact not able to match the spec,

    Now i need to clarify that is the subcontractor is entitiled for vartion , if yes on which clause in the Fidic 1987 4th Edition.

    1. If there is only one reference in the contract regarding the make of extract fans as you mentioned which is specifications, then the subcontractor is not entitled for any variation. Just check the subcontractor offer if he had qualified the make as mentioned in your quesiton “Greenheck, Nueair, Twin city “. In this case, he will have a case to claim.

  83. dear sir,

    can the contractor claim for lost profit as a result of omitting part of his scope of work under contract by the engineer.

    1. Dear Lisa
      The answer only depends on how the clause is drafted in the subcontract agreement and on the local law of the country where the contract is executed. for example, in the UAE, the clause Pay when Paid is valid under the UAE Civil Code but in other countres like England, the case will be different. I refer you to this link in CMGUIDE which is very informative:
      http://www.cmguide.org/archives/3266

  84. Hi! I am working for a project with an agreed duration of 26 months and payment is made through interim valuations. The project however got delayed due to the late payment by the client, lack of workmen at site, works behind schedule and late instructions. Each of the parties resulted to contest about the payment, contractual standing of contractor’s programme and principle guiding claim and dispute resolution. The project is now running into a great difficulty after the 10th month and so many issues arose resulting to pulling off workmen at site. In this case, how can we justify the governing laws to contracts including of course the payment cases? And what possible resolutions can be imposed in order to solve the situation? Please enlighten me to contractual issues and guidelines involved. Thanks in advance

    1. Dear Ram

      You need to check your contract how does it deal with payment delays. Many standard forms allow for slow down progress, suspension and termination. If the contract is silent about these issues, employ a lawyer to check your local law. Under many civil Law Jurisdictions, you would have a strong case to stop performing your obligations till the other party fulfills his obligations under the contract.

  85. Hi, currently I doing some research on Liquidated Damage

    In building contract, if the Employer doesn’t enter Liquidated Damages in the Appendix 1 , does it meant that the Employer waive his right to claim for Liquidated Damages?

    In later stage,can the Employer still impose Liquidation Damages on the Contractor?

    Hopefully I can get some advice.

    Thank you and Regards

    1. Dear Thomasho

      The Employer has the right to deduct LDS if there is a clause in the contract giving him such entitlement. As I understood from the question, the contract has the LD clause but is silent about the value. In this case, the Employer shall prove his actual damages due to the contractor’s delay such as loss of revenue and the like.

      LDs can only be applied if EOT claim has not been submitted or has been determined by the Engineer.

      1. Thank for the reply.

        It that mean that the Employer must claim the LD through litigation / Arbitration since the Employer need to prove the actual damages?

        Can the Employer add in the LD amount to the Appendix after the Contractor fail to complete the work within the Completion Date?

        Thank you

        1. It depends on the contract conditions. under many standard forms like FIDIC, the disputed deduction should be referred to DAB. If Notice of Dissatisfaction is served by either party, then Arbitration shall be the final and Binding decision on both parties.

  86. Hi

    I am working in a consultant company in Dubai , the employer has terminated the contractor, can the emplyer en-cash the security cheque submitted by the contractor against the performance bond?
    Also , can we appoint another contractor to complete the work .

    Thank you

    1. Dear Tamer

      You need to check first if the contract allows the Employer to terminate the contract for convenience or not. If not, court order is a must. The Employer can encash the security cheque if he believes that there is a certain default from the Contractor.

      Also, another contractor can be appointed if appropriate legal steps are taken to remove to terminate the first one.

  87. Dear Srinivas,

    I am afraid that I can’t help you here as I am not familiar with the Indian contract Act.

    However, in principle, all common and civil law jurisdictions call for good faith of parties. If you can prove that the client has misused the contract clause, then you may have a case.

  88. kathykhadijah_syed

    I am working in a consultancy. I want to ask, we missed something in our design drawings (height of level for compacted earth, profile not shown in archt’l plans), now the contractor wants to claim a variation. We want to protect our client by pointing out from FIDIC that it is the contractor’s responsibility to take full responsibility for the care of the works, also he didn’t raise this issue during Tender……is this justifiable? Thank you

    1. Hi

      It depends on the nature of the missing detail. If it is difficult for an experienced contractor to gudge the mising detail, then the Contractor is entitled for all relevent additional costs if any, specially if there are new items not mentioned nor priced anywhere in the contract.

      I agree that the contractor has an obligation to higlight any errors or discrepancies to the Engineer, but the Contractor can’t be penalized for consequences of design errors and relevant corrective measures.

  89. I am currently working on a project as a subontractor on a construction project based on FIDIC 1987 4th Edition. We had clearly stated in our proposal that providing sufficient, suitable and secure office space and storage facility would be the responsibility of the main contractor. The contractor’s LOA included our proposal as a part of the contract documents and also stated in his LOA that the list of contract documents do not have an heirarchy but are mutually explanatory. He has now provided us office facilities that are totally insufficient for our project team and is agreeing to only provide open space for storage instead of containers or sheds, as required by us. Can I calim under clause 42.2 failure to provide possession of site or should I stick to their acceptance of our terms in our proposal?

    1. there is no significant cause preventing you to possess the site. You need to remind the Contractor of his obligation under the contract and serve a notice that if he is not providing the necessary facilities, you will do it and keep your rights to claim agianst the same.

  90. Dear Mr.Samer,
    Thanks for your valuable advice & suggestions in the contracts administration , i have an issue in our ongoing project in dubai the contact is under1987 4th ed
    During the tender in 2009 the Nominated subcontractor raised a query about the smoke Extract system and consultant replied that the contractor has to propose during the shop drawing
    Accordingly the Nominated subcontractor obtained the shop drawing approval in the year of 2010
    During the course of project client has changed the floor plan and the consultant approached the DM for the layout approval and DM advised consultant to obtain the Civil defense approval prior to submission to DM
    During the Design Review by the Civil defense , the authority added some more fans and Ducting for the smoke extract system
    Now the question can we entiled for variation if yes kindly advise the clause to be refered

    1. Dear Balamurugan

      I understand that this is a lump um contract. You need to examine the wording in the contract documents regarding this issue. the quesiton is: Has the design liability of smoke extract system been transferred to the nominated contractor or not? If so, then no variaiton entitlement would be there.

  91. iby01@hotmail.co.uk

    Samer

    Thank you for your response. I wish to further discuss this further with an example from a live infrastructure project currently being executed in KSA.

    The contract as signed is a Lump Sum, Drawings, spec, geotech information etc was supplied to the Contractors during the bid period.

    The IFC drawings issued at commencemet are different to IFB drawings and are currently being remeasured. This remeasure is unfotunately causing some problems.

    As this is a infrastrcuture project, Certain dimensions on the drawings were approximate which the bidders were required to check before execution. Question 1, should the bidder have included a risk % for any variance between drawn qty & actual site quantity? or is his bid based on the drawn qty. Question 2, if the IFC drawing differs, can we adjust the risk % if the approximate Qty is changes)or is this seen as Client Risk.

    Thanks

    1. 1- Usually, the correct practice is to price any infrastructure project as remeasured contract. In your case regarding the LS contract, if any expereinced contractor is sure that some dimentions are approximate, then the risk is borne by the Contractor for any changes in such dimensions. You need to execute the contract as required to be fit to purpose.

      2- Regarding the IFC/IFB changes, Only difference in dimensions as shown in the drawings shall be used for calculating the variation without considering any risk factor which should be included in the BOQ rate.

  92. iby01@hotmail.co.uk

    Please advise how a true lump sum project works especially interms of the risks a contractor takes when bidding for the works and variations.

    1. The Contractor should study the scope carefully along with conducting a precise quantities take off to be able to price appropriately. Also, the general practice calls for adding a percentage for risks and contingencies over the total estimated tender price to cover any error in your esitmation.

  93. ephraim abdissa

    A road project is divided into two lots, lot1 and lot2. The completion time of lot1 is one after that of lot2.Thus the Employer cannot use the road of lot2 unless lot1 is completed.The Contractor of lot2 delayed the completion time and the Employer is to penalize him for liquidated damages.
    1. Is there any damages the Employer suffered on lot2 while he cannot use it before completion of lot1?
    2. Is the Contractor to pay liquidated damages just because he delayed the project though the road cannot be used?
    Thanks
    Ephraim Abdissa

    1. Dear Ephraim

      This is an interesting case. Contractully, if there is a prestimated amount of LDs in the contract, the Contractor is obliged to pay the LDs regardless of the actual damages caused to the Employer. However, in some countries such as the UAE, the Contractor can file a case in the court to waive or reduce the LDs and the gudge may look the fairness of your case based on article 390 of the civil code and there is high probaliblity for you to win the case.

  94. Dear Mr Samer,

    What is the difference between “Liquidated damages’ and “Penalty”

    Regards
    Iftikhar

    1. Liquidated damages are genuine prestimated amount for the likely costs that the Employer may incurr due to the project delays by the Contractor. some times, the Contract doesn’t include an amount and in this case, the Employer must prove all his damages resulting from the delay in project completion. In some civil code countries, the gudge may decide to increase or decrease the LD amount but he is not obliged to do so.

      Penalty is simply a punishment tool for specific default of the Contractor mainly delay and its amount can’t be increased or decreased by courts.

      You may read more about this by serching within CMGUIDE.

  95. Mr. Samer,

    Its been a very long time, hope you are fine and doing good, keep up your good works all the time…

    I do have a question on which i can bank upon your suggestion.

    FIDIC 1987-Re-Print 1992
    Hydel Project – Lump Sum Contract

    Midway of the project, lot of locals join as a group and threatened the survival of the people involved in the Job, We are a Main Contractor have promptly notified every day a contemporary records on such activists invloving in RIOT under Employer’s Risk and called upon the Employer to take necessary steps to stabilize the situation, but it got worst each and every single day, we continued to issue notices asking them to issue a notice to suspend the works… but the Employer seems to step out of his obligations, by simply relating this issues under coordination with authorities as instructing us to co-ordinate with police officials to set things right, which is deffinitely beyond the Contractor’s Control. The suspension exceeded 84 Days, still no developments, thereafter we issued a notice of Termination of Contract on account of prolonged suspension and demobilized couple of dumpers, shutters and cranes out of the site. But the Employer played very smart by not issuing a suspension order, albeit knew this one of his Risk’s, on the contrary he has wrote a letter to get back the demobilized resources, as the Contractor should not remove any such resources without prior intimation and approval.

    Now, as a Contractor, without having an impartial act from the Engineers and an unjust act of the Employer, site team is in great trouble of spending 6 million every month and non-progressive.

    Please advise me a solution from the Contract, where the mechanism is not availble in 1987 FIDIC to terminate the Contract, in absence of suspension order.

    To a certain extent we can relate this as an undefiable breach of Contract, but i need a solution stronger than this in line with the provisions available in the Contract.

    Trust my requirements are clear enough to comment on this, if not please let me know to clarify you better.

    Kind Regards,

    Srinivas

    1. Dear Srinivas

      I don’t understnad the problem. You said that “lot of locals join as a group” but I failed to understand they belong to whome and what they were doing?

      Please clarify.

      1. Dear Samer,

        Incovenience regretted,

        The actual problem is the locals join as activists to stop the Project from being executed as they think there would be a threat of ruining the lives of the habitants at the time of high tide.

        We are trying to link this activity under rebellion, as they are acting against the Government to stop the Project.

        Your valuable advise is appreciated.

        Kind regards,

        Srinivas

        1. Dear Srinivas

          I would agree with you to consider this incident as a rebellion since the spirit of classifying such Emplyers risks is to save the Contractor harmless from all events that are beyond his control.

  96. our contract is lump sum, some of the BOQ items had not been done at site can the contractor claim these items noting that these items are (PC rate)

    thankx

    1. Dear Rahal

      Since the contract type is based on a lump sum basis, the Contractor is entitled for recoevery of the contrac price whether some BOQ itesm have been carried out or not. The BOQ is considered as a schedule of rates for lump sum contracts. Just double check your preamble and instructions to tenderers if there is any clause to the contrary.

  97. our contract is lump sum, some BOQ item didnt excuted as its not required.
    can we include these items even its not done or we have to deleted.

    thanx in advance for your support and help

    1. Since this is a lump sum contract, the Contractor is only obliged to fulfill his obligations towards executing the contract scope as defined in the drawings and specifications. He will be entitled for the total contract price with no deduction.

  98. FIDIC 1999 and MDB versions stipulate in Clause 4.2 as follows;
    “The contractor shall obtain (at his cost)a Performance Security ”
    What is the meaning of “at his cost”?. Does it means contractor cannot claim cost of providing Performance Security?
    Please explain

    Regrads,
    Safer

    1. The cost of obtaining performance security from the bank is usually priced somewhere in the preliminaries. If no item is there in the bill, then it is deemed that the Contractor has included the cost somewhere else in the contract.

  99. Hello there,

    Sorry to come back agin on this subject “Claim under Lump Sum Contract”
    By definition the LS contract is based on known quantity (logical to build a price). What about change to quantity by contractor’s mistakes/error. The subject is critical since the mistake involve an increase in the material quantity by about 50%.
    The LS contract provides, as stated in my preveus message, the quantity variation is under contractor responsibility. Accordingly and due that big variation, is it possible to claim recovery of the extar cost?
    Thanks again.

    1. If the contract is signed on lump sum basis and no change to contract drawings has been made, then the Contractor is fully responsible for any increase in the BOQ quantities to perform the contracted scope.

  100. we are the supplier of subcontractor, for a huge on going project in Qatar, now all of sudden due to the dispute between main contractor and sub contractor the subcontractor abondoned the work and deminished from the country without clearing the payment of supplier or thier own labours. now how we can claim our out standing to the main contractor? or what is the role of main contractor or client to settle our payments?
    please reply.
    Regards
    Rego

    1. There is no contractual relationship between you and the main contractor/Employer, therefore, you can’t approach them. My advise to you is to seek recovery of your dues from the subcontractor by filing a court case against him.

  101. Dear Samer ,

    From an Employer perspective, in a Lump sum contract(Design-build) following Qatar general conditions ; kindly asking the follows:

    1-Is there any limited duration for a notice for a claim as per Qatar General Conditions, since no provision in our contract identifying the same! what to do to manage such case in our project which is running since 4 months,in order for us to get the contractor limited to a certain duration for the notice to any potential claim?
    2-What if an item we need to omit as it is mentioned in specs and not mentioned in drawings or in the BOQ ; What will be the rates or quantities to be omitted?(as the item is a wooden top for stairs wall parapet, as its clear in specs “where it is applicable”).

