Construction Management Guide

464 Responses to “Ask CMGUIDE”

1. M A Naszer Says:
   February 14th, 2009 at 11:02 pm

   In FIDIC 1987/92 (foruth Edition) Contract Conditions;

   Is there any time frame or time limit in replying to the Contractor regarding to the variation issuies, such as teh disputes in the variation amount calculation or in teh methode adopted to value of teh varied works etc.

   As I know about the 14 day contractual issue to reply to letters, but do VO`s fall under the same thing or something else?

   Plese reply to me at you earliest convinience.

   Thanks and regards
   Naszer

   

   Samer Skaik Reply:
   July 1st, 2009 at 4:15 pm

   Dear Mr. Naszer,
   Unfortunately, There is no specific deadline stated in FIDIC 78 or 92, however, Engineer should complete the determination within a reasonable time and should not delay it.
   Refer to clause 1.5 of Fidic 1992 which states:
   “Wherever in the Contract provision is made for the giving or issue of any notice, consent, approval, certificate or determination by any person, unless otherwise specified such notice, consent, approval, certificate or determination shall be in writing and the words “notify”, “certify” or “determine” shall be construed accordingly. Any such consent, approval, certificate or determination shall not unreasonably be withheld or delayed.”
   ———
   Moreover, the 14 days time frame for the engineer to reply on letters or submittals is not contractual unless it is part of contract documents. Sometimes, the two parties agree on the time frame during the kick-off meetings.
   We advise you follow this link to have more information:
   http://cmguide.org/archives/31
   Regards..
   Samer H Skaik

   

   binucninan Reply:
   June 18th, 2011 at 5:37 pm

   Dear Mr. Samer,

   On a FIDIC 1987 Edition Contract, what recourse does a Main Contractor have in respect of his Performance Guarantee if the Employer has suspended the Works in the project for a prolonged period and payments have also not been made since 1 and 1/2 years.

   Is the Contractor within his contractual rights to demand return of his performance bond because it is just sitting with the bank and incurring bank charges. The Employer has no intention to re start the works any soon and the bond is actually exposing the Contractor financially. Being a semi government entity, the Contractor does not want to pursue the termination option available under the Contract.

   Kindly advise.

   Regards
   Ninan

   

   Samer H Skaik Reply:
   July 1st, 2011 at 11:24 am

   Dear Ninan

   The only contractual way is to terminate the contract and notify the bank accordingly. You need to get a court order to freeze the performance bond with the bank as some Employers liquidate it once they feel that dispute will arise.

2. Naszer Says:
   February 15th, 2009 at 10:57 am

   Dear Sirs,

   Thank You very much for the prompt response provided for my query and I remain Thankful to you always.

   Furhter I would to ask one more question as:

   In the same Contract (Fidic 87/92)

   If the Main Contractor wishes to remove one of his Subcontractor and the Main Contractor undertooks the remaining Works to do by himself. The Sub Contracted Works is the MEP Works.

   Could you kindly claryfy, if any contractual issues to be covered or considered or noticed from the part of the Engineer as well as from the Employer, while the Contractor changing/removing this subcontractor?

   Thanks and Regards

   

   Samer Skaik Reply:
   July 1st, 2009 at 4:16 pm

   Hello Naszer,
   Firstly, you need to examine your MEP subcontract agreement for termination clause. Usually, it should go into strict procedure prior to be contractually effective.
   Secondly, You are not allowed to carry any works on site on behalf of your specialist subcontractor without prior consent of the Engineer.
   I refer you to clause 4.1 of FIDIC 1992, where it states the following:
   The Contractor shall not subcontract the whole of the Works. Except where otherwise provided by the Contract, the Contractor shall not subcontract any part of the Works without the prior consent of the Engineer. Any such consent shall not relieve the Contractor from any liability or obligation under the Contract and he shall be responsible for the acts, defaults and neglects of any Subcontractor, his agents, servants or workmen as fully as if they were the acts, defaults or neglects of the Contractor, his agents, servants or workmen.
   Provided that the Contractor shall not be required to obtain such consent for:
   (a) the provision of labour, or
   (b) the purchase of materials which are in accordance with the standards specified in the Contract, or
   (c) the subcontracting of any part of the Works for which the Subcontractor is named in the Contract.
   I trust the above clarify the issue..
   Regards,
   Samer H Skaik

   

   Mohamed Shafik Reply:
   December 22nd, 2009 at 5:23 pm

   Dear Sir,

   Allow me to express a different interpretation.

   Based on the Subclause you referred to (4.1), it dealt only with conditions regarding how the Main Contractor should subcontract works, but nothing in the clause prevented the Contractor from undertaking the Works of any of his Subcontractors by himself unless he obtains the consent of the Engineer, it only specified that the Main Contractor should obtain the said consent when subcontracting.

   Can you kindly clarify on which part of Subclause 4.1 you based your advice (or if there is another clause we should be referred to)

   Thank you for your help

   

   Construction Management Guide Reply:
   December 22nd, 2009 at 8:56 pm

   Dear Mohammad,

   I really thank you for your valuable opinion.
   I based my opinion from my understanding that this specialist subcontractor is named in the contract. Accordingly, the statement given up is correct since the tender price has considered the appointment of this subcontractor and prior consent is required to do the work on his behalf to verify the quality measures.

   However, your opinion is still valid and correct if the subcontractor is neither named nor nominated.

   Thanks alot.

3. DORIAN A. ANSARI Says:
   April 9th, 2009 at 3:46 pm

   I am Employer and am in process of suspending and later terminating my Consultant. Contract is based on fidic. What pros and cons I shall be facing?

   1- is it possible I will get all the work done by consultant? which I ofcourse paid for?
   2- Am I obligated to pay him extra?

   Please advise

   Dorian

   

   Samer Skaik Reply:
   October 8th, 2009 at 8:53 am

   This answer is received from our consultant Mr. Rey Madrono

   Dear Dorian:
   The premise of your query appears to us that you are dissatisfied with the services of your consultant, that reason of which you have not indicated that would have guided us to profound on our advise.
   Suspending the contract with your consultant and terminating him later, if this is your intention, may not be the best idea unless you have a valid reason that is legally sustainable not only under the FIDIC clauses but also under the prevailing law, the Civil Code of UAE.
   Suspending a contract in the guise of termination, especially if suspension exceeds 56 days pursuant to Sub-Clause 27.1 of the FIDIC White Book creates an implied termination of contract under the Civil Code. This manner of “termination” exposes the employer to possible compensatory and other forms of damages because the law creates a presumption of “bad faith” on the employer. Remember that FIDIC types of contract are what we lawyers consider as “Adhesion” contracts under the Civil Code for which clauses thereof are generally construed against the employer.
   View that the only ground for termination under Sub-Clause 27.1 is when the consultant is “not discharging his obligations” under the contract. However, as in any forms of contracts regulated by law, other grounds for termination by any party, such as culpable delay, do exists under the Civil Code of UAE. However, in the absence of sufficient facts conveyed by your query, we cannot expound on this matter any further.
   From the business and practical point of view, it is generally ill advised to terminate a consulting services midstream into the works of the consultant since this will entail re-execution of the works by another consultant resulting in further delays and additional costs, unless of course the consultant is really incompetent to do the works and perform its deliverables. If such is the case, you terminate the services with damages against him for breach of contract.
   A new consultant will have to redo or re-execute the works from the start to forestall any possible copyright infringement and, which is most important, to obviate its decennial liability as “design engineer” under the provisions of the Civil Code.
   The possiblity of getting all the work done by the same consultant will depend on how you get him into performing his tasks within the parameters of your agreement. It appears to us that you may have to grant him additional time for this purpose.
   Your obligation to “pay extra” upon termination of services (assuming this is what your query means) will depend on the grounds of termination. Generally, however, any necessary work or expense incurred by the consultant is regarded as “exceptional services” pursuant to Clause 28 of the FIDIC White Book and entitles the consultant to “extra” payment. Such extra payment, furthermore, may be tempered with any delay penalty imposable against the consultant assuming a penalty clause is provided under the particular conditions of your consultancy agreement.

   Rey Madrono

   

   MG Reply:
   November 9th, 2009 at 2:00 pm

   What about if the Termination for Employer’s own convinience is allowed in particular conditions?

   Is such termination recognised by UAE law?

   

   Construction Management Guide Reply:
   November 9th, 2009 at 10:52 pm

   Dear MG,
   This issue is under debate. I quote here a wonderful answer from an article published before in CMGUIDE:

   “For muqawala (contracts of work), civil code articles 892 to 896 set out the legal framework, with article 892 stating: ‘A contract of muqawala shall terminate upon the completion of the work agreed or upon cancellation of the contract by consent or by order of the court.’

   Within the general provisions on contracts, article 267 states: ‘If the contract is valid and binding, it shall not be permissible for either of the contracting parties to resile from it, nor to vary or rescind it, save by mutual consent or an order of the court, or under a provision of the law.’

   The requirement for ‘mutual consent’ raises issues as to whether an agreed termination for convenience clause in a signed contract would in itself be accepted as that required element of ‘mutual consent’. Article 218(1) states that a contract will not be binding (despite its validity and effectiveness otherwise) if there is a condition allowing one party to cancel the contract without mutual consent or an order of the court.”

   http://cmguide.org/archives/20

   You can also refer to this link for better understanding:
   http://www.tamimi.com/files/articles/Construction/Coping_With_Terminatin_Aug08.pdf

   Regards..

   Samer Skaik

4. ayham Says:
   April 12th, 2009 at 1:40 am

   I have this case, because of payment issues between the engineers and employee the engineer DENIED to make any inspection for more 12 days,, how I can support my claim
   Thanks

   

   Samer Skaik Reply:
   July 1st, 2009 at 4:16 pm

   Dear Ayham,
   most types of contracts provides contractual entitlement for such cases in favor of contractors.
   According to Fidic 1992, clause no. 44.1 (d) states that in the event of any delay, impediment or prevention by the Employer, the contractor will be entitled for extention of time. The Engineer negligence is alway considered within the responsibility of the client who appointed him.
   Also, you may refer to clause 6.3 and 6.4 regarding diruption of work which should be followed to support your entilement for time and cost. I list below the relevant clauses for your reference..
   6.3 Disruption of Progress
   The Contractor shall give notice to the Engineer, with a copy to the Employer, whenever planning or execution of the Works is likely to be delayed, or disrupted unless any further drawing or instruction is issued by the Engineer within a reasonable time. The notice shall include details of the drawing or instruction required and of why and by when it is required and of any delay or disruption likely to be suffered if it is late.
   6.4 Delays and Cost of Delay of Drawings
   If, by reason of any failure or inability of the Engineer to issue, within a time reasonable in all the circumstances, any drawing or instruction for which notice has been given by the Contractor in accordance with Sub-Clause 6.3, the Contractor suffers delay and/or incurs costs then the Engineer shall, after due consultation with the Employer and the Contractor, determine:
   (a) any extension of time to which the Contractor is entitled under Clause 44, and
   (b) the amount of such costs, which shall be added to the Contract Price,
   and shall notify the Contractor accordingly, with a copy to the Employer.
   Regards,
   Samer Skaik

5. ayham Says:
   April 12th, 2009 at 9:18 pm

   Dear Samer
   thank a lot for you answer ,
   can i refer same to the FIDIC-1987 4th Edition

   thank

   

   Samer Skaik Reply:
   July 1st, 2009 at 4:17 pm

   Yes Ayham,
   Fidic 1992 is an ammendment of Fidic 1987 and doesn’t have big difference..
   Good Luck