    Much appreciated your prompt reply.

    1. 1) I need to get further insight into your contract document to give a precise feedback. In general, the notice must be served within a reasonable time. you need to agree with the contractor on something but this will not be contractually binding unless an amendment to the Contract is mutually signed. Under Qatari Civil Law, failure to serve notice does not revoke the entitlement if no bad faith is behind such failure.

      2) Omit the item as a variation to the contract and measure the quantities net as if they would be executed. Market rate shall apply and you may request the cost consultant to get three quotations to fix a reasonable rate. You need to be careful here as the contractor may challenge your instruction to omit since the variation is not necessary to completion of work and no Value Engineering clause is included in your contract.

  102. The BOQ in the specific Contract I am referring to has been prepared as per CESMM3, as mentioned in Contract Data.
    In this Contract, a Warning Tape is to be laid above the pipeline as per Specifications and Drawings which are below the Contract Data, in the Priority List of the Contract Documents but there is no BOQ item.
    As per CESMM3, there should be BOQ items for all permanent items of work.
    Therefore in my opinion, Installation of Warning Tape is a Variation in the Contract and the Contractor should be paid separately since Warning Tape is a Permanent Item of Work in the Contract.
    Please C

    1. Warning tapes have no separate item in CESMM3 and it is deemed to be included of the piping rate. Check the preamble of your contract as it is usually stated there.

      I am surprised that CESMM3 rules doesn’t clarify this clearly under the relevant sections of pipeworks.

  103. Dear Sir,

    If possible please could you highlight where in CESMM3 are allowances for costs which are not proportional to the quantity of permanent work undertaken measured? I am assuming that this refers to the prelims section, most specfically the method related charges? I have limited experience of CESMM3, having worked on building projects using SMM7 for the last ten years.

    Regards

    Tom

    1. You are right.

      You may price the prealems as per the Tender BOQ-Preliminaries section and insert items for method related charges to cover the cost for specific items in the main bill.

  104. Hi Samer.

    Supplier’s Delay under FIDIC 99.

    A supplier failed supply cement on time that caused 4 days delay to the Contracto. The supplier failure is due to some problem with his manufacturing plant. Can the Contractor claim extension of Time and associated cost (standing time for plant and labour as well as time related cost. There is no provision in FIDIC 99 apart from Force Majeure that entitles the Contractor for Extension of Time. Am I right to say that a supplier is considered as a subcontractor that any delay caused by him is the Main Contractor’s rist? Is the problem of the manufacturing plant considered as excusable type of delay that warrants the contractor recourse to the Employer?

    Regards

    Pat

    1. All the circumstances that give the Contractor the entitlement for EOT are clearly stated in clause 8.4 & 8.5. This type of delay is deemed to be under the main contractor’s risk.

  105. Dear Sir,
    If the Notice of 14 days under clause 63.1 of FIDIC 1987 reprinted 1992 is served to contractor , then ;
    1- What is the next step and
    2- Can the notice be withdrawn , under what circumstances.

    Regards

    1. 1) The next step is stated in clause 63.1. The Employer may enter upon the Site and the Works and terminate the employment of the Contractor without thereby releasing the Contractor from any of his obligations or liabilities under the Contract, or affecting the rights and authorities conferred on the Employer or the Engineer by the Contract, and may himself complete the Works or may employ any other contractor to complete the Works. The

      2) The Employer may send another letter withdrawing the notice. This should be done before any act is taken on site as described above.

  106. Dear Sir,
    Once penalty for delay in completion is applied to the Contractor and paid by them, then wheather he has the right get back the guarantee amount? And one year maintenance period also he can avoid?

    1. All other obligations and liabilities of the Contractor under the contract shall not be affected by the payment of the penalty or LDs.

  107. Actually it is not under fidic,but I would like to know the fidic opinion in that regards,it is re-measured contract.
    Thanks and Regrads,

    1. Dear Ayman

      FIDIC 1999 Addresses this matter under clause 12.3 and lists all the conditions which may give the Contractor the entitlement to change the BOQ rate. You can download a copy of FIDIC 1999 from the download section.

  108. I concur with Srinivas answer, however, I don’t recommend following such adversarial approach till the Contractor has exerted his utmost efforts negotiating to prove his entitlement for loss of profit due to the client’s breach of contract.

    It is good to point here that in many cases, the client releases his instruction with poor background of his rights and obligations under the contract.

  109. I am the engineer’s representative for the project, when the actual quantity of the work varies more than or less than 25 % of BOQ quantity how the rate for the particular item can be calculated??

    1. There is no clause giving you the entitlement to vary the rate under such circumstances following FIDIC 1987.

      Under FIDIC 1999, please refer to clause 12.3 which explains the circumstances of varying the rate and I believe your case is covered.

  110. Dear Samer,

    Under fidic 1999, for a fixed priced lump sum contract, What if the Contractor put notation on all the BOQ items under Furnishing bill “Included in PS”..(Except for the mirrors which was priced)..

    Is the contractor entitled to provisional sum adjustment for all the Furnishings, including fixed Furnishings (which has details in the contract drawings) since it was noted in the BOQ that the contractor had priced these items under Provisional Sum.

    In addition, The notation on the bills might be the cause of misinterpretation on one of the Answers to Query, but then, the contract was finalised with all parties signed on those pages.

    I just want to make sure that it was not deemed to be included/priced in the contract amount and not to be adjusted like a Provisional sum.

    Thanks in Advance.

    1. (Mr. Samer please allow me to express my point of view)

      Dear James,

      Firstly, the Provisional Sum is an amount allocated by the Client at the time of NIT to have uniform quotations from all the participating Tenderers, therefore, while pricing the Tender the Tenderer is not supposed to include any other items under Provisional Sum which he feels necessary for his convenience. But to the Contrary the Tenderer has quoted said “Furnishing Items” as deemed to be included under Provsional Sums.

      Secondly, since the Contract is Fixed Price Lump-Sum the Tendered BOQ should have been scrutinized by the Client/PMC/CA and satisfied/ accepted by them that those “Furnishing Items” are to be dealt under any operable Provsional Sums (to be decided by the Client in Post-Contracts stage) as the Tenderer has merely quoted as “Included in PS” whithout mentioning to which PS item it shall be operated..

      Finally, Since, all parties accepted and signed the Contract, by principle, the said “Furnishing Items” priced as “Included in PS” should be dealt under some of the Provsional Sums available in the Contract regardless whether the details are available or not in the Contract drawings at the Time of Tender.

      Mr. Samer I request you to take further if you have different views to it.

      Kind regards,

      Srinivas

      1. Dear James and Srinivas

        Since the Contractor expressly mentioned in pricing the BOQ that he didn’t consider the furnishing items except for mirrors and the contract has been signed without altering or overruling this fact, the contract is deemed to exclude the furnishing items from the main Contractor’s scope except for mirrors.

        Again, we reiterate, the acts of all parties must be performed in good faith.

    1. Are you talking about tendering stage?

      I assume that BOQ should be prepared by the consutant and no alteration should be made to it unless there is a provision to do so like addition and omission adjustment.

      Please clarify.

  111. Dear Samer,

    Could you please explain what is THE LOCATION OF THE PROJECT SITE which is claimed in Preliminaries by Contractor

    Regards,

      1. Dear Samer,

        Thank you for answering,

        Basically the CONTRACT IS FIDIC, RE-MEASURE – CONSULTANT PREPARED BoQ MODIFIED BY CONTRACTOR AND SUBMITTED.

        Where Contractor Added item in PRELIMINARIES ” THE LOCATION OF THE PROJECT SITE” and Priced.

        and “COST OF SNAG WORKS”.

        Please clarify.

        1. Yes, the tenderer can price for items not mentioned in the BOQ unless the consultant objects to have any modification in the bill. In this case, the Contractorwill price all addtional items separately and distribute them somehow in his BOQ rates.

  112. Hello,

    I’m working for a Main Contractor and currently using FIDIC 1999 in the project.
    Can the Client omit part of the works from the Main Contractor’s Subcontractor and giving that part of the works to the client’s nominated subcontractor. This work is a Provisional Sum item and has been approved previously by the Engineer/Client.
    Does any clause in FIDIC 1999 mentioned about this situation whereby the Client is allowed to practice such thing? or is this a breach of contract from the Client by doing so?
    If it is a breach of contract, how do I claim for compensation from the Client because we presume our Subcontractor would claim their losses from the Main Contractor and this problem is not due to the Main Contractor but the Client.
    Please advise me which clause in FIDIC 1999 can I use to strengthen my claim for compensation.
    Thank you.

    1. Dear Jason

      I understood that your client wants to omit part of the scope of the main works under the main contractor’s scope and award it to another subcontractor nominated by him. Please confirm to give you a proper answer.

      1. Thank you for your reply.
        Yes, the client wants to omit part of the scope under the main contractor’s scope which has been confirmed before.
        Looking forward to your reply.

        1. No, he can’t do that. Refer to clause 13.1 (d) which gives the client the right to omit works provided it will not be given to others.

  113. I am a Contractor of road project. Can I reject accepting additional variation works out of the corridor of the road?

    1. You can reject variations if they are not necessary to complete the project or if the scope of such variation is not within your speciality of work.

      However, I suggest that you need to be very careful when rejecting the variations to avoid spoiling your long term relationship with the Client.

  114. Hi Samali,

    In my opine following needs to be checked:

    1. Is there any provision for EOT mechanism in your Contract as it is bespoke and non-standard form of Contract?
    2. Is there any provision for approval made as a constraint in your baseline programme?

    If point no: 1 is not there then it is an one sided agreement and fair determination would not be made available to you easily. On the other hand you always have right to make the client understand that it is a Joint development and acting in Good faith is the essence of any Contract.

    If you donot have provisions in the baseline, you can however, correlate the activities to be done at site which requires the information/ instruction/ approvals in executing those and request the client to expedite the process for future works.

    I request you to refer articles by Michele Nelson on To Accelerate or Not and by Chris Larkin on Constructive Acceleration demands clear intention and by Jeffry Badman on Extension of Time Claims filed in Contracts Administration as those clearly explains mitigation is obviously and always an obligation on the contractor but does not require Contractor incurring costs on Excusable delays.

    To simplify an answer to your question, you have right to claim EOT and additional costs/ compensations provided

    1. Proper notices are served in time on Employer’s default of not providing instructions/ approvals at appropriate time.
    2. Your intentions to claim additional costs resulting thereof is notified.
    3. You have actually incurred such costs due to the disruption caused by the Employer.

    I also request you to understand the importance of delay notices through article by Philip Adams – Delay Notices – a Declaration of war.

    Finally, i would also request you to go through the SCL protocol on delay analysis available under downloads section to validate your stand in front of your Employer.

    (Mr. Samer, due to your enormous work loads i took a stand to comment on this context – Errors if any on my views be excused please)

    Kind Regards,

    Srinivas

    1. Dear Srinivas
      Thanks a lot for your feedback here to Samali.I concur with your opinion here and I add that the client act should be in a good faith, otherwise he will be in default in light of most of the civil codes governing the contract whether standard or bespoke.

      If the contractor can prove this like unnecessary delays in approval and the like, he can file a case in court (provided no arbitration clause is provided in the contract) to get his rights including EOT and relevant compensation.

    2. Dear Srinivas and Samer,
      First of all I would like to thank you for your ansewrs and all the works (pain) you are taking to help people.

      As far as this case concerne, I would add some precisions, if that can assist a better comprehesion/advice.
      Yes indeed the contract provides for EOT as well as for Change Orders. The only problme to be noticed is that all actual issues are at charges of Contractor and the Employer’s, called disruptions are really non, since he is only exercising his contratcual rights.
      Actually, the Contractor is continuing to spend extra costs and further delay due to his own under-estimating the quantities of works and time needed to complete the project.
      The question is, can the Contractor / or has the Contractor a case through which he can claim get any compensation, while the Employer has no what ever responsibility in that? I am thinking about the famous “Ex-Gratia” claims since, Contractor, according to the contract acual conditions has no contractual grounds for justifying a claim (classically).
      Your prompt opinion would be, againe highly appreciated.

      1. Contractually and legally, there is no liability upon the Employer to reimburse the Contractor for damages caused due to any of the Contractor’s risks.

  115. Dear Mr. Samer,

    Appreciate your efforts in providing great guidance and support in this blog on Contracts Administration and mostly on FIDIC based contacts and thank you very much for the useful and valuable downloads made available to us.

    Good wishes for it and keep up your good work

    Could you please upload JCT forms of Contract. If possible could you make us available SBC/Q 2011 or 2005 Edition at your earliest convenience please.

    Kind Regards,

    Srinivas

  116. good day,

    the project suffering from big delay caused by the contractor due to shorte resources available at site.
    the client plan to charge the contractor with the cost of the consultant and project management for the period of delay.
    noting that the client will apply liquidated damageson the contractor.
    is the actions of the client are justified contractualy

    1. Dear Rahal

      LDs usually cover all such losses or damages incurred by the Employer unless there is a clause in your particular conditions stating something else.

  117. can the client and due to the excessive delay of the contractor in completing the project, terminate the contract and considered the contractor in default.
    noting that the lequidated damages reach the maximum, but the contractor still working in the project.

    1. Dear Rahal

      Yes, the contract can be terminated pursuant to clauses 46.1 and 63.1 of Fidic 1987 provided that all relevant notices are given as stated in the contract.

  118. In FIDIC 1987 4th 1992 form of contract – Part 11- if clause 70.2 totally deleted and 70.1 ammended as to the sense of that any kind of
    cost increase will not adjust the contract sum . In a scenario like this when a legislation change appears and the working hours reduced and labour salaries increases- how a contractor claim his actual incurred damage both in Time and cost,….. I mean in which basis/ground? . Deletion of Cl 70.2 is it correct/unfair in terms of contract either as an exclusion . what will be the notice time bar and the submission of the interim particulars as a continues effect . Does conditional precedent apply here?
    Look forward your professional review.
    Bandara.

    1. Dear Bandara

      Deleting clause 70.2 doesn’t necessarily mean that the Contractor will be deprived from his right to claim. The employer should have amended the sub-clause to clearly state the same if this was the intention.

      So, your contract is silent about the change in legislation, therefore, the dispute can only be resolved in courts if the Employer denies your entitlement as it is not stated in the contract but it might be stated somewhere in the civil or common law. However, you need to look at the law provisions governing the contract and find a clause in which you prove your entitlement.

  119. Good day,
    I have a question regarding a dispute involving how a quoted linear meter rate of a material and how when remeassured this rate should be applied.
    On a fixed and variable contract, a material was quoted at simply a m2 rate installed. The material arrived to the client in a rolled carpet form, and therefore was always the intention for client to pay total linear meters received.
    It was difficult to foresee total volumes required due to many factors that could influence the face volume of the area… poor ground conditions, poor batter blasting etc etc
    At project completion, an unexpected remeasurement indicates that the total linear meter of work area is only 2/3 of total material volume used to complete the job, thus 1/3 of highly priced material was deemed lost in laps, wastage and the like. Client stance is that this wastage should have been allowed in original quoted rate.
    If the contract is somewhat unambiguous in terms of wording and can be interpreted by both parties in different ways, how are such disputes usually settled? I’m unsure if in Civil Works the contractor is expected to incorporate such losses into original quoted meter rate or not.
    Furthermore, a Request to Order/ Approval to purchase the total volume of materials was received by the client (if this makes any difference).
    Look forward to your response. Kind Regards

    1. I hope I understand your question correctly.

      The client is right with regard to what the installation rate includes. In all standard methods of measurement such as POMI and SMM7, overlaps and wastage are not measured and must be considered in the rate only. The Contractor is fully liable for the loss incurred in the material.

  120. The contractual completion of the project is dec. 01 2008 but it was delayed by one year means the project was completed dec 01 2009. There was no TOC issued by the Client but the client occupied the project without issuing the TOC to contractor and the contractor was already received the final payment. The client wants to file a case in court against the contractor by claiming liquidated damages. My questions are:
    1. Can the client entitled for liquidated damages without issuing first the TOC?
    2. When will be the starting point of calculating LD’s, from the actual completion period to issuance of TOC?
    3. Can the client occupy the project without issuing the TOC’s contractor?
    4. There is an approved claim of contractor amounting to 1M during the construction period but the settlement of interim final payment was already received by contractor. Is there a remedy to claim the 1m even though final payment was already received by the contractor ?

    1. Dear Minerva

      I am not sure what contract form you are using, however, I will answer you in general.

      First of all, the Employer occupancy of the building implies that the building was substantially completed and the building hand over to client is considered the date of project completion.

      Now, let me answer your question in the same logical order:
      1- Yes, he can as the contract allows and based on the above interpretation of the case.
      2-Calcluation of LDs will start from the contractual completion date to the building taking over by the client unless there is an application of valid EOT claim by the Contractor.
      3-in the first place, the Contractor should have not handed over the building without the TOC in hand. Client should have issued the TOC and the Contractor must claim it even now for records.
      4- The Contractor can still claim any dues unless he has signed the discharge letter.

  121. hi,
    i am working on the Client side, our Contractor’s contract will end by Dec. 30, 2011 but the project most likely will not be completed on Dec 2011 due to Contractor’s default and after several meeting with the Contractor,they agreed and willing to accept/pay the Liquidated Damages as stated in appendix C which is 10% of project value(maximum). The question is since they are willing to pay the LD’s then are they allowed to extend the completion date what ever they like?i.e are they allowed to extend even 1 year more since they are willing to pay the LD’s?

    1. Dear Minerva

      If the contractor acts in a bad faith based on the fact that his losses will not exceed the maximum 10% LDs, the Employer must serve a notice to the Contractor about the rate of progress. Failing to do so by the Contractor, the Employer has the right to terminate the contract and assign another Contractor to do the rest of the work and deduct all expenses from the Contractor in default.

  122. When forced Majeure events happened in different days of the project due to bad climatic conditions how this can be included in the program to show the impact.

    Usually each event is inserted as one single activity. How about in this case.

    1. You need to insert this event as an activity with duration in the programme and run the programme to check the impact.

      Please refer to some articles in CMGUIDE about delay analysis methods which gives you more information.

  123. Our main contractor transferred the supply of materials to another subcontractor and what is left to us is the installation. What clause in fidic can we use in order to claim for overhead and profit due to transferred scope of work.? and if the cotactor descope the whole item and transfer the item to another subcontractor can we claim for the overhead and profit of the descope item?

    1. Dear Benj

      I understand you work as subcontractor. The answer depends on the conditions of contract you have with the main contractor and you need to read it carefully.

      In general, there will be a default from the main contractor to omit any scope from you in order to give to someone else. You will be entitled for loss of Overhead and profit and any other losses that you might be incurred due to this.

  124. I am engaged in a World bank funded highway project in India. Our works is substantially completed and Taking over Certificate is issued. FIDIC conditions of contract are adopted for our contract agreement. As per contract cl 60.5, a statement at completion is to be submitted by the contractor within 84 days after issuance of Taking over Certificate. Against that Statement at Completion an Interim Payment Certificate is to be issued in accordance with cl 60.2. Now the contractor wants payment against the work done upto the date of taking over of the works. I want to know whether the contractor can submit monthly payment statement under cl 60.1 after issuanace of Taking over Certificate without submitting the Statement at Completion under cl 60.5 and eligible for Interim Payment Certificate under Cl 60.2?

    1. Dear Sray

      The Contractor can submit an interim monthly application for two months after the TOC is issued. He should be entitled to receive payment against those application as certified by the Engineer. However, the Contractor must submit by the 84th day after the TOC the statement at completion where there will be no further interim payments submission.

  125. Dear Sir,

    Do the contractor have the right to suspend public services works under the Lebanese Law? forexample can mtc touch for a certain reason suspend its works?

  126. Dear Samer,

    In the UAE, when a Consultancy Agreement ( for Project Management services during Construction stage ) is Resource Based, how can the Employer / Client define the number of working hours and number of workdays per week ?

    Note :

    1. Our ( bespoke ) Service Agreement only has a monthly resource schedule spread across the contract duration. The contractual working hours / workdays has not been specified.

    2. The Labour Law ( on the Government website ) only says “MAXIMUM number of normal working hours for adult workers is 8 hours a day or 48 a week”. That’s not very helpful either.

    Many thanks again for this very informative website.

    1. Hi George,

      You only need to respect labour law with regard to 48 hours a week.

      If the contract is silent about the duty, then the common practice should be followed in good faith. I assume that the duty should be from 8am-5 from Saturday to Thursday.

  127. Dear Sir,

    I need your help in writing a clause that states that part of the Contract price is lump sum and the other part of it is remeasured.

    Thank you!

  128. Presently I am working for Re measured infrastructure project. In this we have some different type of utilities like storm water, potable water etc . The measurement is based on CESMM3 and FIDIC. My question is while taking Chamber depth what is depth criteria.
    I mean CESMM-3 clearly specifying that the measurement should be from Cover level to top of base slab or invert level of bottom pipe whichever is lower. But in project preamble is specifying for the depth chamber should be from cover level to invert level of chamber (Not invert level of pipe). But the consultant is saying invert level chamber means invert level of bottom pipe and not top of base slab. Please suggest me what is invert level chamber as per CESMM3. Your immediate response highly appreciated.

    1. I concur with your consultant on the approach as it really makes sense. It is not a correct terminology to use the expression of invert level to indicate the level of top slab. Invert level is mainly used for pipes.
      CESMM3 does not define what invert level of chamber is.

  129. Dear Sir,

    We got a letter from Main Contractor as per Clause 46.1 rate of progress is slow, but we have some material delivered to site and some are on store. Moreover the site is not ready to accept more material and our areas are not ready.
    Kindly advise how we can prepare counter letter based what clause of FIDIC 1999, UAE.

    1. You are working as a Contractor or Engineer?
      What FIDIC form you use? it seems you use 1987 as you refer to clause 46.1?

      Please give more detail so i can answer you appropriately.

  130. can the client apply liquidated damages on the contractor based on the handing over certificate, noting that the certificate was delayed deliberatly by the client while the work was completed earlier

    1. Dear Rahal

      Firstly, let me clarify something. The taking over certificate must expressly mentioned the date in which the work has been substantially completed. If not stated, the date of the letter will be the date of completion.

      If the Employer interferes in issuing the TOC, there will be a default of Employer which gives the Contractor the entitlement to terminate the contract. Anyway, all parties must perform the contract in good faith and you need to prove that the Employer behaved in a bad faith when going for arbitration/court.

      1. how the contractor will terminate the contract.did you mean that the the employer will be in default
        but the employer defult clause at fidic always based on the financial
        issues

        1. Refer to clause 69.1 which says:

          (a) failing to pay to the Contractor the amount due under any certificate of the Engineer within 28 days after the expiry of the time stated in Sub-Clause 60.10 within which payment is to be made, subject to any deduction that the Employer is entitled to make under the Contract,
          (b) interfering with or subtracting or refusing any required approval to the issue of any such certificate.
          (c) becoming bankrupt or, being a company, going into liquidation, other than for the purpose of a scheme of reconstruction or amalgamation, or
          (d) giving notice to the Contractor that for unforeseen economic reasons it is impossible for him to continue to meet his contractual obligations, the Contractor shall be entitled to terminate is employment under the Contract by giving notice to the Employer, with a copy to the Engineer. Such termination shall take effect 14 days after the giving of the notice.

  131. Dear Sir,

    I need your help on my question: Which Critical Path Method is highly recommended to be used in the EOT nowadays?

    Thank you in advance.

    1. Dear nairy,

      These is not white or black answer to your question, as it all depends on the nature of delay and relevant circumstances.

      There are different popular delay methodologies which have their pros and cons. Personally, I prefer the window analysis method which is more practical and fair for all parties.

      You can go further details about all methods from here:
      http://www.cmguide.org/archives/2606

  132. Mr. Samer,

    Sir, my question is :as per contract the defect liability period of the contructor is 1 year only,is the Defect Liability is with connection with the warranty / guarranttee certificate ( e.g. 5 years and more) of the equipment and manufactured structure? is it possible to transfer the warantee / guarrantee certificate in the name of the employer / owner of the project? Is the contructor still liable after the DLP of 1 year if the warrantte / guarranttee of the equipment is 5 years or more?

    I am waiting for your answer. Thank you.

    1. Dear Jaina

      The Main contractor will be responsible of all defects till one year from handing over. Also, he will be liable for the safety of the structure for 10 years.

      About the extended collateral warranties beyond the DLP,the correct approach is to assign all warranties in the name of the Employer which will act as direct contracts between the Employer and the suppliers/subcontractors. The main contractor will not be part of such contractual relationship after the DLP expiry.

  133. Mr Samer:
    I need your help on my question: “Is it possible to have an amicable solution to a case after the contract is terminated?”
    The case is contractor shall return some amount of money (over-payment, Advance Payment, Retention Money).
    Thank you for your consideration

    1. Dear Renegade

      Generally, if both parties reach to an amicable settlement after termination,then a settlement agreement should be formed including all agreed issues and signed by both parties. Accordingly, it will be contractually binding on both of them.

  134. Dear sir
    I am a contractor. The construction has been delayed partly because of the employer’s fault and partly contractor’s fault.
    Due to the delay, the handover and release of retention money were also delayed.
    The construciton is still going on.
    The employer makes a suggestion to release the retention money to solve the cash problem. It is a good thing. However as a contractor, can I have right to claim interest to the delayed release of retention money for the period of delay caused by the employer? Of course I have submitted every evidence proving that the delay was resulting from the emoloyer’s fault.
    I am waiting for your answer. Thank you.

    1. If the delay is nonconcurrent, you have the right not only to claim the interest of delayed release of retention, but also to all other likely costs that have been incurred by you as a result of the Employer’s delay.

      If there is concurrency in project delays, SCL Protocol advises that you need to successfully segregate the incurred cost associated with the Employer’s delay to be able to substantiate your claim.

  135. Dear Mr. Samer

    we have Lump Sum Contract (Fidic 1999) , Engineer wants to ommit some work item in BOQ , my question is how much should we deduct from the contract value considering both of the following 2 cases:-

    Case 1: Qty = 1000 m2 in BOQ but when we come to deduction the taking-off from the drawings showing QTY = 1200 m2

    Case 2 : Qty = 1000 m3 in BOQ but when applying POMI to calaculate oommited QTY to deduct Qty = 300 m3

    Thank you

    1. I didn’t understand on what basis take off measurements were taken in option 1.

      Anyway, if POMI is stated as a reference of measurement in your contract, any take off from drawings should respect its guidelines.

  136. Mohammed Taha

    Dear Mr. Samer
    In re-measure contract type for a renovation project(under fidic 1987/92 4th edition)
    One of the work item in BOQ is Design/Build item with L.S. amount, the owner recently asks to change proposed structural design(as in tender drawings) for a new addition part and he suggests to use anther expensive structural design system to gain more safety for an existing adjacent structure.

    Is there any chance for variation claim in such like case ?

    1. Yes of course. YOu have priced for the project based on certain information. If such information was changed by the Employer, then you are definitely entitled to claim the variation works.

  137. “dear sir, I am currently working on a road project as a contractor. The road is funded with payments being separated into a “local” portion (payable in local currency) and a “foreign” portion (payable in USD). The contract provides in the appendix to bid that interest on delayed payments to the contractor in respect of the foreign portion is based on the interest of 2% plus LIBOR that were quoted at tender which is 4.3865% previously.also as stated in the contract, in the event of failure of the employer to make payment within the times stated , the employer shall pay to the contractor interest compounded monthly at the rate stated in the apppendix to bid upon all sums unpaid from the date upon which the same should have been paid.
    herewith the interest calculation, the engineer take this 4.3865%as a annual interest, not the libor monthly interest. i can’t agree. cause i believe that there is no relationship between the libor annual and monthly interest

    I hope that this information will suffice, and that the question is appropriate. For Example ,the delayed payment is 1,000,00usd, the delayed period is 6 month , how to calculate the interest?Thanks”

    1. You need to calculate based on the annual rate. Just double check the LIBOR rate record at the time of tender to make sure you are using the annual not the monthly rate.

  138. I will give you an example.
    A cable is going from Building A to Building B.
    The cable trench shown in the Approved drawing is of length 240 meters. Due to the looping, we used a cable lenth of 270 meters.

    When we tried to claim for the 270m. Consultant is arguing that all the loopings and extra lenths are already considered while developing the Unit Rate for that item and refusing to accept for the 270m. He is telling Contractor can claim for only 240m of the length. Who is Correct?

    1. The rule says that all works should be measured net from drawings. However, I urge you to look at your standard method of measurement referred in the contract such as POMI together with the preamble guidelines to see if there is any room to support your claim.

  139. Dear Mr. Samer

    Sorry for not making a few issues clear. Here they are;

    1. The labour-only contract was withdrawn before tenders were invited. Hence we have no labour-only rates to compare with.
    2. The contractor indicated in one the e-mails to us during the negotiations that his price on concrete items was fair because he considered quality concrete rings with ‘proper reinforcement’. This indicated to us that his price was for an already-made concrete ring.