6. ayham Says:
   April 16th, 2009 at 11:36 pm

   Dear Sir
   How I can support a claim from the FIDIC-1987 4th Edition , and 1992 is these 4 case
   1- The engineer not retains or delays the inspection after 24 hours of the submittal the inspection?
   2- Delay the RFI more than 14 days as it mention in the contract?
   3- If the contract between the employee and the engineer effect the progress in the site as example ” this case the contract for MEP work with the employee is a part time max for 2 days and for a civil work mention as usually for 6 days a week 8 hours per day and the contractor contract is also 6 days a week 8 hours per day” how I can claim for this case?
   4- The change for the drawing?
   I am looking forward for your answer for these 4 cases with thanks

   

   Samer Skaik Reply:
   July 1st, 2009 at 4:17 pm

   Hello Ayham,
   For Q1, Q2 and Q3, you just need to know that the Engineer should not delay or hold the approval unreasonably. Refer to clause 1.5. FIDIC is silent about the timeframe for that, so you need to check your contract documents if it states so and act accordingly.
   for Q4, briefly, you need to examine the nature of changes. Refer to clause 51.1 to see if such change constitutes a variation or not. If yes, you need to notify the Engineer of that variation pursuant to clause 53.1 and ask for formal variation order prior to proceed.
   Further, you need to see if such variation will prolong the project date for completion or not. You can refer to clause 44.1 to support your claim for extension of time.
   Regards
   Samer Skaik

7. Felicia Cheah Says:
   June 25th, 2009 at 11:11 am

   Felicia Cheah Says: Your comment is awaiting moderation.
   June 25th, 2009 at 11:08 am

   Dear Sir,
   Correct me if I am wrong. My experience under PAM (Malaysia) condition of contract is – when employer defaults in payment, the main contractor has no other alternative except to terminate the contract. At times, the main contractor wishes to continue with the intention is to slow down, however, the main contractor should not STOP WORK, with the slow down action, the main contractor received instruction from the SO that work progress is slow and may not give extension of time. On such situation, what is the better action to take since the Employer is still at the upper hand of not paying yet not allow to slow down not to mention stop work ?

   

   Rey Madrono Reply:
   July 1st, 2009 at 4:19 pm

   Hi Cheah:
   PAM (short for Pertubuhan Akitek Malaysia or Organization of Architects, Malaysia) Conditions Contract is commonly used in private construction while the PWD Conditions of Contracts applies over Government projects. Both contracts, including similar contract Forms (FIDIC, JBC, AAA, etc) are subject to the provisions of Contracts Act of 1950 (Act 136, Revised 1974). We note that the provisions under the Contracts Act are similar to clauses on “Obligations & Contracts” that one will ordinarily find under most Civil Codes.
   Going now to your query, we hereby reproduce Clause 52 and Clause 55 of the Contracts Act of Malaysia which states that:
   ‎”52. When a contract consists of reciprocal promises to be simultaneously performed, no promisor ‎need perform his promise unless the promisee is ready and willing to perform his reciprocal promise.”.
   “‎55. When a contract consists of reciprocal promises, such that one of them cannot be performed, or ‎that its performance cannot be claimed till the other has been performed, and the promisor of the ‎promise last mentioned fails to perform it, the promisor cannot claim the performance of the reciprocal ‎promise, and must make compensation to the other party to the contract for any loss which the other ‎party may sustain by the non-performance of the contract.”
   Construction contracts involve reciprocal obligations in the sence that the Employer is obliged to pay the Contractor, and the latter is reciprocally obliged to execute the Works. If one party defaults in the performance of his reciprocal obligation, the juridical tie is severed pursuant to the provisions of Clause 52 and 55 of the Contracts Act and the Contractor has all the right to stop the work. The Employer CANNOT sue for specific performance because he is guilty of “prior breach”, and can even be sued for general damages by the Contractor for such breach.
   Slowing down his construction activity is a prerogative of an “unpaid” contractor notwithstanding any contract provision preventing such recourse. Threatening the contractor with non-extension of time in case of delay is an exercise in futility and will not prosper under Act 136 of 1950 because the “proximate” cause of the delay was the default of the Employer.
   The better action in case of breach of the employer to pay the contractor his payment certificates under the Contracts Act (never mind the agreement because clauses are generally favorable to the Employer)is, sadly, to invoke Clauase 52 or 55 of the law and STOP the works. This will compel the Employer to pay, and any delay occasioned by the stoppage cannot be taken against the contractor because it is the law that affords him the right to take such extreme measure. (Dura lex sid lex- the law maybe harse but it is the law

   

   Felicia Cheah Reply:
   July 1st, 2009 at 4:19 pm

   THANK YOU VERY VERY MUCH. IT IS INDEED A MAJOR DECISION TO CROSS
   THE LIMIT TO STOP OR SETTLE AMICABLY VIA MUTUAL TERMINATION.
   REGARDS

8. Rana B. Anastas Says:
   July 1st, 2009 at 5:12 pm

   As our contract is based on FIDIC 1987/92 (foruth Edition) Contract Conditions; would appreciat your feedback with regards to the following:

   As a main contractor, we received instructions pretaining to a various number of variations which have not only cost but time impact. On that basis, we have submitted an extension of Time claim of which we are still awaiting response to.

   In the meantime, the consutlant/client is requesting a reduction in the agreed percentage monthly rate of our prelims specified within our contract.

   My questionis this:
   Is the consutlant / Employer within his contracutal right to reduce the percentage rate of prelims within our monthly payments, while the extension of Time claim is still in affect?

   

   Samer Skaik Reply:
   July 1st, 2009 at 5:16 pm

   Hi Rana,
   To answer you precisely, please clarify the following:
   - Type of contract (Lump sum or remeasured)
   - The prelims have detailed break down in BOQ or not?
   - When you have submitted your claim and what is the original date for completion?
   Regards,
   Samer

9. Rana B. Anastas Says:
   July 1st, 2009 at 5:35 pm

   Dear Samer,

   Theseare the responses to your queries:

   - Contract type is Lump Sum
   - The prelims are only itemized as unit rates within BOQ. However, a detailed distribuition of Prelims throught the contract duration was subsequently submitted and approved by consutlant.
   - The claim was submitted in Mid February-2009 and original date of completion is November 08th, 2009.

   Regards,
   Rana

   

   Samer Skaik Reply:
   July 2nd, 2009 at 9:13 am

   Dear Rana,

   The Engineer has the right to reduce the percentage of prelims for the work done in your interim payments if -and only if- the actual percentage seems to him less that what you have claimed.

   Relating such reduction to your EOT claim is totally irrelevant, since your prolongation cost will be dealt separately and added to the revised contract value. You will be entitled for the full amount of prelims as stated in your BOQ in addition to any prolongation cost resulting from EOT claim.

   Some times, the Engineer may find out that the unit rate of an item in prelims is exaggerated, therefore, he has the right to fix a rate that he believes it is fair and appropriate which is contractually sound.

   I wish I understood your question properly and my answer will satisfy your question..

   Don’t hesitate to contact us for any further clarification.

   Samer

10. Engineer Asif Jamil Says:
    July 11th, 2009 at 1:14 pm

    Dear Sir,
    I have one lumpsum contract with the following dates.
    Start date 7th October 2007
    Finish Date 22nd June 2008
    Approved EOT 207 Days (approved by consultant)
    In our BOQ we don’t have breakdown for priliminaries, we have mentioned the items but not the unit price, for all priliminaries items we have mentioned lumpsum amount say 1.6 million.
    but during construction period Engineer/consultant asked for detailed breakdown of preliminaries so we the contractor provided them detailed breakdown for preliminaries and he approved during construction period.
    Now my questions are as under:
    1. for prolongation claim will Engineer consider breakdown of preliminaries which we have provided them(if yes please tell me clause of FIDIC 1987)
    2. in preliminaries section we have not consider our head office overhead, in that can we claim for overhead please reply me as per FIDIC clauses

    regards

    

    Samer Skaik Reply:
    July 12th, 2009 at 8:45 am

    Dear Asif Jamil,
    I assume that the EOT you got entitles you for the relevant prolongation cost. However, I need to know the reason of the EOT to help you better with my references. For example, if the EOT is issued because the Engineer or Employer has delayed in issuing you the drawings, then you need to refer to clause 6.4 which says:

    Delays and Cost of Delay of Drawings

    If, by reason of any failure or inability of the Engineer to issue, within a time reasonable in all the circumstances, any drawing or instruction for which notice has been given by the Contractor in accordance with Sub-Clause 6.3, the Contractor suffers delay and/or incurs costs then the Engineer shall, after due consultation with the Employer and the Contractor, determine:

    (a) any extension of time to which the Contractor is entitled under Clause 44, and

    (b) the amount of such costs, which shall be added to the Contract Price,

    and shall notify the Contractor accordingly, with a copy to the Employer.

    This clause will give you the entitlement to claim the prolongation cost. The actual cost will only be considered here including site overheads, head office overheads, s/c claims, financial charges etc…

    Now refer to clause (1) of cost definition which is very clear regarding inclusions of such costs in the contract:

    (g)(i) ”cost” means all expenditure properly incurred or to be incurred, whether on or off the Site, including overhead and other charges properly allocable thereto but does not include any allowance for profit.

    However, the Engineer -who should be impartial party- has the right to fix the rate which he believes it is appropriate and reasonable unless you can verify how it was derived by the available contemporary records, invoices, site diary records etc…

    Trusting my answer will be to your satisfactory.

    Thanks and Regards..

    Samer

    

    Asif Jamil Reply:
    July 12th, 2009 at 9:49 am

    Dear Sir,
    still i m confused just tell me the following

    for prolongation claim will we take recurrent items and rates from our BOQ(i.e. preliminaries) or there is no link between prolongation claim and preliminaries in BOQ OR there is no hard and fast rule and it is only the Engineer right that procedure he follows.

    

    Samer Skaik Reply:
    July 12th, 2009 at 10:33 am

    BOQ rates can only be used if the rates are applicable, appropriate and reasonable. Refer to clause 52.1 for evaluation of variations for example in which the concept is clear and can be used as a reference for prolongation cost determintation.
    To sum up, your claim calculation should be reasonable and justified, to have a strong case, however the Engineer still have the power to fix rates if in his opinion it seems inappropriate or inapplicable. Refer to clause 52.2 for further details.

11. Munir Anwar Says:
    July 14th, 2009 at 1:36 pm

    Dear Sir,
    My Project detail is as under: –
    Country = Pakistan
    Date of Commencement = 25th of Sep, 2005
    Date of Completion = 25th of Sep, 2010
    Completion Duration = 05 Years
    Contract Based on = FIDIC – 1978
    Nature of Work = Contract of Civil work (Roads, Bridges, Rail & Road Tunnel)
    The progress of work is suspended due to Law & order and security reasons in the project area, project is suspended in two steps:
    1) From 08 May 2009 to 31 May 2009 was suspended by the Engineer under clause 20.4 (a), (b) & (e) (Employer’s Risks) and clause 20.5 (Force Majeure) and applying the clauses 65.2, 65.6, 20.1 & 54.2.
    2) From 01 June 2009 to 30 July 2009 is suspended by the Engineer under clauses 40.1, 20.4, 20.5, 40.3 & 65.2.
    The Total project is suspended for 84 days.
    Now, my question/problem is that, Contractor is submitted the Claim against suspension of progress of work (from 08 May to 31 May – 2009, (First suspension)), that includes the Idle Machinery (Clause-54.2) which is now parked Idle at site as directed by the Engineer under clause 54.2.
    CONCLUSION: Dear sir, plz tell me that how i proceed, and what method i will follow for the machinery, bcuz some of the machinery is rented.
    thank you,
    hope for early reply.

    

    Kumar Reply:
    July 16th, 2009 at 4:20 pm

    Your question is not clear. However, I have very simple answer, see whether it fits for you.

    The cOntractor should submit the rental charges for the machinery and the same amount will be entitled by the Contractor for the suspended period. If idle, no fuel charges will not come.