    In the prelude to the Bills of quantities, we have the following paragraph;

    ‘The brief descriptions of the items given in the BQ are purely for the purpose of identification and in no way
    modify or supersede the detailed descriptions given in the specifications. When pricing items, reference is to be
    made to the conditions of contract, the relevant national or international standards, the drawings and the
    specifications for the full directions and description of the tenderers obligations.’

    And in one of the Particular Specifications, we had the following clause;

    ‘The contractor shall at his own cost supply all machinery, plant, tools, labour, fuel, housing and
    everything required to carry out the work expeditiously and efficiently.’

    In view of the above further information, could you offer further comments please.

    Thank you.

    1. Since the scope in general was based on material and labour basis, then I think that the Contractor may have no entitlement. Your argument makes sense and you may develop it further by addressing the improper notice of claim.

  140. Dear Sirs,

    Is there a clear method of proceeding with Loss of profit claims due to extension of time?

    Please advise.

    Regards

    1. It depends on the form of contract you are using. In general, it is difficult to prove the loss of opportunity claim under standard contract provisions as there is no clear clause giving you such entitlement, however, you have an alternative to get reimbursed through litigation.

  141. We are preaparing a lump sum contract with the guideline of fidic
    yellow book.
    The employer wants to add a provisional sum for an item which is not clear at the moment.
    However at the design stage that could be designed and offered by the tenderer.
    The work is a high speed railway project. The employers wants the tenderer to design where, how many, and how long approch tunnels shall be necessary for railway tunnelThe tender shall design and construct the highspeed railway project with tunelles, viaducts wehatever necessary.
    The question is at the tendering stage without information about how many and how long approach tunnels shall be necessary how can we incorporate this into the schedule of rates for our lump sum contract. can we solve this with provisional sum and how

    1. Dear Funda

      In construction law, there are two types of provisional sums:defined and undefined.
      The defined provisional sum should cover sufficient scope details that help the tenderer price for relevant attendance and incorporate the relevant works in the programme. In this case, the tenderer will be fully liable for the programme and the attendance price.

      In your case, you have undefined PS. You should request clarifications to enable you bid for the work, otherwise, you must include an express provision in your offer that you will not be liable for the estimated program or attendance price and the same shall be assessed in a proper mechanism that should be agreed before signing the contract.

      1. Dear Skaik,

        Thank you for your response.
        But I want to give further deatils about my question, because I am not sure whether I explained it properly or not.
        The question is:
        We are a consulting company and we are prepairing the tendering documents and the required contract for a state railways authority ( the employer)
        The tendering will be lum-sum contract for the design, build and construction od high speed railway project.
        The employer will give some “employer’s requirements.
        The tenderer will give their price as a lump sum, but there will be some breakdowns for tunnels, viaducts, bridges, shafts, etc.
        At this stage we did not put any breakdown for the escape tunnels, because we do not know how the tenderes will desgn their project, how many and how long will be the escape tunnels.
        Also Employer is not sure whether they are going to give these escape tunnels to the succesful tenderer or give it to another company with another tender or not?
        But the Employer want to see the tenderers offer for these escape tunnels.
        It will not be included into the lump sum. It will not be a critea for the selection of the succesful tenderer, but they will design and offer a price if they are going to do that how they plan to do it.

        So my question is: at this tendering stage what can we write into the tendering documents and the draft contact, to support the benefits of the Employer, and give the flexibility to the employer afterwards to decide how to continue to have the escape tunnels.

        Kind Regards,

        Funda

        1. You can include a BOQ item with a proper description as you mentioned and request the tenderers to put rate only. This will help you get prices and you will not be bound to give such work to the successful tenderer.

          In case you want the tenderer to design the escape tunnels only, you need to mention this clearly in the BOQ as part of the main works and request the tenderer to price the relevant execution as rate only.

          In both cases, the Letter of Acceptance should address the intention of the Employer to avoid conflict later on.

  142. Dear Sirs,

    We were preparing a labour-only contract where there was phrase,’cast concrete rings using the materials provided’. We later decided to have a full contract (that includes labour and materials)and the above phrase was changed to read,’supply and deliver concrete rings using the materials provided’. Thus the portion,’using materials provided’ was erroneously included in the specifications for the full contract.

    The contractor supplied some pre-cast concrete rings way back in April 2011 and was paid for them using the rates in the BQ. He continued to cast more concrete rings on site using his materials and has now completed the casting.

    Now he has written a letter claiming reimbursement for the cost of the materials he used to cast the rings on site. He has submitted a list of the materials he used and their prices.

    There is a clause in the contract to the effect that,’1. Tenderers are advised to study the relevant drawings, specifications and bill of quantities and visit the site and notify the engineer of any errors or omission in the documents as the employer nor the engineer shall accept responsibilities or liability arising out of such errors or omissions.’

    We have rejected the claim on two arguments; 1. It was an error to include the phrase,’using materials provided’ in the BQ and the tenderer had a duty to point it out since it is not possible to ‘supply and deliver’……………’using provided materials’. 2. If indeed the client was to provide the materials then the contractor would have requested for those materials instead of going ahead to deliver pre-cast rings.

    He ahs protested and has indicated that he is going to invoke the arbitration clause.

    What is your view Sirs?

    1. According to the given information, There is no black or white answer on this question as I need to read both contracts to give a proper judgement.

      However, if you want to act fair on this, check the rate of the labor supply contract and the rate in the labor and material contract for the same item. If it is different, then the Contractor may not be entitled for the reimbursement of the supplied materials as the difference in the rate indicates that the Contractor has allowed for the material in his price.

  143. dear mr sameer
    greetings of the day
    can you guide/advice me to handle the situtation of penalty imposed on us because of delay in handover of project on due date .delay happen because of theft and vandalism and the same was reported to concern authority time to time through oficial letter
    that the parts required to rectify need to be imported from united kingdom naturally takes course of time includes re commissioning, even that they have imposed penalty.
    actually we are EPC contractor or ROYAL COMMISSION projet in yanbu ksa they have their own system of evaluation of penalty, on that basis they are right but as contractor we have already informed time to time about mishappenig and documented the sameor our record based on our correspondence we have requested to the same authority to waive out the penalty. that particular portion of contract handee over very late.pl send your reply on ma mail

    for any querry pl write to me

    thanks &regards

    nayyar

    1. Dear Nayyar

      I hope that I understand your question correctly.

      I assume that the authority is your Employer who wants to apply liquidated damages due to the late completion of the work.

      Since the reason of delay falls under the Contractor’s risk, the contractor will be fully liable about the incurred delays.

      However, you may review your insurance policy to seek any possible recovery resulting from the theft incident.

  144. Dear Sir,
    Any Advice for my Case,The contractor had a defect on the water proofing and the basement had a lot of leakage ,is the any clause from FEDIC that I can hold his payment untill rectify the work in basement?in the same times I want to pay directly to subcontractor to release my client from obligation of delay due to payment? the building still under constrcution .
    Thank you

    1. The only clauses that permit an employer to deduct money from the MC are clauses 39.1& 39.2 and 49.4 provided that such deduction is only made in order to help the Employer finance the repairing works solely or by others.

      In your case, the Employer/Engineer can follow clause 39. However, make sure that you give the Contractor reasonable time to repair defects.

  145. Is Preliminary and General (P&G’s) re-measurable, on a monthly basis under Fidic 99 Red Book?

    1. All FIDIC forms of contract are remeasured. However, most of the Employers change the relevant clause to lump sum contract.

      However, the preliminaries are usually listed in the bill of quantity as lump sum items only for easy pricing and payment.

      Check your bill of quantities to confirm the same.

  146. Pallab Mukherjee

    Please advise the FIDIC to follow for the conditions of contract for MEP works designed by employer. Is it FIDIC red book 1999 or 1987-Yellow book conditions of contract for Electrical and Mechanical works including erection at site.

  147. Dear Mr. Samer,

    What is the difference between the Variations work Order or Variation to the Contract and Additional work Order or Additions to the Contract.

    Thanks for your advise and clarification.

    Regards,
    Abdul Hakeem

    1. Contractually, there is no difference. Variations may have different descriptions such as change order, additional work, variatio order, etc..

  148. Dear sir,
    I am a contractor in Dubai. The contract is based on Fidic 1999, red book and it is lump sum contract. I have a question about variation order( negative variation).
    The work is not specified, nor is it contained on the drawings. It is only included in BOQ. The engineer omitted the work by variation order. I think the item is not within our scope of work because it is not specified, nor contained on the drawing.
    My question is if the item is not within the scope of work, the engineer cannot omit the item?
    If the engineer cannot omit the item, the contractor is paid becuase it is included in BOQ and it is lump sum contract?
    Thank you in advance

    1. Iara

      You are right. No negative variation can be made if the scope stated in the drawings or specs doesn’t include an item as mentioned in the BOQ.

      You should get your full contract value on the completion as per the original scope.

      1. Dear sir,
        Thank you so much.

        However I do not understand what you said ” you should get your full value on the completion as per the original scope”
        You mean that the contractor cannot get paid because the item is not within the contractor’s scope (becauseit is not specified nor it contained on drawing)?

        1. I ment that whatever lump sum contract amount, the contractor is entitled for it even if the BOQ includes items that are not going to be executed since they are neither mentioned in drawings nor specs.

          Please see other similar questions around the same issue.

  149. Hello
    I work in a project with fidic 1992. As for the waterproofing work, the contract specifid to submit a warranty period for 10 years starting from completion date. the (DLP)is 2 years. As for clause 4.2 and it’s interpretation;
    Q1- The warranty certificate to be written from subcontractor name to the employer’s name directly? Yes or no.
    Q2- what is the liability of main contractor after the contract completion(after the expiration of DLP)? in this case the balance 8 years.
    Q3- The Engineer presist to amend the contractor name inside the warranty certificate for such work. Is there any clause in fidic 1992 boost the Engineer right, please specify?
    Q4- What about intrepretation of clause 4.2
    Thank you for your cooperation
    Regards
    Mohd Eraky

    1. Hello Mohammad

      Q1- The normal approach is to provide the name of the the Employer in the warranty certificate.

      Q2- The main Contractor shall be responsible for the soundness of the structure for 10 years plus any other warranty stated in the contract.

      Q3- No, there is no particular clause about this, but you need to satisfy the Engineer as long as his request is reasonable.

      Q4- This subclause is pertaining the warranties that are not stated in the contract but will be offered to the Main contractor by his subcontractors.

      Q3

  150. I am working on a FIDIC 1999 contract as the Main Contractor
    The Employer / Engineer has specified a Marble that is no longer available in the market, however, they are unwilling to accept this and are instructing us to go back out to the market and find it. How can this issue be resolved?

    1. Hello Tony

      You need to prove that such marble is not existing in the market. It will be very tough task for you as the marble can be sourced overseas. It depends here on what your contract says to find out an exit for the case.

      The other approach is to negotiate with the Employer/Engineer to vary the work and offer some savings.

  151. Dear Mr. Samer,

    Could you please comment on the following scenario;

    In the Contract Drawings, it is noted that the boreholes should be done “at the Contractor’s expense”. However, under BOQ, an item related to boreholes(intended for the areas noted in the Drawings) was included/available during the tender stage and subquently awarded.

    Now, my query is do the Engineer has the right omit/not pay this certain item as the Drawing will take precedence over BOQ?

    1. Hello Paulsaimon

      I assume your contract is a lump sum contract. The Engineer has no right to omit the borehole amount as the Contractor should be paid the full contract price if there are no variations occurred during construction..

  152. is a contractor entitlled to extention of time due to increasing of estimated quantities in BoQ in remeasurement contract fidic 1999?

    note: quantities in drawings are not as the same in BoQ.

    1. Hello Alhawary

      This is a very good question. The answer depends on the level of details provided in the contract documents pertaining the quantities.

      In general, the Contractor should not build his clause 8 programme on the scope of work mentioned in the BOQ. However, If it is difficult to measure the actual quantities from drawings, then there may be a strong case for the Contractor to claim fro EOT based on the fact that he depend on the quantities mentioned in the BOQ for his planning.

  153. Dear Mr. Samer H Skaik,

    Please advise, what insurance clause and amount need to mention in a Contract for “contour surveying services”.

    Contract duration – max. 2 months and expected Contract amount is SR 10-30 millions.

    Thanks for your immediate advise.

  154. Dear Samer,

    In a Contract under the 1992 FIDIC, the Contractor has highlighted in his Tender that his site office would be in a particular location, let’s call it A1.

    Having signed the Contract, the Employer highlighted that it is not possible for the Contractor to utilize this location (Area A1) for site offices purposes.

    What remedies do the Contractor has in such situation?

    Regards,

    1. Hello Tamkh

      If the Employer highlights his concern after the contract is signed, then the Contractor will be entitled to recovery of any proven damages caused due to changing the location.

  155. jamesbaldesco

    Dear Mr. Samer,

    We are the consultant for a Schools project in UAE, and our contract is a Fixed Priced Lump Sum contract, utilising the latest FIDIC edition.

    My question is, in case of a change in type of a whole finish, for example, carpet at the auditorium, originally carpet tiles, but will be changed to carpet roll.

    There is a difference in the qty used in the BOQ and in the contract drawings. No change in the latest approved for construction drawings.

    Generally speaking this is a case of Omit original amount and add new amount based on the new requirement.

    For example BOQ quantity is 100m2 of carpet tiles @ 100 dh/m2 therefore, for this exercise I will delete 10,000.00 Dirhams.

    In the drawings the area is really 150 m2.

    What quantity will I consider for addition part?

    Thanks in advance.

    1. Dear James
      We have answered many similar questions before. You need to consider actual quantities only which are mentioned in the drawings.

      Regards

  156. Dear Mr. Samer H.

    We are the Consultant for a Pumping Station project here in Jeddah. The Contract is a lump sum contract and the shafts depth is 77m deep and is splitted into 4 parts/stages in the BoQ as line item. However, I’m referring/stating the description for the construction of first stage diaphragm Wall in the BoQ is “First part of pit from natural ground level to 20m below natural ground level”. whereas, contractor executed the diaphragm wall at site is around 12m, which starts 8m below natural ground level upto 20m below natural ground level. Please advise, is there any cost saving for the contract due to above difference in the height.

    Thanks for your advise.

    1. Dear Abdul

      since this is a lump sum contract and the scope is not altered, there will be no cost saving due to the discrepancy of contract documents.

  157. ARE MINUTES OF MEETING CONTRACTUAL?

    Normally we have regular progress meetings on site which is normally recorded and sent as minutes of meetings.My question is that are these minutes contractual?……Can the contractor raise variation or delay notification based on some agreement or some instruction during the meetings…or the other way around….if the engineer doesn’t give any separate engineers instruction..can he refer to that particular minutes?….
    AvinashGAJ middle eastDXB

    1. Dear Avinash

      In general, the parties should act in a good faith where MOM should hold as a true formal record. However, the use of MOM as a contractual document is debatable as the attendees may not be formal representatives of their organizations.
      To avoid any conflict, you as a contractor can consider any instruction during the meeting as a verbal instruction and raise CVI accordingly or alternatively, send a formal letter notifying the Engineer of any cost or time impact associated with the instruction and request reconfirmation.

  158. Dear Sir,
    I am referring to a Contract based on FIDIC-4 1987 with specific reference to Clause 20.4 in which Employer’s Risks are mentioned. The Sub-Clause (h) state “any operation of the forces of nature against which an experienced contractor could not reasonably have been expected to take precautions.” I am studying this aspects for a school project on the bank of a natural stream which has experienced both flooding from bank breaches as well as flash floods. I understand that Contractor may not be able to assess risks in case of flash flood. He can of course think of bank breaches by providing some form of protection to his project by constructing protective wall etc. My question is if there is a flash flood and the whole site is washed away including some work executed at site, can it be considered as Employer’s risk and paid for?
    Regards,
    Junaid

    1. Dear Junaid

      the wording of Subclause 20.4(h)is imprecise which causes many ambiguities in the interpretation of the meaning of “experienced”,”reasonably” and it is usually left to the Engineer to judge.

      In your case, it is clear that floods from bank breaches are foreseeable, so it is covered under the contractor’s insurance.

      In my opinion, the flash floods can only be an Employer’s risk if the site area has not been exposed to similar flash floods for a significant period of time, say 8-10 years. If this is the case, then clause 20.3 would apply.

      Regards

  159. Hello,

    How is it possible to use the FIDIC Red Book 99 for Lump Sum Contracts, what kind of changes in which clauses shall be made? Do we have to stick with a measurement method? I want to be a one with Payment Schedule, and LS items are paid as they are finished. Can you provide an example contract for that? You urgent answer is appreciated.

    Regards,

    1. You need to mainly amend clause 12.1 and omit clause 12.3.

      you still need to state a measurement method in clause 12.2 as any variation to the contract is usually remeasured on site unless agreed otherwise.

  160. Dear Mr. Samer,

    In evaluating a tender returns, is there any specific standard approach/practice? e.g. points system (Technical plus Commercial submission).

    Considering point system is applicable, is it correct to rate zero for the highest tender bid (commercial submission)?

    Regards

    1. Dear Paulsaimon

      There are many weighting systems available on web against reasonable fees. Just google it. You may choose your own pointing system depending on your needs and requirements.

  161. Contract is FIDIC 87 4TH Edition.(Intention of Clause 52.1 & 52.2)

    We have been given a price through a separate tender process in an “unregulated” market – UAE – for a specialist package but price seems inflated.
    Notwithstanding, package was then let under main contract. Under Clause 52.1 & 52.2 does the power to undertake further discovery and make price adjustments he considers to be reasonable?

    1. I hope I understand your question correctly.

      The only clause that deals with escalation is clause 70.1. Check your contract as most of the time, Employers delete this clause to avoid risk.

  162. I checked FiDIC fourth edition but i did not find clause 52.3(b)of FIDIC please provide the Statement of clause

    1. Here it is from FIDIC 1987 reprinted 1992:

      52.3 Variations Exceeding 15 Percent

      If, on the issue of the Taking-Over Certificate for the whole of the Works, it is found that as a result of:
      (a) all varied work valued under Sub-Clauses 52.1 and 52.2 and
      (b) all adjustments upon measurement of the estimated quantities set out in the Bill of Quantities, excluding provisional Sums, dayworks and adjustments of price made under Clause 70, but not from all other cause, there have been additions to or deductions from the Contract Price which taken together are in excess of 15 percent of the “Effective Contract Price” (which for the purposes of this Sub-Clause shall mean the Contract Price, excluding Provisional Sums, and allowance for dayworks, if any) then and in such event (subject to any action already taken under any other Sub-Clause of this Clause), after due consultation by the Engineer with the Employer and the Contractor, there shall be added to or deducted from the Contract Price such further sum as may be agreed between the Contractor and the Engineer or, failing agreement, determined by the Engineer having regard to the Contractor’s Site and general overhead costs of the Contract.
      The Engineer shall notify the Contractor of any determination made under this Sub-Clause, with a copy to the Employer. Such sum shall be based only on the amount by which such additions or deductions shall be in excess of 15 percent of the Effective Contract Price.

  163. our contract value of Project is SR 40,000,000 and contract is remeasurableaccording to units in BOQ . Quantities in BOQ were Exagerated amd as per actual site measurements value is reduced to 25,000,000 including change orders. is there any clause in FIDIC for compensation of overheads for SR 15,000,000 Please notethat we mobilised our work force for SR 40,000,000

  164. the contract is under FIDIC2006,because of Employer’s finance problem, we suspended the work accordingly, also the claim is result in, when we submit the claim report, we found that the Resident Engineer has been demobilized from site by the Employer without informing the Contractor, and the new replacement refuse to receive the claim report because of lack of power attorney.here comes my problems:
    1,our manager absent during the suspension,from site withour informing the R.E, and the letter signed by our deputy manager, is that ok?
    2,can the contractor refuse to accept the new replacement Engineer, since his English is hard understand and totally broken?
    3.about the claim report, shall we submit the claim report to the Employer only?also is it necessary for us to complain to the Employer about their negligence?

    1. Dear Sinawho

      My answers to your queries are as follows:

      1- The manager (authorized person from the firm) should give delegation to his deputy to sign on his behalf on contractual letters. If such delegation is not there, the authorized personnel of the firm could sign such as CEO or GM.

      2- Yes you can if the content of clause 1.4 applies regarding the language of communication.

      3- You need to write to the Employer notifying him of the default of the Engineer in acting as required by the contract and the Employer must act positively in this regard. The Engineer can’t refuse receiving any document even if it is not signed by the authorized signatory. He will rather write back rejecting your submission on this basis and instruct you to resubmit with authorized signature.

      Regards,

  165. Dear Mr Samer,

    I am writing a technical paper for CCE on ‘Unbalanced Bids’. Therefore would be grateful if you could advise or share some technical material/ literature like books, previous technical papers, research papers etc for the same, if you have any.

    Regards

    Iftikhar

    PS: Same request to all the readers too.

  166. thank you MR Samer for your promot reply, and i am wondering that shall i get a claim report sample somewhere, or from you there? even some corresponding letters about claim? thank your in advance.

  167. thanks for the CMGuide website, also the editor. i appreciate the professional answer for all the questions.
    i am also a contractor in tanzania, facing a Client who doesn’t always locate their finance. now we suspend the work pursuant to FIDIC2006, CLAUSE16.1,since there is no delivery of advance payment from the day we were forced to commance the work by the Engineer.the claim notice was submitted under clause 20.1, my questionis what shall i do to ensure our successful claim?although we act strictly to the contract conditions, i still worry about the effection of EOT and COST PLUS PROFIT claim. is it a DB required to secure the claim procedure?

    best regards!

    1. Dear Sinwho

      You need to follow the contract regarding the submission of notice and particulars in a timely manner. You need to keep all contemporary documents that can strengthen your claim. If the DAB is existing where you disputes the Engineer’s determination, you need to refer the dispute to the DAB.

  168. I am handling a project of Dhs. 500.00 million. The contract is re-measured and is governed by FIDIC 1987. The Contract Price of Dhs. 500.00 million includes Provisional Sums of about Dhs. 400.00 million for nominated subcontract works and contingencies. However, most of the works covered by the Provisional Sums were done by the Main Contractor as variations at the request of the Employer in order to avoid the high % for overhead & profit and builder’s work and attendance and also to avoid delays in employing various nominated subcontractors. The Project was delayed considerably and the Contractor was charged the maximum penalty of Dhs. 50.00 million. The Contractor’s claim for extension of time was rejected due to his failure to comply with the procedure as laid down in the Conditions of Contract. The final Contract Price is about Dhs. 400.00 million and the effective contract price is about Dhs. 320.00 million, thus exceeding the variation limit of 15% by Dhs. 205.00 million {Dhs. 320,000,000 – (Dhs. 500,000,000 – 400,000,000 x 1.15)}. The Employer is of the opinion that the overhead included in the excess variation of Dhs. 205.00 million should be deducted as per Clause 52.3. The Contractor’s head overheads is 12% and site overheads (preliminaries) is 10%. Thus the Employers wants to deduct about Dhs. 45.00 million (Dhs. 205,000,000 x 22%) from the Contractor which he considers as overpaid to the Contractor as per Clause 52.3. However, I do not agree with the Employer. My argument is that the Contractor was paid only the original overheads allowed in the Contract Price which is only for the initial effective contract price + 15% and he has incurred additional overheads in carrying out the variations which should be paid to him.

    I look forward to your advice.

    1. Dear Mathew

      The purpose of this sub-clause is to secure the recovery of the contractor’s overheads in case of additions and omissions beyond 15%

      According to the guide of Fidic, the Contractor overhead is usually a lump sum figure distributed uniformly over the BOQ rates. This lump sum figure should not be significantly altered when final account is concluded.

      So, if the additions are more than 15%, we need to deduct the over recovery of overheads from the contractor and the vice versa. This is applicable to HO overheads only, so, the site overheads should not be adjusted.

      The Employer has the right to deduct in the same way you explained but he should not consider the preliminaries in the adjustment.

  169. Dear Sir,

    Could you please clarify/elaborate Clause 47.2 of the Fidic Gen. CoC (1992) and give some example how to adopt the reduction noted in this Clause.Your valuable response is highly appreciated.

    Regards,
    LR

    1. Dear Paulsaimon

      Suppose that you have two twin buildings as one project where you have a TOC for one of them and you delayed the other buidling beyond the contractual date for comletion, and the follwoing information is available:
      Total project value: $ 50,000,000
      Completed Building value as certified: $25,000,000
      Damages per day $10,000
      Delay period 60 days

      The reduced actual damages for the delayed part will be calculates as follows:
      (25,000,000/50,000,000)*10,000*60=$ 300,000

      You need to know that neither the rate of LDs per day nor the maximum LDs will be reduced by this subclause.

      Regards..

      1. Thank you Mr. Samer for your prompt reply.

        However, could you please comment on the scenario below? thus it has connection with my previous query above:

        Type of Contract : Fidic 1987 (R 1992)/ Infra. project
        Contract Price: $53M (Original CP)
        Final Value:$71M (increased due to Varied Works)
        Max. Penalty: 10% of the C.P.
        Penalty per day:$109,000/-
        Original Contract Period: 9 mos.

        The Employer want to issue a partial Taking-over certificate for the amount of work $70M, and instructed (base on the work programme) that the remaining $1M balance of Work will be completed in 6 mos.My query is, how we are going to treat the penalty to be imposed(in the event of delay) for the remaining balance of works?

        regards

        1. I hope I understand your case correctly.

          if you will finish the balance works after 6 months, you will be obliged to pay the Employer the following sum:

          (1 M/71 M)*109K* (180 days).

          The formula will be valid if you delay beyond the 6 months.

  170. Dear Samer

    Are you aware of any cases where an Engineer has issued a Taking Over Certificate in advance of the date when the Contract was effectively complete in order to minimise the costs towards prolongation on the part of the Contractor.

    I have a reasonable claim of around 300 days EoT and the Engineer has just released the ToC some 6 months short of this date meaning I potentially lose the ability to claim this period of prolongation.

    I suppose my question is have you encoutered this before and do I have grounds for still claiming my prolongation for the full duration of my reasonbale EoT? I can obvioulsy dispute the Engineer’s determination o teh ToC date but this seems messy.

    Regards
    Guy

    1. Dear SMG

      It seems that there is a misconception here.

      To serve you better, I need to know the following:
      When the project was substantially completed physically? and have you been granted any EOT?

      Regards

      1. Dear Samer

        No misconception.

        I have received ToC in Feb 2010. EoT granted up to the same date. Actual completion Aug 2010.

        I believe I have proven an EoT case up to Aug 2010.

        ToC and EoT both awarded Dec 2010.

        I suppose my question is if there is a challenge on the Engineer for not acting in “good faith” by issuing a ToC and EoT some 6 months short of the actual dates therefore restricting me towards prolongation recovery.

        Regards
        Guy

        1. If you can prove that the work was not substantially completed on the date stated in the TOC, then you will have a strong case on the basis that the Engineer’s didn’t perofrm his duties fairly and impartially as per the contract.

          Firstly, you need to seek the Engineer’s decision to be able to go for arbitration. Even if you will not be happy with the arbitration, you still can file a case in the court since all common and civil law jurisdictions put an obligation over all parties to act in a good faith.

          Good luck!

  171. I found this site when I am trying to deal with a contractual problem I am coming across. So I am prompted to ask the follwing question.

    Our site was disrupted as a result of local city government intervention to see if our site and other could be used for some other purpose. Our employer then ordered us to stop the work untill then. Now the suspension is lifted after three months in which a lot of changes in price of inputs occured. We in fact had notified the employer that we will negotiate a new unit price if the works are not resumed with in 45 days. By the way the contract does not have price adjustment clause. It is known that the suspension of the site has damaged our rate of progress, profit etc. Does FIDIC has a provision for agreeing on a unit price in such condition? Does it also provide a sitpulation other than time extension to recover all the damage we have sustained including proifts, and other costs?
    Thank you in advance for your resoponse.

    yeshi

    1. Dear Yeshi

      In general, there is no clause in FIDIC 1987 allowing you to change the rates during the original duration of project.

      However, your claim for extension of time and relevant prolongation cost can include any costs incurred or likely to be incurred as a direct result from the Employer’s prevention. For example, if steel prices increase after the suspension is over, you may demonstrate how the change of steel prices affect you comparing the same with the assumption that you were able to do most of steel work prior to price escalation if there was no suspension or prevention by Employer.