    

    Samer Skaik Reply:
    July 19th, 2009 at 8:41 pm

    Dear Munir,
    You have two issues here. Firstly, you need to submit your extension of time claim to present your case. As per the given reasons of delays, you will entitled for the prolongation cost resulting from the extension of time. You need to claim for actual costs and damages incurred with all relevant substantiations such as invoices, quotations, etc…
    Secondly, as part of your obligations under the contract, you have to mitigate the damages and expenses that would result from the act or in-act of the Employer. With regard to machinery for example, you need to study if you can send the machinery to other running project or stop its rent and the Employer should be aware of your mitigation measures. however, you will be entitled for any loss or damage such as machinery rental, fuel consumption, security, etc.. in addition to any other running cost.

    Regards..

12. Kumar Says:
    July 14th, 2009 at 2:31 pm

    Dear Sirs,

    I am working in Dubai for a Contractor for a project consisitng several buildings.

    Before completing the testing and commission, the Employer rented the flats of some of the buildings. Civil works almost completed but MEP testing and commission and some other defects are being carried out. My questing is as follows.

    1) We have demanded the TOC under the clause 48.2(c) of FIDIC 1987. However, Consultant refused to issue TOC as stating that the testing and commision for any building should complete before issuing the TOC. is this decision correct?

    2) Employer said that they will enforce the Liquidated damages for the period from Time for Completion and the date in TOC. In that case, they are going to put LAD even for the period of employer getting beneficial occupation. Is this correct?

    3) Can we demand at least the TOC for completed civil works excluding MEP works of any one buildings which is outstanding?

    I wish that I will get a comprehensive reply for this qestion as soon as possible.

    

    Samer Skaik Reply:
    July 19th, 2009 at 9:03 pm

    Dear Kumar,

    Here we refer to clauses 48.2 and 48.3 of FIDIC 1987:

    48.2

    Similarly, in accordance with the procedure set out in Sub-Clause 48.1, the Contractor may request and the Engineer shall issue a Taking-Over Certificate in respect of:

    (a) any Section in respect of which a separate Time for Completion is provided in the Appendix to Tender, or

    (b) any substantial part of the Permanent Works which has been both completed to the satisfaction of the Engineer and, otherwise than as provided for in the Contract, occupied or used by the Employer, or

    (c) any part of the Permanent Works which the Employer has elected to occupy or use prior to completion (where such prior occupation or use is not provided for in the Contract or has not been agreed by the Contractor as a temporary measure).

    48.3

    If any part of the Permanent Works has been substantially completed and has satisfactorily passed any Tests on Completion prescribed by the Contract, the Engineer may issue a Taking-Over Certificate in respect of that part of the Permanent Works before completion of the whole of the Works and, upon the issue of such Certificate, the Contractor shall be deemed to have undertaken to complete with due expedition any outstanding work in that part of the Permanent Works during the Defects Liability Period.

    Now let us see your questions in light of the above clauses:

    1) Occupation of part of work by the client should be done in good faith. The engineer has no right to prevent issuance of partial TOC based on clause 48.2 c. You can prevent the Employer to access the units till such TOC is issued. The current situation is neither contractual nor legal. Yuo need to consider the insurance related issues here as well since the client is not covered in your CAR insurance and he should have his own.

    2) This is neither contractual nor legal. Employer can’t posses as part of work without prior issuance of TOC by the Engineer. Legally, you can sue the Employer on the bases of absence of good faith which is the spirit of any contract.

    3) You can’t claim for TOC for any part of work if it is not subtantitally completed and the tests stated in the contract are not conducted. Contract is clear in this regard.

    My advice to you is to use your negotiation skills with your difficult Employer to reach into a fair settlement or suggest a mediator to resolve such conflict.

    Regards..

13. Munir Anwar Says:
    July 20th, 2009 at 10:35 am

    Dear Sirs,
    thanks for reply, but still some confusion, i am working with Consultant (Engineer). the question is that, without the machinery rent, Contractor is entitled to claim other charges i.e. staff salaries etc. if Contractor is entiltled or not, give the clause references.
    regards,

    

    Samer Skaik Reply:
    July 21st, 2009 at 8:47 am

    Dear Munir,
    you need to examine the cause and effect of any delay case by case to identify whether the contractor is entitled for prolongation cost or not. For example, suspension clause 40.2 b states the following:

    40.2 Engineer’s Determination following Suspension

    Where, pursuant to Sub-Clause 40.1, this Sub-Clause applies the Engineer shall, after due consultation with the Employer and the Contractor, determine:

    (a) any extension of time to which the Contractor is entitled under Clause 44, and

    (b) the amount, which shall be added to the Contract Price, in respect of the cost incurred by the Contractor by reason of such suspension, and shall notify the Contractor accordingly, with a copy to the Employer.

    So, the contractor will be entitled for compensation against any loss or damage incurred due to such suspension such as staff salaries, site office rentals, electricity, idle manpower, head office over head, subcontractors claims, etc…
    Refer to the definition of the term “cost” in FIDIC for more information..

    Regards,

14. Iqbal KHAN Says:
    July 20th, 2009 at 1:48 pm

    Sirs
    I am working as Resident Engineer on road project in Pakistan. Before ask my question, let me explain the issue at present I am facing.
    The contractor who was the lowest for my project put a rebate on the entire BOQ items (8%) and the work was allotted to him. The Client due to some reason, replaced asphaltic base and wearing course (BOQ Item) with Bit Mac (Non BOQ) and now the same will be executed at site and the Variation Order now in process. The problem with is that: Shall I aplly rebate to the new item or not?
    Client is of the opinion that, this new item of Bit Mac is now part of BOQ and Rebate + Escalation will be applicable. While Contractor is demanding that as this is non BOQ item and the rebate shall only be applied on BOQ items.
    Is there any Clause or any other history in FIDIC or some where else to help me finalize the Variation Order? What shall I do?
    Thanks in advance.

    

    Samer Skaik Reply:
    July 21st, 2009 at 8:59 am

    Dear Iqbal,
    the BOQ rate can only be referred to if it is appropriate and applicable. You need to read clause 52.2 thoroughly to understand the terminology of certifying the variations.
    In your case, I assume that the variation was initiated by the Engineer/Employer side. The BOQ rate with the associated rebate is used as a basis as applicable and reasonable. you can’t impose it if the contractor will lose money to perform variation works. However, to ensure value for money, you need to examine the new rate claimed by the contractor and compare the same with market prices. if matching, then it is wise to certify him accordingly.

    Regards..

15. andrew matambo Says:
    July 21st, 2009 at 3:12 pm

    In our country, most locally owned building contractors do not grow as compared to the foreign owned. I want to know how building contractors grow and keep their capbilty without going into liquidation or insolvency.

    

    Samer Skaik Reply:
    August 11th, 2009 at 8:59 am

    Hi Andrew,
    This depends onn many factors such as:
    - The market strength and stability.
    - Implementing strategic management in contracting organisations such as diversity and new products.
    - Outstanding top management skills.
    - Strong human resources.

    Regards,

16. Noel Castillo Says:
    July 23rd, 2009 at 1:26 am

    Dear Sir,

    Subject: Determine How Many Projects One Project Manager Can Manage

    I manage projects from beginning trough end of construction. We manage the planning, design, ROW phase, construction phase etc… I was curious if the 15% of hours of effort would apply. What hours of effort do I use to multiply by 15%? Do I utilize only the construction hours of effort to determine how many hours of project management we will need for the life of the project?

    Please advise.

    Noel

    

    Samer Skaik Reply:
    August 11th, 2009 at 9:00 am

    Hi Noel,
    Please refer to this article. You will find the answer there.
    http://cmguide.org/archives/1317

17. Felicia Cheah Says:
    July 29th, 2009 at 1:12 pm

    Dear Sir,

    Of late, we are prospecting a sea reclamation project for refinery oil & gas, shoplots, housing estate. May I have your kind opinion that :-

    a) which form of contract is best recommended (self-funding, non-government project however Government approval’s needed) ? FIDIC, PAM, etc ?

    b) may I have any reference on this nature of project – ie. methods, design etc ?

    c) the design warranty part in particular, who should shoulder such ?

    d) Thank you very much. Regards

    Felicia Cheah

    

    Samer Skaik Reply:
    August 11th, 2009 at 8:55 am

    Dear Felicia,
    FIDIC has many forms of contracts that can be suitable for different works such as civil works and M& E works. Please refer to this:
    http://www1.fidic.org/bookshop/

    For the interest of the project, you need to choose a contract form that you and the contractor are familiar with to avoid conflicts and ambiguities.

    Regards,,

18. Nasair Says:
    August 8th, 2009 at 10:47 pm

    I have a lump sum project based on Fidic 87; there are a lot of variations in this contract.
    The question.

    Is the client and the consultant entitle to deduct the recovery percentage of the advanced payment for both the original items and the V.O
    Thank you

    

    Samer Skaik Reply:
    August 11th, 2009 at 8:51 am

    Dear Nasair,
    In principle, Recovery of advance payment should be from the original scope of work which forms the contract price. it will not work if deduction will include variation works, since the recovery at the end will be more that obtained.

    However, check your contract and see if there is clear clause in this regard since FIDIC doesn’t mention such procedures.

    Regards..

19. Imran Says:
    August 11th, 2009 at 1:34 pm

    What action should be taken by the Engineer pertaining to “Insurances” in case the contractor delays the compltion of works under FIDIC Form of Contract?

    

    Samer Skaik Reply:
    August 13th, 2009 at 11:33 am

    Hi Imran,
    Your question is not clear. Do you mean liquidated damages or performance bond?

20. Nasair Says:
    August 13th, 2009 at 5:24 pm

    Dear Sir,

    I Know that FIDIC is a re measurement contract however a lot of lump sum projects depend on FIDIC without changing any clauses.
    Kindly clarify what are the clauses which it should be changed and what are the problems might be happen in case of no changing to the FIDIC clauses And using it as it is as a general condition.

    Regards

    

    Samer Skaik Reply:
    August 16th, 2009 at 9:03 am

    Hello Nasair,
    Generally, In any contract, there will be general conditions such as FIDIC and particular conditions that will supercede, add, delete or revise some clauses of FIDIC. To make the FIDIC 87 as a lump sum contract, you need only to delete the clause no. 55 and 56. In particular conditions, you need to include a new clause stating that the contract is a lump sum fixed price contract and is not subject to remeasurement.

    

    mohamad Reply:
    February 26th, 2011 at 5:33 pm

    Hi Samer,

    What about clause 52.3 how should this be modified for a lump sum contract. In remeasured contract if the quantities int he B.O.Q are exceeded you get paid for it however in a lump sum you dont it is your risk. Hence it is only logical that if you have any negative variation you should retain the OH & P to balance the risk.

21. Ken Says:
    August 13th, 2009 at 6:25 pm

    I’m a subcontractor on a job and purchased material for the project. At the time I signed the contract I thought I would have no problem securing the required performance bond. The bonding company is giving me a difficult time and I’m wondering what kind of options I have with the GC and Developer. Like I said I already have the material in my warehouse. The developer has mentioned something called a CPC form. I’m not sure if that is correct. But my understading is that it would give him possesion of the material once they’ve paid for it even if it was in my warehouse. If this was done, then they might lift the bond requirement. Does anyone know where I can find this form? Or what other options are open to me?

    

    Samer Skaik Reply:
    August 16th, 2009 at 9:23 am

    Hi Ken,
    Regarding CPC forms, you can search via the web to find the form or ask the employer to send it to you.

    Alternatively, you can negotiate other options with the employer. You can offer an open dated security cheque instead of performance bond or to get the first payment upon the delivery of materials site.

22. DAN Says:
    August 20th, 2009 at 9:40 am

    Hi,

    A project has being executed under design-build contract (FIDIC form of contract). The Government introduced new toll gates for some particular roads inside the city but that some how affecting the project. There are some other alternate roads available, so that that toll can be avoided. The Contractor is claiming that this new toll gates is affecting the project cost (Claim placed under particular clause – changes in legislation). Did the Contractor entitle in this case? How about the G.C.Clause 26.1 Please advise.

    

    Samer Skaik Reply:
    August 26th, 2009 at 12:54 pm

    Hi Dan,
    Firstly, you need to check the particular conditions of contract since legislation clause no. 70.2 is usually revised to be in favor of Employer. However, if it is not, the case should be studied carefully. If the introduction of the new toll gates took place after the date 28 days prior to the latest date for submission of tenders by the contractor, the contractor would be obviously entitled for all costs resulting from such event pusuant to clause 70.2.

    Clause 26.1 is only applicable for laws, legislations and policies that were considered or supposed to be considered by the contractor before the date 28 days prior to the latest date for submission of tenders.

    Regards.

23. Nasair Says:
    August 20th, 2009 at 7:51 pm

    Hi,

    I have an item in BOQ which is Provisional sum
    , please clarify the procedures of implementing provisional sum items?
    The client or the engineer should request from the contractor to implement the item or not
    What is the meaning of the price mentioned in front of provisional sum items.

    Regards

    

    Samer Skaik Reply:
    August 26th, 2009 at 1:02 pm

    Hi Nasair,
    I assume that you are dealing with FIDIC type of contracts. To understand the nature of provisional sums and how we deal with them in light of FIDIC 1987, refer to clause 58:

    58.1 Definition of ”Provisional Sum”

    “Provisional Sum” means a sum included in the Contract and so designated in the Bill of Quantities for the execution of any part of the Works or for the supply of goods, materials, Plant or services, or for contingencies, which sum may be used, in whole or in part, or not at all, on the instructions of the Engineer. The Contractor shall be entitled to only such amounts in respect of the work, supply or contingencies to which such Provisional Sums relate as the Engineer shall determine in accordance with this Clause. The Engineer shall notify the Contractor of any determination made under this Sub-Clause, with a copy to the Employer.

    58.2 Use of Provisional Sums

    In respect of every Provisional Sum the Engineer shall have authority to issue instructions for the execution of work or for the supply of goods, materials, Plant or services by:

    (a) the Contractor, in which case the Contractor shall be entitled to an amount equal to the value thereof determined in accordance with Clause 52,

    (b) a nominated Subcontractor, as hereinafter defined, in which case the sum to be paid to the Contractor therefor shall be determined and paid in accordance with Sub-Clause 59.4.

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

24. Sam Says:
    August 22nd, 2009 at 10:00 am

    Hi, My query is related to the performance bond.

    What are the procedures to liquidate a bond and the prerequisites that are required to be followed for it under the civil code of UAE. The supplier failed to perform his obligations within the time limit specified in the bond. Is a timely notice a condition precedent for liquidation, regardless of the ‘unconditional’ terms and conditions of the Bond. From where can i obtain the civil code of UAE?
    Please advice.

    

    Samer Skaik Reply:
    August 26th, 2009 at 1:24 pm

    Hi Sam,
    I refer you to a useful article in CMGUIDE at:
    http://cmguide.org/archives/1438

    Particulary, I quote this section as an answer to your question:

    It is common practice for contractors to provide contractual security to an employer to guarantee its performance under the contract.

    Typically in the UAE, an employer would require the contractor to furnish an unconditional (on demand) bond to be issued by a reputable bank. Generally the terms of an unconditional on demand bonds are designed such that the bank will have to pay to the employers upon its demand without the need for the employer to prove that the contractor has defaulted or is in breach of its obligations under the contract.

    In circumstances where an employer (as sub developer) may face serious issues of liquidity, it may very well be the case that the demand made by the employer was not bona fide but with the ulterior motive of cashing on whatever funds that is readily available for its disposal. Another possible scenario in which an employer may call upon a performance bond is when the contractor becomes insolvent or bankrupt or is the subject of a company administration or receivership.

    Of course there are repercussions the employer will have to bear if it resorts to calling upon a bond in bad faith. However, in the mean time, the contractor will be out of pocket as the issuing bank may by then have liquidated the fund or property that was pledged to the bank as security for issuance of the bond.

    It is due to such extreme scenarios set out above that we consider contractors should try and negotiate with their employers to include certain conditions precedent before the issuing bank or the surety is obliged to pay. However in light of current market conditions it is highly likely banks will insist on keeping the nature of performance bonds unconditional to improve their security (recourse to funds) in the event of contractor default.

25. Nasair Says:
    August 25th, 2009 at 5:56 pm

    Hi,

    Is the contractor entitled to take materials on sit in his payment even if that not mentioned in his contract.
    I have this case in a lump sum project based on FIDIC 87.

    Thank you

    

    Samer Skaik Reply:
    August 26th, 2009 at 1:28 pm

    Hi Nasair,
    Please refer to clause 60.1 (c) where it shows your entitlement to include the cost of materilas on site in your payment. I enclose it below for your easy reference. However, if appendix to tender states zero percentage, then you will not be entitled to claim.

    60.1 Monthly Statements

    The Contractor shall submit to the Engineer after the end of each month six copies, each signed by the Contractor’s representative approved by the Engineer in accordance with Sub-Clause 15.1, of a statement, in such form as the Engineer may from time to time prescribe, showing the amounts to which the Contractor considers himself to be entitled up to the end of the month in respect of

    (c) the percentage of the invoice value of listed materials, all as stated in the Appendix to Tender, and Plant delivered by the Contractor on the Site for incorporation in the Permanent Works but not incorporated in such Works

26. Anadi Says:
    August 27th, 2009 at 5:43 pm

    Hi Samer Skaik,

    Could you please let me know from where I can obtain a free copy of the FIDIC document i.e.

    The Conditions of Contract (International)
    For Works of Civil Engineeting Construction
    Fourth Ediion – 1987
    Reprinted 1992 with further amendments

    Thanks & Regards

    Anadi

    

    Samer Skaik Reply:
    August 29th, 2009 at 3:41 pm

    Hi Anadi,

    Those documents have copyrights and it is unfortunetely unavailable as free of charge.

27. Nasair Says:
    September 7th, 2009 at 5:05 pm

    Hi Sir,

    I have a lump sum project with some items prime cost based on Fidic 87.
    Do the client has the right to deduct the a mounts for items in BOQ which is not required to be done.

    Regards

    

    Samer Skaik Reply:
    September 8th, 2009 at 1:26 pm

    Hi Nasair,
    The client has the right to omit any item which he sees not required to be done provided that he is not going to do it by himself or appoint others to do it. However, you need to be careful when assessing such omission. For example, if you are requested to remove the wooden doors for example from the scope. the omission will be calculated as follows:
    actual quantity X BOQ rate (if applicable) = omission amount
    This is because BOQ quantities are not the contractual quantities in which you are obliged to fulfill under the contract.

    Regards,

28. David Robinson Says:
    September 24th, 2009 at 11:55 am

    Hi, Can snagging ever be an issue to stop a developer completing and handing over the development.

    In the development I am buying into in Dubai almost all apartments have issues such as broken tiles, badly painted walls dirty ceilings etc. Is there and argument to reject the proposed completion date on this alone.

    People have also been told that their snagging is complete by the developers snagging agent. When they turn up to inspect and find none of the items fixed they informed that these items will be corrected after completion during the Developer Liabilty Period. I have never heard of this DLP, will it cover the full snagging and what if the developer just does not fix the items?

    I would be most grateful for any opinions.

    

    Samer Skaik Reply:
    September 27th, 2009 at 8:45 am

    Hi David,
    This mainly depends on the Contractor’s act with regard to his obligation under the contract towards the Employer. As per FIDIC forms of contracts, if the work is substantitally completed, then the Engineer must issue the taking over certificate upon the request of the contractor. Substantial completion is generally taken to refer to a sufficient degree of completion to enable the Employer to take beneficial use of the works concerned.

    “Defects Liability Period” means the defects liability period which is one year and calculated from the date of substantial completion of the Works certified by the Engineer. This to allow the contractor to complete any snags, outstanding works and remedy any defects.

    Thanks and Regards

    Samer Skaik

29. vijay chhatwal Says:
    September 25th, 2009 at 7:34 pm

    hi
    as per FIDIC contract conditions red book (1987/92)edition, when can engineer give decision without consulting the client ?; and when should he take clients approval ? kindly clarify

    

    Samer Skaik Reply:
    September 27th, 2009 at 8:53 am

    Hi Vijay
    I refer you to clause 2.1 which clarifies this matter:
    ———
    2.1 Engineer’s Duties and Authority

    (a) The Engineer shall carry out the duties specified in the Contract.

    (b) The Engineer may exercise the authority specified in or necessarily to be implied from the Contract, provided, however, that if the Engineer is required, under the terms of his appointment by the Employer, to obtain the specific approval of the Employer before exercising any such authority, particulars of such requirements shall be set out in Part II of these Conditions. Provided further that any requisite approval shall be deemed to have been given by the Employer for any such authority exercised by the Engineer.

    (c) Except as expressly stated in the Contract, the Engineer shall have no authority to relieve the Contractor of any of his obligations under the Contract.
    —–

    You need to refer to the particular conditions to examine if the authority of giving instructions or decisions to the contractor is subject to Employer approval or not. Anyway, the contractor is contractually not obliged to investigate on this issue if he receive an an instruction to vary the work for example. The Engineer would rather be well aware of his obligations and nature of authority under the contract.

    Regards,

    Samer Skaik

30. vijay chhatwal Says:
    September 27th, 2009 at 8:39 pm

    thanks samer
    i’m bit new to FIDIC conditions, i think i’d better go through the red book first and see if my doubts are cleared.
    well anyways thanks for your guidence
    regards

    vijay

31. vijay chhatwal Says:
    September 27th, 2009 at 8:51 pm

    hi sameer
    if ou can help me with one problem…..
    if your company has bagged a project contract, what will the organization structure for contract administration , with function and authorities of each one who will be involved in contract administration?and what will be the methods/techniques that will be used/applied for contract administration and monitoring??
    please if you can explain or any link where i could find the solution…

    regards
    vijay

    

    Samer Skaik Reply:
    September 30th, 2009 at 5:06 pm

    Dear Vijay,
    You can search the web for the duties of contract manager and his suboordinates such as quantity surveyors and commercial managers.
    Regarding contract administration issues, you need to have training to develop your knowledge. for example, I have attended a comprehensevie course since two years that covered the main subjects which were as follows:

    1 Variations and Valuation of “varied work” under FIDIC and similar Forms of Contract. (If there are no Variations, then the administration of a contract is straight forward, but almost all projects are burdened with Variations and if the Contract Administrator is not fully competent in dealing with Variations, then there would be disastrous results. This session provides an exhaustive teaching on everything there is to know about Variations and their valuations).
    2 Provisions in the Contract for Extension of Time and Prolongation Costs. (Delayed project completion has become quite common in the industry. It is the duty of the Contract Administrator to deal with Extension of Time and Prolongation Cost Claims. If he is not fully aware about the entitlements of the parties and how to administrate them, then disputes are unavoidable. This session teaches in detail, on how to identify the entitlements to extension of time and prolongation costs even when such entitlements are not stated in a contract).
    3 Dealing with Concurrent Delays. (It is quite common for a Contractor to have slow progress during the early stages which he can recover during later stages. But at a time when he is late, if the Employer also delayed completion. In such concurrent delay situations, the Contract Administrator should be fully competent in identifying the entitlements of the parties, as the Contracts are usually silent on how to deal with concurrent delays).
    4 Notices, Detailed Particulars and Calculation of Prolongation Costs. (It is not always that a Contractor loses his rights if a notice or detailed particulars are not submitted within the time period stated in the Contract. Therefore, the Contract Administrator should be able to identify the circumstances under which the Contractor would lose its rights. This session also explains the details that should be present in a claim in order to prove the entitlements to Extension of Time and/or Prolongation Costs).
    5 Under-Recoveries and Over-Recoveries under Sub-Clause 52.3. (Under a JCT Form of Contract, the Employers and Consultants always deduct the Contractor’s Overheads priced within the Variations against the Overheads Claimed within Prolongation Costs, where EOT is given for delays due to such Variations, but under FIDIC Form of Contract it is incorrect to make such adjustment. Also if the Effective Final Account is well above the Effective Contract Price, the Contract Administrator should know how to adjust the over-recoveries in favor of the Employer and vice versa.
    6 Use of Formulae for Recover of Overheads (Hudson, Emden, Eichleay, Hank-Laan and Samaratunga). (Often the largest portion of a Prolongation Cost Claim is the Contractor’s Head Office Overheads cost element. The Contract Administrator should be fully aware of what Head Office Overheads are, which parts of such overheads can be claimed, which parts cannot be claimed and most importantly how such overheads could be appointed to the delay period of a project. They should also know why formulae such as Hudson and Emden cannot be used when dealing with a FIDIC Form of Contract).
    7 How to Draft a Contract Agreement. (Without knowing what a contract is, it cannot be administrated. This session explains what a legally binding contract is and provides knowledge on the essential provisions one should draft into a contract. Also deals with drafting Subcontracts. Should the limit of Subcontract penalties be 10% of Subcontract Price of 10% of Contract Price?).
    8 Measurement Principles and CESMM3. (Increasingly CESSM3 is being used to measure Civil Engineering work in Dubai and around the world. Since POW(I) is the more common Standard Method of Measurement, Contract Administrators need to be introduced to CESSM3).
    9 Arbitration and Other Dispute Resolution Techniques. (Before the parties become eligible to refer their disputes to arbitration, their Contract Administrators should follow many procedures in resolving any issues at lower tiers. Contract Administrators should be fully knowledgeable on the multi-tiered dispute resolution process written in contracts. In addition to providing them with such knowledge, this session also explains the step by step arbitration process including a video clip of an arbitration hearing. Also an introduction to Mediation, Conciliation and ADR).
    10 Sound Contract Administration. (How to protect the interests of the Company and its Clients, The What, Who, When and Why of Contract Administration. Also presents The DO’s, the DON’Ts and a code of conduct/ethics for Contract Administrators).

    Regards..

    

    Abdul Reply:
    March 14th, 2010 at 4:04 pm

    Dear Mr. Samer,

    I’m quite interested in the referred training. Thus, I hereby request you to provide me the contact details to enhance/develop my knowledge and skills.

    Thanks for your kind cooperation.

    Regards,

    

    RAVINDRAN Reply:
    January 7th, 2011 at 5:39 pm

    Dear Mr. Samer,

    I also request for the details of the training and the training provider. If you share this , it would benefit lot of aspirants.

    Thansk for your cooperation.

32. abbaslou Says:
    September 28th, 2009 at 2:32 pm

    Hi Dear manager…I’m one of the member of rastar process company in iran wich acting in municipality HSE…I wanna to know how can i get a soft copy of your new HSE plan for municipality…many thank in regards…
    saba abbaslou
    HSE HEAD OFFICE
    This is my cooperate e-mail adress…
    s.abbaslou@rastarco.com

    

    Samer Skaik Reply:
    September 30th, 2009 at 4:58 pm

    Hi Abbaslou,
    You need to approach Dubai Municipality directly. I think that hard copy of HSE is available only costing 100 Dhs.

33. Carlos Says:
    October 7th, 2009 at 10:19 pm

    Would you be so kind to please let me know; under FIDIC 1999 Red book:

    1- in a Lump sum Contract is the Employer entitled to make negative variations for items not required?

    2- can this type of contract be considered as design and build?

    3- what is the weight of the clause 2.4 Employers Financial Arrangements,(the employer provided a document for this, but it was wrongly worded, the Contractor requested the Employer to correct the document and to resubmit it to the Contractor but this never happen and the project is about to be completed, with some delays which could probably trigger LD’s, Question, this requirement was issued as a commercial clarification as a condition to be meet in order to establish the Commencement date for the Works,(these commercial clarification supersede all other documents in the Contract)can this be used to cancel Liquidated Damages because this condition was never satisfied, therfore the commencement date for the works can not be stablished (comencement date still at large), although the schedule marks the commencement of the Works?

    4- Can the Employer interfere with the works with the excuse that we will not be able to finish on time and start doing some of the works themselves and intruding, disturbing and interfering with the works of the Contractor? Does the Emplyer has the right to do this? ( I can not see anything related in the Contract.

    and finally can you please advise if the Employer and the Employer’s representative (not the Engineer) can be the same company? (the Employer created a Company and designated themselfs as Representative of the Employer),(there ia an engineer and an Architec designated by the Employer, so basically the Employer’s representative which is another company is managing the project on behalf of the Employer which is also managing the project, is this a valid structure?

    I am sorry if I am abusing your kindess but I can see that your knowlege is very valuable

    will appreciate very much your prompt and kind response

    Thank you
    Carlos

    

    Samer Skaik Reply:
    October 8th, 2009 at 8:31 am

    Dear Carlos,
    Regarding your query, i would answer in the same order as follows:
    1- In lump sum contracts, Client has the right to omit any work which is indicated on drawings or specifications, or any other document except BOQ, since BOQ in LumpSum contracts is a valid document for rate reference only.
    However, Client doesn’t have the right to omit the work in order to carry it out by him self or by others .
    2- All Fidic forms of contract are re-measured contracts. making it lump sum is through the part II of special conditions of contract. Design and Build contract is known as silver book which is different than FIDIC 1999 Red book.

    3- You need to know that the contract should be always established in good faith. i understood that you have requested the client to submit evidence of his financial standing and he didn’t. In this case, he is in material breach to contract and you have the right to terminate and claim for all damages. However, it is not appropriate nor reasonable to build the case the way you mentioned, as the contractual commencement date was established as mentioned in appendix to tender, unless noted otherwise.

    4- Contract may be silent about this because it is obviously illegal since the property under construction belongs to Contractor only. Client can’t jump in simply to take over the work from the contractor for any reason. Alterntaively, this can be done through mutual agreement or termination of contract under clause 15.2 following contractual procedures.

    5- Client representative should be named in the contract. I don’t see any issue in having the representative inhouse since he should work for the Client interest and is not supposed to be impartial party as the Engineer.

    Thanks and Regards..
    Samer Skaik

34. Carlos Says:
    October 8th, 2009 at 3:39 pm

    Dear Samer,

    Thank you so much for your response it will help me big time,

    there is just one last thing, would you please expand a little more regarding Item # 3 as to what is the actual weight of this clause as it is a new thing on the FIDIC 1999 version, is it valid?
    can be used in an arbitration as a cause for the commencement date being at large because the Employer failure to comply ?

    your response will be greatly appreciated.

    Carlos.

    

    Samer Skaik Reply:
    October 10th, 2009 at 10:44 am

    Dear Carols,
    This is a new provision in Fidic form of contract which aims to protect the Contractor from Employer default in payment and bankruptcy as well. Adopting the clause in your claim seems irrelevant since there was no early notice from your end to the client regarding any action you are going to take due to his failure to fulfill his obligations.

35. Samia Abuzarifa Says:
    October 15th, 2009 at 10:19 am

    We are the Main Contractor. The Employer has a Project Management Company and a Consulting Company.

    An email from the Project Management with copy to the Consulting
    Company has been sent to us asking us to purchase materials which are not included in our original BOQ. Could this email be considered as official instruction?

    

    Construction Management Guide Reply:
    October 15th, 2009 at 11:37 am

    Hi Samia,
    Email is not an official or contractual document unless it is stated in the contract. You can consider this as a verbal instruction and confirm the same by CVI as per clause 2.5 of FIDIC 1987. Doing this will keep your good relations and will not compromise your rights.

    Regards..

    Samer Skaik

36. andrew matambo Says:
    October 19th, 2009 at 4:52 pm

    What does the JCT Form of contract stipulate on the Quantity surveyor or Architect who fails to certify a certificate in time or fails to inspect the defects when the contractor has already corrected them?

    

    Construction Management Guide Reply:
    October 22nd, 2009 at 8:23 am

    Hi Andrew, I have skimmed JCT 05 to check. the contract is silent about specific timeline for the architect to certify or give determination. however, legally speaking, there is an implied term in the contract that it should be based on good faith, which save both parties of the contract. Accordingly, you have the right to claim against any damage caused by unreasonable delay of the architect to certify works.

    Regards,

    Samer Skaik

37. royal Says:
    October 21st, 2009 at 9:43 pm

    Can you give some information about prolongation cost calculation?

    Specifically,
    What can prolongation costs include
    How to Calculate Prolongation Costs
    And how to incorporate inflationary effect in prolongation cost calculation? (Allowance for inflation)

    

    Construction Management Guide Reply:
    October 22nd, 2009 at 8:56 am

    Hi Royal,
    Prolongation cost is an entitlement of the contractor to be compensated against the granted extension of time depending on the cause of the delay. It can be claimed using clause 53.1 of Fidic 1987. It includes all costs and expenses that were incurred by the contractor and his supply chain vendors as a direct or indirect result of the delay.
    contractor can mainly claim site and head office overheads and subcontractors’ claims.
    Calculating site overheads must be as per actual losses and expenses while calculation of head office overheads is done by using one of the famous formulas such as Hudson’ formula or Emden’ formula.

    On the other hand, allowing for inflation in prolongation cost is never easy. You need to prove that you incurred or likely to incur losses as a result of material inflation due to project delay.

    Regards,
    Samer Skaik

38. Javaid Says:
    October 31st, 2009 at 1:31 am

    I want to ask a question regarding ICE conditions of Contract 5th Edition .

    The contractor put construction period in the tender as 18 weeks. He submitted the programme in accordance with clause 14 of the conditions of Contract for 18 weeks. Later on he submitted the programme indicating 10 weeks. The project could not be completed in 10 weeks and delayed by 5 weeks. Although the project is completed within the original contract period of 18 weeks, the contractor is claiming delay of 5 weeks as the programme showing completion period of 10 weeks was approved by us.

    

    Construction Management Guide Reply:
    October 31st, 2009 at 11:51 am

    Hi Javaid,
    You need to look into the contract documents to verify the contractual date for completion. Usually, the contractor is submitting his base line programme for the consent of the Engineer based on the contractual commencement and completion dates stated in the contract.

    Please advise on this to give you an accurate answer.

    

    Javaid Reply:
    October 31st, 2009 at 6:45 pm

    Samer,

    There is no contractual date of completion but the contract period in the Form of Tender is 18 weeks. The project was started on July 20, 2009 and the completion date as per contract period of 18 weeks comes to be 20th November 2009. But contractor submitted programme indicating completion date of 24th September 2009 with contract duration of only 10 week. The contractor could not complete the project on 24th September 2009 and submitted a revised programme with completion date of 24th October 2009. The contractor is claiming for delay of 5 weeks although project is completed within a contract period of 18 weeks. As the contractor submitted a reduced unrealistic programme for completion of project, can he claim for delay when the project is completed within the contract period but delayed from his programme. In my opinion, the contractor is entitled to claim delay costs only when project is delayed from the contract period and once the calim for time extention is accepted.

    You opinion in this matter is requested.