      1. Dear Samer H.

        Thank you for your response and I have understood the response that rates can not be changed with in the original contract time and a price increase triggered by suspension can also be requested as long as they can be demonstrated amply. Now I have the following question in terms of two clauses (following my previous question). The first one seems to negate the second one needing your expertise-ship clarification in a contract that does not allow price adjustment, but where there is a compensation event that causes additional cost and contract time.
        The first clause: The close stated in the special condition of contract state that “Prices shall not be adjusted for fluctuation in the cost of input and delete Clause 47.1.
        Close 47.1 state that prices shall be adjusted for fluctuation in the cost of inputs only if provided for in the special conditions of contract. If so provided, the amounts certified in each payment certificate ….shall be adjusted by applying the respective price adjustment factor to the payment amounts due ….. pn = A + b (L n /Lo ) …..
        The second clause (44.2) states that If a compensation event would cause additional cost or would prevent the work being completed before the intended completion date, the contract price shall be increased and/or the intended completion date shall be extended. The Engineer shall decide whether and by how much the the contract price shall be increased and whether and by how much the Intended completion Date shall be extended.
        The issue is now, the Engineer has established that the suspension has materialized to be a compensation event entailing a time extension. But rejected the increase to be made on the contract price on the ground that the contract as stated in the special condition does not entertain price adjustment where as Clause 44.2 allow the contractor to increase the contract price since the compensation event (the suspension) has caused additional cost preventing as well the work not to be completed with in the contract time.
        The question is then does the clause laid in the special condition of contract (no price adjustment), prevent the contractor not to be entitled to a contract price increase as long as the suspension or the disruption of the work emerged to be a compensation event entailing the extension of the contract time.
        Is there any difference or similarity between “increasing contract price” due to a compensation event and “price adjustment” for fluctuation in cost of inputs.
        Great thanks in advance for your cooperation and responses.

        Yeshi

        1. Dear Yeshi

          You have referred to some clauses that are not relevant your case.

          The entitlement for an EOT with the relevant prolongation cost is completely separated from price adjustment due to fluctuations. You will be eligible to claim both.

  172. “Hello
    > We are dealing with fiddic 99(infrasture-remeasure contract)BOQ quantity increased 100 times the original,is Contractor eligible to reduce the Unit Price as per Clause 12.3 (Evaluation)and also as per Special condition-the change in quantity as descibed in clause 12.3 Evalution doesnot provide an automatic price adjustment.The Contractor shall provide all neccessary documentations to substantiate any unit prixce increase resulting from quantity changes.Please comment is Consultant have the right to reduce unit price due to quantity increase ?
    >
    > regards
    > shoaib junaidi
    > AbuDhabi
    > U.A.E”

    1. Dear Shoaib

      I really wonder why the Contractor may tend to reduce the unit rate of his BOQ! Anyway, clause 12.3 opens the door for the Contractor to vary the rate if some conditions aplly such as the one you mentioned in your letter. The contractor must submit detailed substantiation of how the rate are affected due to the increase of quantities and it is the Engineer/Consultant’s duty to verify such substantiations and whether to vary, approve or maintain the same rate of BOQ.

      The Engineer as an independent party has the right to fix the rate to the extent he feels valid or appropriate in light of the conditions of contract. if the contractor is not satisfied with the Engineer’s determination, he may dispute it following the relevant mechanism in the contract.

  173. I HAVE CONTRACT TO CONSTRUCTION ROAD TO DURING THE CONSTRUCTION THE COVEREMENT INCRECES THE PRICE OF FUEL THAT INCRECES FALLOW INCRECE IN MANY ITEM FOR THAT I WANT TO MAKE CLAMS I WANT TO HELP MY FOR CLASS FIDC

    1. Dear Hamd

      Refer to clause 70.1 of general conditions of Fidic 1987 which gives the Contractor the right to claim against any escalation in prices of labour or materials. You also need to examine the particular conditions as most of developers omit this clause to avoid risks.

  174. please i want to ask about variation order if any variation + or – it will be add before or after the retention which is usually 10%

    regards

  175. GOOD DAY TO YOU!!,

    I am impressed with this site and could not prevent me from asking advice on following:

    We are international MEP contractors. We started our operations in new contry for one project. The project was delayed due to various reasons. On the strengths of delay notices issued from time to time, we submitted our Loss & expense Claim, which is being assessed by QS. He has allowed expenses incurred by site and branch office to reasonable extent, but is not willing to allow HO Overhaeds submitted based on Emden formula, claiming that since he has allowed All expenses for branch office (which is set up only for this project). Is this stand correct. The contract is East Africa architects Association form.

    Thank you in adavance for prompt response.

    1. Hi Ravindran

      Yes, it seems ok unless your your branch had not covered the Head Office involvement such as accounting, top management contribution to project, procurement, etc…

      The assessment must be fair and reasonable to the extent that all incurred costs relating to delays are fairly reimbursed.

  176. Good day
    As per fidic 1992,it is mention in clause 67.1″whether before or after repudiation or termination”
    Q1: what is the different between contract repudiation and contract termination?
    also mention in 67.1 ” the said decision shall become final and binding”
    Q2: what is the different between final and binding?
    Q3: when the decision become final only at any level of dispute or by whome?
    Q4: same q3 but for binding?
    Q5 if the decision is binding so this mean it is final and vice
    versa?
    my apologize for the inconvenience
    Mohd Eraky

    1. Dear Mohammad,

      Find my answers to your query in the same order below:

      Q1- They are two different things. Termination is clear but I quote the repudiation definition from a trusted source that “Repudication is the breach of conditions or obligations existing as per a contract or agreement entered by a person thereby denying the existence of the contract or with a purpose to foil the execution of the contract.”

      Q2- Final means that neither party has the right to dispute the decision unless mentioned in the contract. Binding means both parties muust contractually and legally abide by the decision.

      Q3- It depends on the conditions of contract you are referring to. If the contract doesn’t specifically refer such dispute to any resolution methods such as Adjudication or Arbitration, then the only option is to go to courts.

      Q4- This is a very general question. As an example, arbitral award is legally binding unless it is proven that the application of proceedings was found illegal.

      Q5- In order for you to understand, You just need to consider that the Supreme Court order is the last absolute final decision that no body can alter or revoke. Any other mechansim is neither final nor binding even if it is stated in the contract. The governing law of such contract must confirm that the decision is fair and legal.

      Regards..

  177. Sir
    Is there any practical procedure yo prove/record ,from contractor point of view,Hpw the adverse climatic condition affect progress of work and then become a basis to claim an EOT depending on clouse 44.1 c fidic 1992.example a report from governmental meteorological authurity.
    and what the word exceptionally in the same clouse above can be proven.
    plz,reply at the earliest
    thanks for your cooperation
    regards
    m.eraky

    1. Dear mohamederaky,

      You need to enforce your claim by getting a report from the concerend authority to prove that climatic conditions were expectional which means that they have not happened for the last ten years. You can get the newspapers reports as well as supportive documents.

  178. Hi

    We are working on a “bastardised” FIDIC Contract which under the clause for Force Majeure, it states that The The notice of Force Majeure shall be given within 14 days of the party becoming aware. or should have become aware, there is no provision which details what happens if the notice is not given within 14 days.

    Are you aware of any precedents at all on this example, that we can perhaps utilise please.

    1. Dear Graham,
      Under Fidic 1987 reprinted in 1992, there is no clause stating what will happen if the Contractor dosen’t comply with the notice requirements. However, FIDIC 1999 has stated in clause 20 the consequnces of non compliance.

      Legally, such provisions will not be considered if it is proven that it is unfair. You may refer to my previous answers for more details.

      Regards..

  179. What type of project organization do you suggest for a project where the major focus is on in-depth application of technology and specialization? Justify your answer with reasons.

    1. T.Yohannes Okubay

      If your question is to mean an organizational structure of a project, where major focus is in depth tech. application and specialization. Even though a Projectized Organization gives higher level of authority for project manager to control the project resource, it is not advisable where specialization is sought as a main focus due to its temporary nature. In this case it preferable to adopt functional organization that clearly define career path in area of work specialization. According PMP(PMI) this typical organization is know as “Weak Matrix “ with level of the project manager is limited to as coordinator only.

  180. I would like to know in full details the difference between awarding a project as a Lump-sum or as a provisional-sum
    thank you

    1. Dear Ayman,

      Awarding the project as a lump sum means indicates a clear scope for execution against fixed fee without further prior instruction by the Employer.

      Provisional sums give the Employer the flexibilty whether to phyically perform the contracted works or not where a further instruction must be issued to allow you to expend the provisional sum. Check your contract provisions to see whether the Employer has the right to nominate a subcontractor to do such works instead of you or not.

  181. Dear Samer

    With respect to a signed Sub – Consultancy Agreement, FIDIC, 1st Edition, 1992, where the Consultant so named therein had elected not to honour his payments due to the Sub Consultant who performed the works in accordance with the agreement and to completion. The Consultant was paid his dues from the Employer. The Consultant was eventually declared insolvent and insolvency proceedings are ongoing against consultant. The Consultant is a limited liability concern which is part of a group of companies. What recourse does the sub consultant have to recover its dues, apart from filing a claim under the ongoing insolvency proceedings.

    1. Hello Vicky,

      Since the consultant as a firm has limited liability, I think there is no other option but to calim under the insolvency proceedings.

      However, you may check your contract thoroughly as a last resort. If you prove that any other firm within the group was part of the contract such as paying your fees on the consultant behalf, you will have a basis to claim your dues from such firm through legal proceedings.

      My advise to you that you need to consult a lawyer to get better advice.

  182. I know this is not Contract specific question, but the wealth of knowledge towards legal issues in Dubai leads me to believe the answer may be available on this site.
    As an Employer’s Representative I am being pushed to accept a variation request by a Contractor, supported by the Engineer, for temporary drainage solution to deal with AC system flushing water.
    The variation is for the water to be tankered away to a plant that deals with the disposal of this type of liquid waste.
    I am used to this system being used in all cases in Dubai due to the lack of a storm water network.
    The Contractor is claiming he can discharge the flushing water into the drainage system.
    I have investigated this and found only one generic reference to the disposal of liquid and harzourdous waste in Law 24 of 1999.
    Is anyone able to advice which Regulation, Law or Code deals specifically with the disposal of liquid hazourdous waste into water networks.
    Again I apologise that the question is not Contractual in nature but ran out of places to ask the question. The DM websites are not great grounds for research on this sort of issue.
    Any assistance would be greatly appreciated.
    Guy

    1. Hello friend,

      You may not find a direct answer here. My advisce to you, that you need to force your Consultant to search for the answer prior to instructing the work as a variation.

      You need to know also that the Contractor must abide by the local regulations and he should have considered in his price the cost of draining.

  183. under a 1987 fidic 4th edition contract,for a varied work instructed by the engineer to the provisional sum scope of, say, MEP works, which way the contractor can claim for additional price:

    *Option 1: Normal Variations(like claim from the subcontractor + percentage uplift mentioned/allowed as mentioned in the BOQ to be applied for variations to the main COntract scope of work)

    OR

    Option 2 :Provisional Sum Adjustments ( like claim from the subcontractor + Attendance + BWIC + OHP as mentioned in the Provisional Sum BIll.)

    The problem, what I am facing is that, the Engineer is not willing to approve any amount against the BWIC, when I adopted the option 2 (Please note that the BWIC is not priced as a percentage against the PS items, instead an amount)

    What will be chance of winning, if I adopts the Option 1.

    Expecting a prompt reply.

    Suresh.

    1. Hello Suresh,

      The ideal approach for evaluating the variation of NSCs is to add up the following to the NSC’s quotation:

      -Associated Builders works if any.
      -Associated attendance such as special scaffolding or requirements if any.
      – HO overheads & profit. You may use the markup mentioned in the contract, otherwise, you need to prove the HO and negotiate a reasonable profit.

      You need to remember that the attendance, BW and markup margins mentioned in the BOQ for PS items are only applicable for the original scope.

  184. What is the process after a contractor is in default of a construction project and turns it over to the bonding company?

    1. Hi Gene,

      Terminate the employment of the Contractor if your contract allows or try to seek a court order for terminatin the contract. You need to consult a lawyer to examie the relevant provisions of the civil code.

      In the UAE for example, you can’t terminate the contract if there is no specific provision in your contract documents allowing you to terminate. Otherwise, you need a court order.

  185. Dear Sir,

    actually I am in chrage of the execution of a FIDIC-Silver-Book contract (1999). Much to my regret Employer`s Representative unreasonably withheld a datermination of my current claim for Extension of Time for Completion. Employer`s only replay was that my claim is “not applicable” and “is rejected”.

    How to proceed in accordance with the contract, by avoiding the initiation of the DAB?

    Many thanks in advance for your reply.

    Kind Regards

    John Froehl

    1. Dear John,

      The problem in the industry is that the main players are not well educated to administer the contracts and realize the consequences of their actions.

      Anyway, resolving disputes must pass by negotiation in the first place as the best shortest way of resolving disputes to try to reach amicable settlement on your claim. If failed, try to agree appointing a mediator to look into the case from a neutral point of view.

      Finally, you must start DAB since it is the safest place for you after exerting all such efforts.

  186. Dear Tasnim,

    The easiest way to analyse the delay for the contractor is to use Impacted As planned method.

    You need to inset the delay event which is incurred already as an activity in the programme with a duration reflecting the actual delay then link it with the succeeeding activities that will be physically affected by it. The change in the date of time for completion will reflect your entitlement for EOT.

    Regards,

  187. Dear Mr. Yusoff,

    My suggestion is that to prepare a cronological events of delay Items. and input the actual dates against the impacted items in the programme. prepare a comparitive study between the approved programm and the impacted programm. that will be clear to justify your EOT, if you already noticed to the client with the time FIDIC allow.

    Hope it will Help you.

  188. Dear Samer,

    I have a para in BOT contract which i do not like but we can not change it. So please advice how to act aginst such thing if happen during the construction of the project.
    ” During any stage of the Project construction work OWNER reserves and shall have the right to reject any materials, supplies, tools, machinery or equipments which, in its reasonable judgment, do not(a) adequately satisfy or conform to the Specifications, or (b) do not include all services required under this Usufruct Agreement. Accordingly, OWNER may, in its sole discretion, issue an order to the Developer directing him to do, at its expenses, any or all of the following:
    Remove and/or replace from the Project Site any materials, machinery, equipment or supplies that OWNER, acting reasonably, deems defective or not in conformity with the Specifications, provided that such removal must be carried out in an orderly fashion and within the time frame specified by OWNER’s said order.
    Remove any work not in conformity with the requirements of this Usufruct Agreement as deemed reasonably by OWNER with respect to meeting the quality standards for materials and workmanship embodied in the Specifications, notwithstanding any previous approval granted regarding the same

    1. Dear Adel,

      If the Employer -in your point of view- misused this clause, you may serve a notice of a counter claim as may be stated in your contract and you should keept such contemporary records that substantitate your argument. This is to prepare you for any dispute that may go to arbitration or courts.

      Regards,

  189. hi everybody

    If there is a variation work to a nominated subcontract work, can i increase the % of attendance and profit on the variation works or the % of attendance and profit priced in the contract shall be applied on the variations works.

    Wait for your quick response

    Soomun

    1. Dear Soomun,

      It is difficult to change the profit percentage unless you prove that this percentage is inappropriate. About attendence, you can claim the actual attendence incurred for the variation works such as special scaffolding.

      Regards,

  190. Upali Mallawaarachchi

    This is regarding an expressway contract based on FIDIC 1987. Contractor has shown 35% as his overheads and profit percentage in the tendered rate breakdown, which was submitted as a supporting document only, but not a fully binding document in the Contract.

    For new items instructed, it is essential to use 35% mark up?

    Can the Engineer use different percentages for different new items, based on the Contractor’s involvement on each item? e.g. if it is only supply of some goods (directly bought from a shop), a smaller percentage such as 10%

    1. Dear Upali,

      In the absense of an express term fixing the markup on variation items in the contract, the Engineer should fix a reasonable profit on all items and request the Contractor to submit evidence about HO oveheads (Usually calculated as a n average of the last three years from the Audit report).

      It is neither reasonable nor apprpriate to vary the markup percentage depending on the nature of the vairation item.

      Regards,

  191. Dear Samir,

    I am working for a construction company as a planner in Dubai. We had delays in the project during its progress. We submitted 9 separate claimns for 9 separate events. The cummulative of 9 events was coming around 142 days. Consultant approved 78 days. Now there has been an argument between myself and consultant regarding the analysis.
    Consultant actually checked just only the actual dates from asbuilt program and impacted on baseline program which gave him 78 days which were exactly the delays which were showing in the update program which nullified all the good work done by us during the project and it also implies that if we had ben slow in our work we would had got more days.
    My analysis included the following principle points.
    1. Analyze each claim as a separate event.
    2. Provide documentry evidence in supprt of our claim.
    3. Use Asbuilt program / Updated program to get the information regarding the events.
    4. Finalise the delay for each separate Event.
    5. Impact on the baseline program by adding a constraint on the respective activity.

    Now we have agreed for a third party mediation. Kindly advise me about my analysis method.

    1. Dear Idris,

      There are many methodologies of delay analysis. Selecting any of them depends on many factors such as the accuracy of work programme, availability of contemporary records and the comlexity of delay events.

      In general, the Engineer seems fair in his determination as there was no further delay in light of the critical path anaylsis. You may have a case if you have conveyed to him in writing about accelearation and if you have served a ntoice to claim additional payment or the like.

      In the absence of due detemrination by the Engineer on any claim. the Contractor may be confused whether he should accelerate to avoid LDs if his claim is rejected or to keep the rate of progress as it is and accordingly his entitlement -if any- will be limited to the actual delay incurred to projecr progress.

      Regarding your analysis, a) you need to demonstrate the concurrent delays if any by using critical path analysis. This will enable both of you to determine the dominant delays and liablities of each party accordingly b) You need to have an updated programme reflecting the actual progress of critical activities when each event has occured prior to adding the delay events. c) You can impact the actual delays on the base line programme if it still has proper logic and has no errors, otherwise, you may only be entitled for the maximum delay you got from each delay event only.

      I advise you to read the two articles about the delay analysis in CMGUIDE for further info.

      Regards,

      Samer

  192. Hi everybody,

    I need advice on the following issue.

    FIRST,
    The contract is fidic 1987 reprinted 1992. Contract B.O.Q. includes division 1 for general requirements it is priced by us and it represents almost 4% of remaining total contract price.

    The Engineer recently and during his determination to submitted variation order decided to deduct an additional 4% as prelims on the “omitted part” of variation order and claimed that the 12% which he is adding as overhead & profit to the “addition part” of the same variation already includes the prelims which he previously deducted.

    The above referenced variation order has only cost impact without any time impact on project completion date.

    My question is:
    1.- Does the Engineer have the contractual right to deduct prelims from omitted part of any variation order?
    2.- Other unit rates in B.O.Q. under divisions 2 to 9 already include overhead & profit. Are the prelims under division 1 the same as the O&P priced seperately for each iten under other divisions?

    SECOND,
    The Engineer consented to the addition of 20% as overhead & profit on dry cost for numerous variation orders submitted by the Contractor. Almost about 30 variation orders. Recently, he decided that the O&P % for any further variation order shall be 12%.

    Does he have the right to do so under the contract?

    I am anxious to receive your reply.

    Best Regards,

    1. Dear Nerses,

      preliminaries only include site overheads costs during the project life cycle from commencement to completion. off site overheads and profit are distibuted on the main works in the BOQ.

      There will be no alteration to the sum of preliminaries unless the contractor is granted an extension of time. Variations whether additions or omissions have nothing to do with preliminaries and the Engineer has no right to add or deduct from it for the assessment of variations of whatsoever nature.

      if your contract is silent about the percentage of overhead and profit, then the Engineer has the right to ask for a proof about the actual offsite overhead and he will determine a reasonable profit. Engineer may revise any assessment he gave before for variations as he believes appropriate. The contractor is still entitled to dispute any unfair determination or decision in this regard.

      Please don’t hesitate to contact us for any further clarification.

      Samer Skaik

  193. hi everybody

    i would like to discuss an interesting case and would like to have your comment.

    we got instruction from the PQS to appoint a nominated supplier for the sanitary appliances and accessories.

    We appointted the subcontractor and ordering as per the quantities and specification given by the PQS. the delivery time was 4 months from date of order.

    The supplier made his order with his overseas supplier and the goods will arrive in the country by the end of june 2010.

    The issue is the bath tub and the fittings.

    The supplier ordered the bathfiller as per the reference in the PQS list.

    when the supplier deliver the bathtub and the fitting to site , the contractor noticed that the fitting (i.e bath filler)the length of the pipe from the tap to the waste is short and need to be re-order.

    The supplier did not accept this responsibility and said that what have been ordered according to the reference in the PQS list is a standard one and another type of bathfiller is required to cater for that.and that will involve additional cost.

    The supplier is asking for an extra over cost for re-order of the new fittings.

    My question; who will bear the extra cost, the main contractor,the supplier,the PQS,the Employer.

    Please advise.

    1. Dear Soomum,

      You have to consider many things to answer this question.
      The form of contract between parties, contractor’s objection right of nomination, contractor’s involvement in preparing nomination package, etc…

      Anyway, as I understood, the Contractor was not involved at all in the selection and supplier has supplied material as per order, so the PQS is liable for such error. Since PQS is employed by the Employer under a specific service agreement, Employer will be obliged to pay the extra cost and compensate Contractor for the delay and he may seek to deduct damages from his PQS if the contract allows him to do so.

      Regards,

  194. akbalfour@gmail.com

    Hi Samer

    Is there any specific clause under FIDIC or any case law, which states that if there is a material increase in cost of a priced item in a BQ, say for instance reinforcing steel, that the Contractor can only be paid for the additional increase in cost, exclusive of OH & Profits? Is there no entitlement to this and/or can it be claimed for otherwise?

    1. Dear,

      Clause 70.1 of FIDIC 1987 reprinted in 1992 deals with the increase or decrease in cost. About profit and overhead, it must be considered when calculating the impact of changes, as a fair practice unless it is mentioned otherwise in your contract documents. Clause 70.1 refers to ‘sums’ not costs which means that markup can be considered.

  195. 1. Thank you for your prompt reply , further to my query for the negative Variation of Lump Sum Contract , pls advice whether we can add OH & profit for omission of Duplicate BOQ Item or not.
    2. In addition, when the Engineer can Use Star Rate to issue variation order for Lump Sum Contract ( Fidic 1987).

    1. Dear Barhoumy,

      1- There is a misconception here. You can’t omit any work unless it is shown on drawings or specifications. BOQ is only schedlue of rate and any error or duplication can’t be rectified through variation procedures.

      2- If the item under concern can’t be evaluated based on BOQ rates, then Contractor shuold build up new rate which will be subject to Engineer determination. Engineer still has the right to fix the rate as he feels appropriate.

      Regards,

  196. akbalfour@gmail.com

    Hi Samer,

    Re-your response to elaborate on the first part of the question: A Prelims breakdown was provided to the Consultant, showing the various allocations to the items as per the initial, running and final costs, based on the scheduled timeline. The allocations were then amended after being submitted to the Consultant to suit their take on the it. Again, can they do this? I hope this clarifies the mix up.

    1. Since the prelims breakdown is not part of the contract documents, the Engineer has the right to give his determination as he feels appropriate. However, I understand that the prelims are usually lump sum items and regardless of the breakdown you need to give for easy valuation of your interim payments, you are still eligible to receive the full prelims amount on project completion.

      Best regards.

  197. akbalfour@gmail.com

    Hi Samer,

    Firstly, can a Consultant simply amend the Preliminaries of a Contractor’s contract, without consultation? And secondly, if provisional Sums are used in the Prelims for say ‘the employer’s telephone line’, can this be omitted in the calculation of the running cost value?

    Best regards

    1. The first part of the question is not clear. Please elaborate on the case.

      About second question, if you got an instruction that provisional sum is to be expended, then the Engineer has no right to deduct the relevant amount fro mthe running cost

      Regards..

  198. I am working with a contractor in UAE, in a major project and we are in a process of submitting a negative variation order upon Engineer Instruction. The condition of contract is FIDIC 4th edition 1987 reprinted in 1992, and the contract is a lump sum.
    Regarding the Negative Variation Order, Please confirm that can we Add the overhead & profit to this Negative Variation instead of claiming the same later on? Or we can’t , As per condition of particular which states the following:
    “”
    CLAUSE 52
    Sub-Clause 52.1 – Valuation of Variations
    “Delete the text of the Sub – Clause and substitute.
    All variations referred to in Clause 51 and any additions to the Contract Price which are required to be determined in accordance with Clause 52 (for the purpose of this Clause referred to as “varied works”), shall be valued at the rates and prices set out in the Contract if, in the opinion of the Engineer, the same shall be applicable. If the Contract does not contain any rates and prices applicable to the extra or additional or omitted work or if any rates and prices stated in the Contract are unreasonable in the opinion of the Engineer then suitable rates / prices shall be determined in line with the following basis of calculation for each element of work:
    a) Actual cost of material delivered to site
    b) Actual cost of labour.
    c) Actual cost of plant and machinery.
    Actual costs shall not include any off site or on site management costs or other overhands.
    Overall mark-up for each type of works have to be agreed upon between the Engineer and the Contactor according to nature of work, but not exceeding the following maximum limits of each type of work:
    a) For work performed directly by the Contractor: – 10% of actual costs
    b) For work performed by Subcontractors other than nominated Subcontractors:

    Subcontractor’s mark-up = 10% of actual costs.
    Contractor’s mark-up = 8% of Subcontractors cost (exclusive of mark – up).
    c) For work performed by nominated Subcontractor (nominated by the Client):

    Nominated Subcontractor mark-up = 10% of actual costs
    Contractor’s mark-up = 8% of nominated Subcontractor’s costs (exclusive of mark-up).
    Actual rates and prices should be calculated after all trade discounts and the Contractor should support the cost estimate for each element of related works by the provision of evidence of applicable actual expenditure to the satisfaction of the Engineer.
    The Contractor shall bind his Subcontractors to the same method of calculation and mark-up limits for the cost of variations as the Contractor is bound under this clause.
    Wherever the BOQ rates are used in the evaluation of variations as per the first sentence of the first paragraph of Sub-Clause (52.1), the Contractor shall not be entitled for any mark-up and shall not be entitled for any additional payment. ‘’’’
    Kind Regards

    1. Dear Barhoumy,

      I understand that your question is about the compensation of overhead and profit as a result of ommission of part of original scope.

      If this is the case, you can only claim H.O. Overhead at the end of the project when it is concluded that the variations are exceeding 15% in negative pursuant to clause 52.3

      You are not intitled to claim “loss of profit” unless the omitted work is going to be awarded to another contractor whethere prior or affter the issuance of taking over certificate.

      By the way, I like the particular conditions you insert here. Thank you for that..

      Please approach me again if I misunderstood your question or if you have further query.

      Regards..

  199. Felicia Cheah

    May i get your assistance on :-
    a) delay due to NSC & subsequent LAD was imposed by client, can we reject OR re-navigate to NSC ?
    b) if yes, how to impose & get deducted from NSC since the payment made to NSC is directly from the client ?
    c) any better choice on win-win situation ?

    Thank you. rgds.

    1. Dear Cheah,

      The answer may vary depending on the terms and conditions of the nominated subcontract agreement. however, I can give a general answer to your question in light of the standard forms of contract:

      a) You should accept the LAD’s and deduct all losses and damages from your NSC.

      b) I think that the contractor is processing the payment appplication for all his subcontractors in cluding NSC and The Employer will pay accordingly provided there is an agreemnt in this regard. You may implement the deduction in such payment. If not applicable, try to have a joint meeting with the Employer to seek a solution.

      Otherwise, you may seek arbitral award or a court order, and most probably, you will win te case depending on the extent of the soundess of your contemporary records.

      c) Negotiation is the best approach. Try to stick to it as long as your rights are not compromised.

      If you need further assistance, you may approach me via my email.
      samer@cmguide.org

      Warm Regards.

  200. Zenith Sharma

    Dear Mr. Skaik,

    In FIDIC 1999 Red Book, we are much confused with the two words “consent” and “approval”. In the dictionary, we found the similar definitions. What are the fundamental difference between these two words? In which conditions, we use “consent” or “approval”? Is there any written confirmation required in the case of “consent”?

    Hoping for your kind response in this regard.

    Zenith Sharma

    1. Dear Sharma,

      This question is not confusing you only. it did with the committee members of FIDIC who are drafting and updating the provisions of FIDIC forms. I asked the same question to them but there was no definite answer.

      According to them, there is no significant difference as both words mean to ‘give permission’.

      In my opinion, there is a differecne in terms of the nature of obligation assoicated with the use of each of them. ‘Approval’ seems to have a stronger impact than ‘consent’.

      Regards

  201. I mean an arethmatic;1. error not in the rates but in carring forward totals.2. Error in quantities 3.omittions in boq

    1. Hi yoga,

      If it is a lump sum contract, then the contractor has to perform the work agianst the fixed lump sum price. There will be no remedy for the original scope of work.

  202. In accordance with fidic 1999 a contractor shall give notice prior to ask for extension of time.The contract clearly described the time bar for claiming extension of time.