    

    Construction Management Guide Reply:
    November 1st, 2009 at 8:31 am

    Hello Javaid,
    Considering that there was no delay from the Employer’s end, it is obvious that the Contractor has taken a decision to accelerate the work without prior acceptance from the employer. Accordingly, his claim is irrelevant and has no solid basis.

    regards..

    Samer Skaik

39. MG Says:
    October 31st, 2009 at 4:46 pm

    Is escalation clause exists in FIDIC?

    

    Construction Management Guide Reply:
    November 1st, 2009 at 8:20 am

    Yes, it is there. Refer to clause 70.1 of Fidic 1987:

    70.1 Increase or Decrease of Cost

    There shall be added to or deducted from the Contract Price such sums in respect of rise or fall in the cost of labour and/or materials or any other matters affecting the cost of the execution of the works as may be determined in accordance with Part II of these Conditions.

    

    MG Reply:
    November 1st, 2009 at 11:55 am

    What about FIDIC 99?

    

    Construction Management Guide Reply:
    November 1st, 2009 at 2:37 pm

    Escalation clause is also available in FIDIC 1999. Refer to clause 13.8

40. Javaid Says:
    November 1st, 2009 at 3:04 pm

    Samer,

    Regarding the contract I was discussing, there was a week’s delay from our side for making amendments in the drawings for one of the tasks but that task was not even on the critical path. As the contract was completed within the contract period, is the contractor entiltled for claiming delay for that week?

    

    Construction Management Guide Reply:
    November 1st, 2009 at 4:13 pm

    Dear Javaid,
    there is misconcpetion here. according to the given detail, there is a total float of 8 weeks. This is because the proposed date for completion of the contractor is 8 weeks earlier than the date for completion as calculated from the contract. This means, the critical path doesn’t mean any thing when analyzing the delay. The situation is quite difficult to analyse the concurrent delay because no body has taken the right step of submitting a programme reflecting the contract.

41. Jeremiah kok Says:
    November 8th, 2009 at 6:07 am

    Are we fully responsible for our nomonated sub-contractor (NSC) as if they are our sub-contractor, over the issues like their performance, quality of work, progress of work and etc?

    

    Construction Management Guide Reply:
    November 9th, 2009 at 10:40 pm

    Hello Jeremiah,
    The Contractor is responsible of all his domestic and nominated subcontractors. However, FIDIC gives the Contractor the right to reject the nomination of subcontractors by presenting reasonable justifications of such rejection such as previous experience with this NSC or poor qualifications.

    Regards..

    Samer Skaik

42. Adel94 Says:
    November 15th, 2009 at 1:06 pm

    Good Morning,

    During the bid prepration we get an agreement with the cleint to have a materail esclation clause of 5 % per year which was minuted in minutes of calrification meetings. After three months from the original award the cleint issue revised LOA with no materail esclation. The contract is fixed re-measured unit rate.
    - Is this a breach of contract by the cleint?
    - Are we in title for compensation due to increase in materil cost?

    regards,

    Adel

    

    Construction Management Guide Reply:
    November 15th, 2009 at 1:38 pm

    Dear Adel,
    To give you precise answer, can you elaborate on the tendering stages you passed thru. I need answers to question such as: Have you received letter of award based on your bid? Was it conditional? post tender clarifications was part of the contract? etc..

43. Adel94 Says:
    November 15th, 2009 at 2:15 pm

    Here are the answer to your questions:
    - During the bid, many clarifications were settled and minuted and become part of the assumption and later the contract.
    - Yes, The first LOA was based on the tender without any conditions.
    - Yes, tender clarification was part of the contract as attachement.

    

    Construction Management Guide Reply:
    November 16th, 2009 at 10:48 am

    Thanks Adel,
    It seems that the employer wants to avail the credit crunch to deviate from his obligations under the valid original contract. If you don’t accept/sign the revised LOA, the original one will be binding to both parties and any deviation from the conditions therein will be considered a breach of contract.

    I recommend to go for negotatiation with the employer to prevent any potential dispute as a result of your objection to vary the contract conditions. However, if the original contract is terminated for employer’s convenience, you will be entitled for compensation of all damages and losses including your profit.

44. Adel94 Says:
    November 17th, 2009 at 10:16 am

    Thanks Mr. Samar,

    In case my management (Under pressre from cleint if you did not accpet, the contract will be terminated) signed the revised LOA, is this consdier as accpeteance to waive the materail esclation caluse.
    Presenting this in offical claim will be good to overcome this issue becuase the loses we get more than SR 6,500,000.

    regards,

    Adel

    

    Construction Management Guide Reply:
    November 17th, 2009 at 11:01 am

    In this case, it is better to negotiate with the Client and agree on an express term in the LOA to get paid for the losses incurred up to the date of the revised LOA. If the LOA is already signed without this clause, you are still entitled to recover the incurred costs prior to signing. You need to know that any addendum to contract will overrule and supersede any previous term or condition in your original contract.

    Any way, issuing revised LOA is not a professional approach in my opinion, as it should be under a proper form of addendum to the contract.

    Regards,,

    Samer Skaik

45. kenwyn Says:
    November 18th, 2009 at 12:33 am

    Hi

    Please provide a response to the following scenario:

    Prior to and even after the commencement of a project, references were made by the Contractor to the Client regarding rate increases for concrete, steel and formwork, unbeknown to the Consulting Engineer. There is no correspondence about the matter in any pre-construction or site meetings, but there is written evidence to show that the matter was referred to the Client by the Contractor. However, there is no record of any response from the Client, and now that the job is completed, the Consulting Engineer is refuting the claim for payment of the additional cost. What form of redress does the Contractor have, if any and what do you propose be done in the circumstance?

    Kenwyn

    

    Construction Management Guide Reply:
    November 18th, 2009 at 2:20 pm

    Hello Kenwyn,
    You firstly need to examine the contract documents if the escalation clause is there or not. For instance, if you use FIDIC 1987/1992, you have clause 70.1 but usually this clause is amended by particular conditions.
    Now, serving the proper claim notice is very important for the soundness of your claim. i am unaware of the nature of the written evidence you talk about, but it should mention that event and the intention to claim. Contractually, your case will be little weakened if no notice is served, but legally you should get compensation on the actual losses.

    I wish you could elaborate more on your contract detail to serve you better.

    Regards..

    Samer

46. kenwyn Says:
    November 18th, 2009 at 11:13 pm

    Hi Samer,

    I reviewed the signed contract and realised that FIDIC 1999 was used in the preparation of the General Conditions of Contract section, and that FIDIC 1987 was used in the preparation of the section for the Particular Conditions. In the latter case, clause 70.1, which you had referred to and deals with cost escalation, was deleted and replaced with one specifying the type of contract ( fixed price in this case). Now, is it the correct practice to use both forms of FIDIC (1999 & 1987)in the same contract? Is this conflicting even if the contract was mutually agreed to and signed?

    In the Contractor’s claim to the Client, the following statement was made in a letter: “Further to our discussion concerning the signing of the contract and the price increases in mainly concrete, reinforcing steel, blocks and formwork. The increased cost will be submitted to the Consultants (name of company)for their review and approval prior to submitting our invoices for payment”. Does this constitute a proper claim notice? If not, then what should be the next step?

    You also mentioned that legally the Contractor should get compensation on the actual losses. How is this possible?

    Thanks

    Kenwyn

    

    Construction Management Guide Reply:
    November 22nd, 2009 at 8:47 am

    Hello Kenwyn,
    General conditions of contract usually refer to a single standard form of contract while particular conditions could be a bespoke one. it will not harm if the employer refer to FIDIC 1987 in particular clauses taking into consideration that no conflict will occur. Anyway, contract is prioritizing particular conditions in case of such conflicts.

    Regarding the notice, it should be served within 28 day from the occurrence of the event to be an appropriate notice.

    about the legal part, it depends on the civil code in each country. In UAE for example, the notice for claim is not a mandatory prerequisite to be entitled for compensation.

    Regards..

    Samer Skaik

47. Adel94 Says:
    November 21st, 2009 at 2:18 pm

    Daer Mr. Samer,

    I unit rate subcontract agreement, the computation of estimated final price was subjected to 20 % discount while this discount was not reflected to the unit rate on the attachement.
    My subcontractor is now claiming for the original price and did not consider the discount becuase the unit rate on the attachement was not reflected after the discount was agreed. He is refereing back to the cluase of the agreement which is stating” the final price shall be determined by multiplying the rates stipulated in the attachement”.

    Now, is the discount is applicable to the unit rate where this agreement is unit rate remeasured.

    regards,

    Adel

    

    Construction Management Guide Reply:
    November 22nd, 2009 at 8:51 am

    Dear Adel,
    It should be applicable for the original scope only. any variation work shall be dealt separately.

    Regards.

    Samer Skaik

48. Baig Says:
    November 22nd, 2009 at 8:14 am

    How can a contractor substantiate their claim for “Loss of Profit” in case where Employer terminate contractor’s employment or delete big portion of works.

    

    Construction Management Guide Reply:
    November 22nd, 2009 at 9:02 am

    Dear Baig,
    It really depends on the actual case. You presented two cases here. In FIDIC forms of contract, if contract is terminated for employer’s convenience, you can claim for loss of opportunity which includes loss of profit. Refer to this link for more details:
    http://cmguide.org/archives/1438

    If Employer permanently deletes big portion amounting to 15% of the total scope, then readjustment to head office overhead shall be done. Refer to clause 52.3 for details.

    Regards..

    Samer Skaik

49. Adel94 Says:
    November 22nd, 2009 at 9:33 am

    Dear Mr. Samer,

    If the unit rate is firm and not subjected to esclation or adjustment price during the project duration, still any varation should be dealt separatley or the same unit rate will be applicable?!

    regards,

    Adel

    

    Construction Management Guide Reply:
    November 22nd, 2009 at 10:04 am

    Dear Adel,
    the rate should be reasonable and applicable to be used for any variation work. Engineer is the party who could determine this and fix the rate accordingly. i have answered a similar question here before. Please refer to it.

    Samer

50. kenwyn Says:
    November 24th, 2009 at 12:02 am

    Hi Samer,

    Thanks for the information posted. I’ll be in touch.

    Best regards

    Kenwyn

51. Sam Says:
    November 29th, 2009 at 2:49 pm

    if a Joint venture of a construction contract is embroiled in internal problems, will the owner have the right to terminate until a joint resolution of the JV partner is resubmitted to confirm the way forward?

    

    Construction Management Guide Reply:
    November 29th, 2009 at 7:24 pm

    Dear Sam,
    If such problems developed in a way that the JV contractor will not fulfill his obligations as stated in the contract and will be in default, then the Employer have the right to terminate the employment.

    Regards.

    Samer

52. Adel94 Says:
    December 9th, 2009 at 1:45 pm

    Daer Mr. Samer,

    We get a new contract awarded to excuate Co-gen plant, but there is a clause with high risk. I need your profissional advice to accomdate scuh clause during the construction.
    The clause state:
    - “The contractor has no right to claim if The Engineer fails to perform or meet any of its obligations”.
    -”The engineer can effectivly alter the contracotr’s scheduled milestone and/or completion dates and the contracotr will not be entitled to claim additional costs”.

    

    Construction Management Guide Reply:
    December 9th, 2009 at 4:18 pm

    Dear Adel,
    I wonder how you signed a contract including this clause. Anyway, you should have assessed all risks involved and mitigated the same by mainly allowing for maximum LD’s cost and appropriate prolongation cost in your offer.

    If this didn’t happen, then you need to be very diplomatic and keep a friendly relationship always with with the Engineer to try to protect your rights.

    Regards..

53. MOHAMMED Says:
    December 12th, 2009 at 10:17 am

    Dear sir,

    A Project awarded with Traditional procurement, measure & pay contract (under Fidic 1987) with a contract period of six months.

    The issue is employer doesnot get local authority approvals which is under employer’s scope.

    Contractor’s expected work done per month cannt be achieved. So contractor running with under recovering of overheads due to lower value of work done.

    What would be the claim head here? and what would be the basis? & procedure??

    

    Construction Management Guide Reply:
    December 13th, 2009 at 12:28 am

    Dear Mohammad,
    You need to follow the contractual procedure of building the claim case as follows:

    1- Send a notice of delay within 28 days from the occurance of the delay as per clause 44.2, bearing in mind that your entitlement to claim is secured pursuant to clause 44.1 e.
    2- Submit interim/detailed particulars of the claim within 28 days or as agreed by the Engineer. Refer to a relevent article on how to prepare the claim here:
    http://cmguide.org/archives/28

    On the other hand, you need to calculate the prolongation cost which includes all losses and damages incurred due to such delay such as site overheads, headoffice overheads, subcontractors claims, etc…
    Refer to CMGUIDE articles and downloads to
    learn how to calculate the cost.

    Regards..

    Samer Skaik

    

    MOHAMMED Reply:
    December 13th, 2009 at 7:25 am

    Dear samer,

    Thanks for your swift reply
    Yet i have another followup question?
    Let me put in this way,
    Same above scenario but the contract is under FIDIC 99 yellow book (plant, design and build)
    What would be the claim head? and what would be the basis??
    (If i am right , i can follow same claim procedure)

    

    Construction Management Guide Reply:
    December 13th, 2009 at 8:20 pm

    Dear Mohammad,
    FIDIC forms of contracts usually have the same claim procedure.

54. Hatim Says:
    December 21st, 2009 at 1:41 pm

    We are MEP S/C. our S/C agreement is based on FIDIC 1987/1992 both conditions of Contract and Subcontract for works of Civil Engg. construction.WE have been going thru very non-payment issues with the M/C for the last 7 months. We waved “Suspension or delaying works” clause 69.4 with notice period of 28 days but notice period is over and no payment done.
    my question: what is next?
    the M/C is forcing us on a new suplimentary agreement on which to complete the remaining scope of works in stages and without payment certificate but payment based on stage completion i.e if the each stage is completed on the time , we are paid. If not penalty is imposed….tell me what to do?? Thanks

    

    Construction Management Guide Reply:
    December 22nd, 2009 at 7:44 am

    Hello Hatim,
    This is a repeating situation in the market due to credit crunch. Your decision here depends on your company strategy. You can terminate the contract as per clause 69.1, keep the work suspended or reduce the rate of progress. Your claim for damages will be strong if it is backed up with proper substantiation and records.

    Otherwise, you have the friendly negotiation route to apply win to win approach with your Employer.

    Anyway, the Employer can’t force you to alter the contract.

    Regards.

    Samer Skaik

55. Manish Says:
    December 23rd, 2009 at 9:59 am

    Who owns the float in the project???

    

    Construction Management Guide Reply:
    December 26th, 2009 at 8:54 pm

    Dear Manish,
    This is a very debatable subject. Usually, the standard forms of contracts don’t mention this critical issue, while I strongly recommend so since many disputes pertaining the delay analysis of EOT claim depends on the ownership of the float. I refer you to an article in CMGUIDE which covers your query:
    http://cmguide.org/archives/37

    Regards..

    Samer Skaik

56. masood Says:
    December 23rd, 2009 at 1:57 pm

    when we started contract the tax was 3% and now the tax is 6% ,can we claim it as per clause 70.2 of coc 1987

    

    Construction Management Guide Reply:
    December 26th, 2009 at 8:57 pm

    Dear Masood,
    Yes you can claim provided that such issue was not known to you 14 days prior to submit your tender.
    You need also to check your particular conditions of contract as this clause is usually altered by the Employers to avoid the involved risk.

    Regards.

    Samer Skaik

57. liaqat hayat Says:
    December 28th, 2009 at 9:08 am

    Hi,
    I have following questions on subject clauses.
    1) Why there is different rate of calculating liquidated damages under
    clause 47.1 &47.2 ?
    2)If there is a instructed varied work containing items where existing boq
    rates in the contract are applicable,is it still necessary to prepare a
    variation order on occurance or leave it to substancial completion stage
    when anyway overall increase/decrease shall be reviewed under clause 52.3
    I shall be obliged for clarification
    Regards
    Liaqat Hayat

    

    Construction Management Guide Reply:
    December 29th, 2009 at 3:16 pm

    Dear Liaqat,

    I list below my answer in the same order:

    1) I am unable to understand this question. Do you mean the reasons beyond the reduction in LDs?

    2)You are not obliged to submit the assessment of such instructed variation within a specific timeline.

    3) Adjustment of overheads as per clause 52.3 is done at the last stage of the final account (after taking over) where all information about remeasured quantities and variations is available. In practice, the assessment is conducted during DLP but this is not binding since the contract is silent about it.

    Waiting for your clarification on (1).

    Regards..

    Samer Skaik

58. liaqat hayat Says:
    December 29th, 2009 at 7:52 pm

    Dear Samer,
    While thanking you for your prompt response,I re-phrase my questions for clarity.
    1)The LDS under clause 47.1 is say 0.1%per day of contract value(i.e.total value of original work)whereas under clause 47.2, it is 0.1%per day of remainder contract value( balance work)of the sections/parts.If my understanding correct?If so,why two different principles adopted under the two clauses to calculate liquidated damages here.It appear to be inequitable.
    2)My specific question is can I postpone the submission of a VO till toc issuance if varied work contain items already available in the contract BOQ?I am adviced that VO must be submitted on occurance now.I am looking for second opinion.
    3)Again under clause 47.1,I need clarity the date from which LDS are to be deducted?My understanding is from date of TOC issuance date only even if these are leviable much before this due to contractual completion date having passed and time not extended.
    I shall be grateful for your detailed comments.
    Regards-Liaqat Hayat

    

    Construction Management Guide Reply:
    December 30th, 2009 at 9:24 am

    Dear Liaqat,

    1) The Employer is the party who decides on the nature of liquidated damages prior to tendering and the contractor should considers the risks involved. Anyway, I quote the following statement from FIDIC Guide to clarify the issue:

    “If delay in completion does not affect the whole of the Works, arrangements for a pro-rata reduction are set out in Sub-Clause 47.2. If it is considered by the Employer that a pro-rata reduction would not be equitable, alternative provisions should be included in Part II.”

    2) This is only applicable for claims made pursuant to clause 53.1.

    3) The Employer may deduct the amount of liquidated damages from any monies due or to become due to the Contractor. This may be conducted by the Engineer when the contractor submits his interim/final payment application after the passing of TOC in light of the actual days of delay.

    Regards..

59. Chandan Kamat Says:
    December 30th, 2009 at 1:02 pm

    Dear Samer,
    I sincerely appreciate the value you are adding to construction practice specially in middle east.
    My query is regarding the Prime cost items included in the fixed priced lump sum contracts.
    What particular conditions can be added to the General conditions of contract (State of Qatar)to minimize the conflicts at latter stage related to final account of PC items in case of variances in prime cost and quantities of the item mentioned in BOQ.(Preferably from employers perspective.)
    Regards,
    Chandan Kamat.

    

    Construction Management Guide Reply:
    December 30th, 2009 at 2:24 pm

    Dear Chandan,
    Thank you for your impression about CMGUIDE.

    The best thing to deal with PC items without conflict is to agree on the following methodology of adjusting PC items:

    1- State a formula for the adjustment of PC items which is simply as follows:

    ((Supplier rate-PC rate) X Actual Qty) + OH + P

    2- The percentage for spare parts and wastage to be considered. For example, a particular percentage for them can be clearly stated in the contract and included in the PC rate and the supplier to include the same in his rate or easy calculation.

    3- Contractor Overheads and profit to be agreed and stated as part of the contract.

    Hint: for tiles, the pattern and size have a direct impact on supply and fixing rate which should be considered by the contract administrator case to case.

    Thanks and regards.

    Samer Skaik

    

    Chandan Kamat Reply:
    December 30th, 2009 at 7:10 pm

    Dear Samer,
    Appreciate your reply. I was refering to more complecated scenario for example
    Cost of fixing the ceramic tiles PC rate 40/m2, quantity mentioned in the BOQ 100m2, rate quoted by contractor 100/m2 which includes PC rate 40/m2, labour,OH and profit.
    Now there can 4 different scenarios,
    1. actual rate more than pc rate (40/m2), actual quantity more than BOQ qty.
    2. Actual rate more than pc rate, actual quantity less than BOQ qty.
    3. Actual rate less than pc rate, actual quantity more than BOQ qty.
    4. Actual rate less than pc rate, actual quantity less than BOQ qty.
    In fixed lump sum contract where contractor are supposed to verify the BOQ quantities and in the event when contractor agrees to BOQ quantities which at latter stage change (increase or decrease) which quantities should we consider for final account.
    2.

    

    Construction Management Guide Reply:
    December 31st, 2009 at 9:16 am

    Dear Chandan,
    If the PC rate varies from the one inserted in BOQ, the adjustment will be applicable as I explained above taking the actual quantities -Not BOQ quantity- into consideration.

    if the PC rate is the same, no adjustment is required to the contract regardless of any difference between BOQ Qty and actual qty since the contract is based on lump sum basis.

    Regards.

60. masood Says:
    December 31st, 2009 at 9:51 am

    who appoint the engineer,is it necessary for employer to get the consent of contractor while appointing him.fidic1987

    

    Construction Management Guide Reply:
    January 9th, 2010 at 8:57 am

    Dear Masood
    Liaqat response is good enough to answer your question.
    I quote it here for your reference:
    ——-
    liaqat hayat Says:
    January 2nd, 2010 at 4:47 pm edit
    Hi,
    The Engineer Is appointed by the Employer not necssarily with Contractor’ consent.There is an obligation on the part of Employer to ensure that the Engineer duly performs as he is appointed by him.
    Regards
    ——-

    Regards.

    Samer Skaik

61. liaqat hayat Says:
    January 2nd, 2010 at 4:47 pm

    Hi,
    The Engineer Is appointed by the Employer not necssarily with Contractor’ consent.There is an obligation on the part of Employer to ensure that the Engineer duly performs as he is appointed by him.
    Regards

    

    Construction Management Guide Reply:
    January 9th, 2010 at 8:58 am

    Dear Liaqat,

    Thanks for your valuable participation in CMguide.

    Samer

62. Raj Says:
    January 3rd, 2010 at 6:25 pm

    what contractual clause can i use if a subcontractor quotes reasons for delay as “defective materials supplied by subcontractor’s vendor”

    

    Construction Management Guide Reply:
    January 9th, 2010 at 9:05 am

    Dear Raj,
    The risk of defective material of the suppliers is solely borne by the subcontractor and there is no contractual nor legal ground to justify the delay.

    regards..

    Samer Skaik

63. liaqat hayat Says:
    January 5th, 2010 at 5:57 pm

    Dear Samer,
    Do the contractor’s overheads include salaries of his site supervision staff like surveyor/inspector etc or has to be paid separately for non-BOQ items when agreeing a new rate.His overhead and profit is already fixed in the contract as 25%

    

    Construction Management Guide Reply:
    January 9th, 2010 at 10:10 am

    Hi Liaqat,
    there are two types of overheads:
    1- Site overheads: this is Usually considered in the BOQ preliminaries

    2- Head office overhead: This is usually considered as a percentage included in the BOQ rate.

    You need to examine the term overhead in your contract and what it refers to.

    Anyway, generally speaking, if the preliminaries exist in BOQ in your case, you can’t claim since all staff salaries are included. If not, then it is usually understood that it is included in your 25% markup.

    Regards..