    If the contractor have not submit notices; Is the contractor lose his entltlement for extension of time?

    I hear that there is remedy in common law under the doctrine of” unjust enrichment”. Is it true? please explain.

    If it is true why putting such clause in contract where legally it is not binding.

    Your comment on this matter will be much appreciated.

    1. Hi Soomum,

      This is a very interesting question.

      Contractually, the Contractor will lose his entitlement. Legally, it depends on the governing law.

      From my expereince, common law and UAE civil code do not deny such entitlement. Under law, The Employer can’t get benifit or add value to his property without paying for it regardless a notice is served in this regard or not.

      FIDIC is an international standard form of contract and the governining law can overrule it if there is contradication only which may not be the case sometimes.

      Regards..

  203. We are executing a Project in Pakistan under FIDIC 1987 edition. We offered a rebate of 5% at our bid price, which was applied to BOQ unit rates. At later stage some design changes and new works incorporated and BOQ rates applied for the additional quantities. For this varied work the rebate will be applied on BOQ unit prices or not……………..

    1. Hi hamid,

      I have already answered a similar question above. In your case, you should apply such percentage for variation works since it is not a lump sum discount on the contract price.

      In addiiton, keep in mind the BOQ rate can be used as a basis for evaluation of variations if such rate is appropriate.

    1. Hi Soomum,
      If the supervision cost is not included for the contract period in the contract (usually in preliminaries), then you are entitled to include all costs necessary to execute the variation works including supervision.

      Regards,

  204. please conform to me the following:

    when a contractor apply for a claim of extension of time.

    in accordance with FIDIC 1999 is it within 42 days from date of our application that the project manager shall give his response.

    and if he does not response within that period; what are the consequence.

    1. Dear Soomun,

      If the Engineer does not give his determination whether with approval or disapproval within the 42 days, the Contractor has the right to claim damages or losses as he feels appropriate provided he serves a notice in this regard.

      I suggest to keep pushing the Engineer to give his determination and involve the Employer in this matter till it is settled.

      Warm Regards,

    1. Hello Soomum,
      There are many methodologies for delay analysis. The easiest one is to insert the delay event as a new activity in the programme then run it to see how such delay affects the date for completion.
      The delay impact will be calculated as follows:
      Revised date for completion – original date for completion = EOT duration

      I also refer you to CMGUIDE articles about the same issue. Kindly use search form to find out.

      Regards..

  205. Dear Dr. Samer,

    Thank you very much. According to your second reply, I may submit delay notices, but What can I do to approve my right for entitlement?

    I want to know the consultant have the right to ask for the reduction in time based on what? Conditions of contract or best practice?

    Thank you very much and I really appreciate your reply
    Ramy

    1. Hello Ramy,
      Engineer’s determination is based on the best practice if there is no clear provision in the contract to refer to but you still have the chance to oject his determination and request Engineer’ decision then follow dispute resoultion provision as stated in the contract.

      I already clarified in the previous response the extent of the right that may be exercised in case of reducing a task duration. You need to examine if you really can do such task with the same planned resources or not. Accordingly, you may have a room to challenge such request.

      Regards..

  206. I have a situation here: For one of our projects the contract is not FIDIC, we have submitted our program of works and it is approved. The original duration of the project is 30 months. Then the client has nominated a new consultant instead of old one. We have been requested to revise the program after adding agreed extension of time. Then we have submitted the program to consultant to approve. Current situation on site that client has the control on some finishes items. Those item are in delay due to late nomination by client. In order to cover client delays due to late nomination, we got comments from the consultant requesting us to reduce the tiles duration in each floor from 10 to 8 days. Now the program consented with comments by which one of them about the tile installation duration.
    My questions are:
    1-Does the consultant have the right to ask for this reduction? If yes, based on what? Conditions of contract or best practice?
    2- In this situation could I based on the consented program submit an extension of time claim? If no, what to do to approve my right for entitlement?

    1. Dear Ramy,

      Thank you for this question.

      As I understood, there is a delay from the Employer in doing his part of procuring/selecting finishing materials, therefore, you are requested to squeeze some critical activities to creat a float in the program to absorb the Employer’s delay.

      I would like to pay your attention that the appointment of another Engineer should be approved by you first as it may affect your price and programme of work depending on the case.

      About your questions, I reply in the same order as follows:

      1- The Engineer has simply asked you to accelerate the activity supposing that the reduced duration is still reasonable to complete the activity. If you prove that it can’t be done without extra payment, then he has no right to request so.
      Hint: Check the normal productivity of your labours and the allocated resources for this activity to prove your case.

      2- The consented program is considered the project baseline program. Both parties of the contract can monitor the project delays accordingly. You may -at any time- submit delay notices followed by the EOT claim particulars as per the timeline stated in your contract.

      Please don’t hesitate to approach us for any further clarifications.

      Samer Skaik

  207. Realy it is a GREAT WORK.

    Dear Samer, I would like if you can help me to find UAE Civil Law or in other words UAE Construction Law whether as PDF File( Which I prefer) or as Hard Copy.

    Regards

    1. I have a hard copy of the Civil code concerning Muqawala contracts and the general articles. I will try scanning and send them to you shortly.

  208. Dear Mr. Samer,

    I would like also to ask you if it legally applied and correct if i stated in the special conditions of Fidic 87 that “the clauses of “Claims, Disputes and Arbitration” article 20 of Fidic 99 shall substitute the clauses from 67.1 to 6.4 of Fidic 87″
    in order to avoid the tricky procedures of Fidic 87>

    Best Regards
    Mohamed A. A.

    1. This is not a good idea Mohammad.
      The sturucture of Fidic 1987 is totally different and you need to specificly amend any the clause you don’t like using the description from other source provdied it will not create any confusion or contradiction in the contract documents.

  209. Dear Mr. Samer,

    Really great work, I appreciate.

    i would like to ask about the Engineering in the Fidic 87 how is be obligated in such contract however he is not a representative party?
    on other hand i heard about the fidic white book so it related?

    Best regards

    1. Dear Mohammad,
      I wish I understood you correctly.

      Engineer should work impartially in the project according to FIDIC 1987 regardless of getting paid by The Employer.

      FIDIC white book is the standard form of contract for consultancy services between the Employer and the Engieer. It doesn’t force the Engineer to give any determination in the favor of the Employer at all.

  210. Vachhrajani Jayesh

    Dear Mr. samer
    I am a regular reader of CMguide and the inputs are very educative.Please advice on following.
    In our contract BOQ various items are in provisional sums and at the time of award an amount is seta side for each item.While after actual nomination by client the nominated amount is less than the allotted provisional amount.Example is given hereunder.
    A Supply of ……………………..3,000,000
    OH & Profit @ 3.5% 105,000
    Attendence 172,500
    Builders work 172,500
    You will notice that the contractor has put 15% towards OH & P, Attendeance & BW.
    B On actual award the nominated amount is reduced to 2,000,000.Please advice if the contractor is still eligible for attendence and Builders work as per lump sum amount or to be adjusted to 15%.
    In the Appendix to the form of Agreement ,percentage of Provisional sums persuant to 59.4 c is 15%.
    Please advice
    Best reagrds.
    Jayesh Vachhrajani

    1. Hello Jayesh,
      Thank you for your question.

      You will be only entitled for 3.5% of the provisional sum amount plus 172,500 attendence and 172,500 BW. attendance and BW are lump sum amounts in BOQ and can’t be adjusted.

      If there was no provision for profit in the BOQ, then you could use 15% percentage in appendix to tender. Refer to clause 59.4 (C).

      Regards,

      Samer Skaik

  211. I’m working in Dubai and my Company’s role in one project is MEP Subcontractor. GC (General Contractor) suspend all the works in the project due to his disputes with the owner regarding delay penalty which the owner decided to apply to GC and deduct its full amount from the GC’s next running bill. The suspension now is exceeding more than 100 days and we don’t have any idea when the GC will resume the work in the project.
    If Our Contract is not under FIDIC contract and there is no suspension provision in the contract agreement, is there any chance for us as a subcontractor to terminate our contract with GC after this long suspension period then claim him with all related damages?

    1. Hi Owies,
      If there is no clause in your contract about termination, then you will need a court order to terminate your contract. Your case will be strong if you can prove that the other party is in default and he didn’t commit to his obligations under the contract. Refer to article no. 267 of the UAE Civil Code.

      Regards..

      1. Thank you Samer for your reply
        I already before i come here checked UAE civil code but i didn’t find any thing regarding my problem , the GC is not in default regarding our contract but may be he is in default with the owner
        and my question is how long i should wait the GC to resume the work in the project ? is there any limit ?
        also please consider the following additional information related to our contract :-
        1-We are nominated subcontractor in original
        2-our payment term in is back to back
        3-Termination for convenience is allowed in our contract with GC
        Is there any chance for us to recover our due payments with like this situation ? 🙂

        1. Firstly, the main contractor does not have the right to suspend the works on such basis, therefore, he is in default. You, as a nominated subcontractor can seek payment recovery from the Employer.

          Secondly, you need a lawyer to help you interpret the articles of civil code and how it can be employed to serve your case. However, there is a principle in the code that:

          If one party fails to commit to his obligations under the contract, then the either party has the right not to continue with his commintments under the contract. in other words, you can seek termination of the contract accordingly. please refer to article

          Moreover, you can refer to article 272 of the civil code.
          Under Article 272, if a party to a contract does not do what they are obliged to do under the contract, the other party may, after giving notice, require the contract be performed (specific performance) or cancelled.

          Regards..

  212. Vachhrajani Jayesh

    Dear Mr Samer
    Due to proximity of artificial creek in a project flooding occurs and water enters the ongoing project work of basement.Under the terms of contract FIDIC 1987, reprint in 1992, please clarify.
    1. Is this an Employer Risk?
    2. Is the contractor entitled for Extension of time along with prolongation cost.
    Thanks & Regards,
    Vachhrajani Jayesh

    1. Hello Jayesh,

      Thank you for this question.
      This event is not an Employer risk. It is the contractor’risk and his insurance (CAR) usually cover such risk. Please review your premium conditions.

      Accordingly, you will not be entitled for cost or time recoveries from the Employer.

      Best regards..

  213. FIDIC Contract 1987 provides Clause Clause 70 Changes in Cost and Legislation. However, this Clause From Sub-clause 70.1 to 72.2 has been deleted in the Contract Particulars. We have experienced sudden increased cost of materials during construction. How can we claimed the cost for fluctuation is our rights to claim for increase cost of materials extinguish due to the deletion of the fluctuation claus? Please advise.

    Thanks

    1. Dear Bernard,
      Since the contract now is silent about such matter intensionally, it is debatable. You can claim such costs and dispute it hoping that the applicable law provisions in your country allows something in your interest.

  214. Sir,

    We have just awarded EOT pursuant to Clause 44.1 under FIDIC contract 1987. However, the Client rejected payment for indirect cost (prolongation costs) on the basis that under Clause 44.1 only time is allowed for relief. Which contract provision In FIDIC 1987 can we claimed for indirect costs due to EOT…
    Thanks

  215. Dear Sir,

    The Contractor submitted an EOT Claim with a Time Impact Analysis (TIA) based on ‘Impacted As Planned’ method . However, the Engineer (with proper reasons) is of the opoinion that this methodology cannot be applied in our Project and especially for the Events claimed.

    The Contract is based on Fidic 1987

    Now, my questions are;
    1) If the Contractor submit a revised TIA (prepared using another methodology), Engineer has to consider it or not?
    2) Is the Engineer bound to ask for a revised TIA before issuing final determination?
    3) If the Contractor fails to or refuses to submit a revised TIA, can the Engineer prepare one to justify the Determination?

    Thanking you in advance;

    Mohamed H

    1. Dear Mohammad,
      In general, there are many methodologies for delay analysis. adopting of any method depends on the complexity, the extent of the availability of information, etc…

      1- The Engineer is not obliged to stick to any method since the contract is silent about it. He also has the power to review Contractor submission and give a fair determination based on the Contractor submission beside his own exercise.

      2- Yes, he is if the request is reasonable and not to delay the determination purposely.

      3- Yes, he can.

      Regards..

  216. This is an issue for requesting new rates for the design variation requested by the Engineer.
    However the contract states that all variation to be determined in accordance with clause 52 (Valuation of variations)

    Do we have right to request for new rates for all variation and we stand on our grounds that all varied works instructed by the Engineer to be assessed with present rates as the BOQ rates are are rates established in 2004

    1. Dear Sunil,
      BOQ rates can be used as a basis for evaluation provided they are reasonable and appropriate. Moreover, if the contract was extended formally via EOT claim, then your case will be stronger to claim new rates.
      Regards..

  217. Is it an issue if the employer’s representative provide the designs of Variation Order Items or BOQ items requiring design changes under a design and construct contract which includes a BOQ

      1. In other words do you envisage any potential problems if under a design and construct contract where some elements of design work has been done by the employer or the employer’s representative and a BOQ has been provided against which to bid for related items in the Bid Document but during the execution of the contract, variations are required and the employers representative does the designs instead of allowing the contractor to provide the designs for subsequent construction by the contractor in terms of the contractor’s liability for those designs

        1. There is no provision in the design construct turnkey contract allowing the Employer to design. He can vary the contract by asking the contractor to submit a proposal based on his concept design.

          However, if the Employer insists on designing some variation works, he must indeminfy the contractor for any failure in the provided design and he should be liable for it. This can be done by an amendment to the contract.

  218. Hi Samer,

    Can a Contractor, who has signed a lump sum contract to do restoration works to some buildings, several of which have been issued taking over certificates, claim for extension of time, even though there are outstanding works (not necessarily defects)to be completed during the defects liability period? If yes,what are the implications?

    1. Hi Kenwyn,

      The contractor can claim for EOT if any event takes place from the list mentioned in clause 44.1 of FIDIC 1987.
      As a result, the contractor can claim prolongation costs if the EOT is valid.

      Regards..

  219. Dear Samer,

    I have one more question.
    In a Lumpsum contract for the adjustment of PC rate when there is increase in the supplied rate than mentioned in the BOQ rate, does we ccan consider the actual quantity from the drawings which comes more than the BOQ quantity and there is neither changes in the drawings nor any instructions for changes.(The BOQ quantity is wrong)
    Thanks

    1. If the PC rate changes, then you will have to calculate the difference in cost by the actual quantities. Forget about BOQ quantities in lump sum contracts.

      Regards,

  220. Is it Correct to reduce prelims running price relevant to a concern month, if the Contractor did not complied with the requiremnts of