    Samer Skaik

64. nishith_dubey Says:
    January 19th, 2010 at 4:03 pm

    can a contract be terminated directly under the UAE law (247 / 892) in spite of having provision of FIDIC conditions govering the contract in order to bypass lenghty process?

    

    Samer H Skaik Reply:
    January 26th, 2010 at 9:58 pm

    Termination of contract can be done by mutual agreement or court order as per UAE civil code which overrules the contract.

    

    nishith_dubey Reply:
    January 27th, 2010 at 10:11 am

    In this scenario, then what is the point of agreeing to the terms and conditions of Contract Agreement which has clearly defined procedure for all kinds’ of events and also governs the execution of Contract? Would this not dilute the sanctity of the signed / agreed Contract agreement? Would this also allow aggrieved party to circumvent the agreed contractual procedure in order to have early result? Please clarify. Thanks

    

    Samer H Skaik Reply:
    January 29th, 2010 at 10:37 am

    Contract conditions must be legally valid. For example, you can’t have a contract for supplying materials from Israel even if the both parties have agreed and signed the contract because THE BOYCOTT is stated in the UAE law.

65. Dilip Says:
    January 25th, 2010 at 12:18 am

    BOQ under CESMM3 , can Head office Overhead be adjusted in accordance with clause 52.3?

    Please advise

    

    Samer H Skaik Reply:
    January 26th, 2010 at 10:00 pm

    Yes it can be adjusted as stated in clause 52.3 regardless of the method of measurement used.

66. Mahmood Says:
    February 8th, 2010 at 9:53 am

    Dear Sir,

    i would like to ask about extension of time “Delay in Nomination” how would be determined straight from the baseline progamme without conisdering the Main contractor delay till the nomination. Is the Employer is bound to bring nominated contractor at site whether site is ready or not?

    Regards,
    Mahmood

67. Samer H Skaik Says:
    February 16th, 2010 at 11:31 pm

    Dear Mahmoud,
    There are many methodologies for the delay analysis and it is not a straight forward exercise. I refer you to two articles published in CMGUIDE before about the delay analysis.

    However, in case of concurrent delays as it is obvious in your case, the SCL protocol -which is available in download library- will help you decide on your particular problem.

    Regards..

    Samer

68. alex Says:
    February 28th, 2010 at 3:29 pm

    what will be my contractual basis if i am to make a cost and extension of time claim?

    

    Samer H Skaik Reply:
    March 1st, 2010 at 8:03 am

    Dear Alex,
    It depends on the event that caused the claim.

    

    jane Reply:
    March 3rd, 2010 at 12:12 pm

    The contractor has submitted their cost claim (preliminaries) for the EOT. The EOT was mostly due to variation order and was approved by the Owner.
    Does the contractor has the right for this claim as per the clause in FIDIC for Extension of Time?
    This clause mentions “the amount of such extension”. Does this pertain to the duration or cost or both?
    Regards…

    

    Samer H Skaik Reply:
    March 5th, 2010 at 9:34 pm

    Dear Jane,
    If the volume of extra works can’t be done with the planned resources in the same time frame as shown in the baseline programme where the relevant activity on the critical path, then you have a solid basis for the claim pursuant to clause 44.1(a) if you use FIDIC 1987 or clause 8.4(a) of Fidic 1999.

    For example, if the quantity of steel reinforcement in the raft have been increased significantly due to any redesign, then you will not be able to complete fixing the steel in the same duration with the available resources. If you decide to get more resources than planned to crash the activity, then you should examine the acceleration cost if any.

    Regards,,

69. alex Says:
    March 1st, 2010 at 1:39 pm

    the extension of time was approved due to many variation orders initiated by the client.

    am i eligible to make a claim for cost impact of the EOT and what contractual basis should i base it to? is the Clause 44.1 of FIDIC applicable?

    

    Samer H Skaik Reply:
    March 5th, 2010 at 9:39 pm

    Hi Alex,
    Clause 44.1 entitles you for an extention of time only. For the prolongation cost associated with EOT claim, you need to base your claim of the additional payment on clause 53.1 and you shuold serve notice in this regard.

    

    bernard Reply:
    April 16th, 2010 at 4:16 pm

    Dear Samer,

    If no notice has been given? Can we still claim for the prolongatio costs?

    

    Samer H Skaik Reply:
    April 17th, 2010 at 2:25 pm

    Yes, you can if you follow FIDIC 1987.

    

    bernard Reply:
    April 17th, 2010 at 7:42 pm

    It is not clear to me what do you mean by yes you can if you follow FIDIC 1987. What am I going to follow in FIDIC 1987. I have not following because we failed to give 28 days notice as required under Clause 53.1. Do I am still entitled for relief? In what basis? Because the Client is insisting that we have no notice so our claims is waive.

    

    Samer H Skaik Reply:
    April 18th, 2010 at 9:30 am

    FIDIC 1987 doesn’t state that you will lose your rights if the notice is not served. It may weaken your case little bit, but you are still entitled legally. In Fidic 1999, clause 20.1 clearly states that you will lose your entitlement if the notice is not served.

70. Bo Ceballos Says:
    March 2nd, 2010 at 11:13 am

    Dear Sir,

    What are the attaching documents required of 100% work completion claim in both original & variation order? What is the practice in most company here in UAE for final settlement?
    Thank you and more power.

    Bo

    

    Samer H Skaik Reply:
    March 5th, 2010 at 9:49 pm

    Dear Bo,
    Please refer to clause 60.5 and 60.6 which explain the contractual procedures for the final payment:

    60.5 Statement at Completion

    Not later than 84 days after the issue of the Taking-Over Certificate in respect of the whole of the Works, the Contractor shall submit to the Engineer six copies of a Statement at Completion with supporting documents showing in detail, in the form approved by the Engineer,

    (a) the final value of all work done in accordance with the Contract up to the date stated in such Taking-Over Certificate

    (b) any further sums which the Contractor considers to be due and

    (c) an estimate of amounts which the Contractor considers will become due to him under the Contract.

    The estimated amounts shall be shown separately in such Statement at Completion. The Engineer shall certify payment in accordance with Sub-Clause 60.2.

    60.6 Final Statement

    Not later than 56 days after the issue of the Defects Liability Certificate pursuant to Sub-Clause 62.1, the Contractor shall submit to the Engineer for consideration six copies of a draft final statement with supporting documents showing in detail, in the form approved by the Engineer,

    (a) the value of all work done in accordance with the Contract and

    (b) any further sums which the Contractor considers to be due to him under the Contract or otherwise.

    If the Engineer disagrees with or cannot verify any part of the draft final statement, the Contractor shall submit such further information as the Engineer may reasonably require and shall make such changes in the draft as may be agreed between them. The Contractor shall then prepare and submit to the Engineer the final statement as agreed (for the purposes of these Conditions referred to as the “Final Statement”).

    60.7 Discharge

    Upon submission of the Final Statement, the Contractor shall give to the Employer, with a copy to the Engineer, a written discharge confirming that the total of the Final Statement represents full and final settlement of all monies due to the Contractor arising out of or in respect of the Contract. Provided that such discharge shall become effective only after payment due under the Final Payment Certificate issued pursuant to Sub-Clause 60.8 has been made and the performance security referred to in Sub-Clause 10.1, if any, has been returned to the Contractor.

    60.8 Final Payment Certificate

    Within 28 days after receipt of the Final Statement, and the written discharge, the Engineer shall issue to the Employer (with a copy to the Contractor) a Final Payment Certificate stating

    (a) the amount which, in the opinion of the Engineer, is finally due under the Contract or otherwise, and

    (b) after giving credit to the Employer for all amounts previously paid by the Employer and for all sums to which the Employer is entitled, other than under Clause 47, the balance, if any, due from the Employer to the Contractor or from the Contractor to the Employer as the case may be.

71. Emmanuel Amankwah Says:
    March 5th, 2010 at 1:39 am

    How do i use preliminaries in claiming for extension of time granted by the consultant engineer on a project?

    

    Samer H Skaik Reply:
    March 5th, 2010 at 9:55 pm

    Dear Emmanuel,
    I guess you mean the prolongation cost calculations. The precise way is to calculate the actual cost which is not an easy job. Alternatively, you can calculate the preliminaries on a pro-rata basis.

    Regards..

72. Nasair Says:
    March 5th, 2010 at 2:45 pm

    Hi

    I have a lump sum contract with PC rate and provisional sum ,the provisional sum is separated in the BOQ there is nothing in the contract how to deal with the PC rates items qauntitiy .
    all mentioned is that the conract is lumpsum and quantities is the contractor responsibilty.
    disputes between client and contractor happended due to unclear agrement done.
    kindly advice as per the information mentioned in the contract.do we have to deal with actual amount or BOQ amount for PC items

    Thank you

    

    Samer H Skaik Reply:
    March 5th, 2010 at 9:59 pm

    Hi Nasair,
    I have answered some similar questions above, however, for PC rates adjustments, you have to consider the actual quantities from the contract drawings not the BOQ quantities.

    If the PC rate is as same as the actual cost of the material, then no adjustment to be made for the BOQ item regardless of the difference in quantities between BOQ and drawings.

    

    Nasair Reply:
    March 6th, 2010 at 11:44 pm

    Hi Samer

    we have to consider the actual quantity even if the pc items are included with the lump sum items,it is not seperated like the provisional sum.
    some people says if it is seperated so you have to consider the actual amount and if it is included in the lump sum items so you have to consider the bill amount.

    kindlly advice

    Thank you

    

    Samer H Skaik Reply:
    March 8th, 2010 at 4:56 pm

    Hi Nasair,

    Let me understand you clearly. Take an example: the PC item of ceramic tile is 10$ and it is included in the ceramic tile BOQ item for complete supply and install with total amount of 100$ for the item. BOQ relevant quantity is 5000 m2 while actual quantity is 10000 m2.

    If the actual cost of the material is 20$, then the adjustment will be as follows:

    (20-10)X(10000) X Markup%= $ 100,000 X markup% (To be added to the contract price)

    Here, you claim the difference in the material cost which you did not include in your lump sum price regardless the PC item is separate or included.

    Is it clear now?

    Regards..

73. Keerthi Says:
    March 9th, 2010 at 4:28 pm

    Hi Samer

    My project is lumpsum Contract based on FIDIC 1987 4th edition reprinted on 1992. Preiority of documents are Drgs, Specs and BoQ. During agreement Contractor submitted his own BoQ ignoring Consultants BoQ.

    As per Site Instruction, there was changes in diameters and increase in length (by 34%) of a particular service. In this case we cannot identify and evaluate a change on apple to apple basis.

    Contractor submitted his Quantity measuring both Contract & Revised Drgs for additions and omissions. As a Consultant QS I measeured revised drgs. for additions and used BoQ quantity for omission.

    Kindly advise whose approach is correct (omission as per Contract Drg / BoQ qty) and which clause I can refer to justify my metod of evaluation.

    Thanks

    

    Samer H Skaik Reply:
    March 11th, 2010 at 1:54 pm

    Dear Keerthi,

    Firstly,I have doubt about the priority of contract documents you are referring to since it is not stated in FIDIC 1992.

    Secondly, about your question, you must go for the actual quantities for addition or omission not the BOQ quantity. Usually, this approach is mentioned somewhere in the Preambles.

    Warm regards

74. Abdul Hamid Says:
    March 10th, 2010 at 2:11 pm

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

    This is if an item is exist in the Prelims bill for HSE
    and as per FIDIC 87/92

    

    Samer H Skaik Reply:
    March 11th, 2010 at 1:58 pm

    Dear Abdul Hamid,
    Contractually, you can issue Non conformance notice (NCR) to the contractor and deduct some money from the contractor if he fails to comply within a reasonable time. Refer to clause 39.2 to justify your entitlement.

    Regards

75. Shamsusaman.S Says:
    March 13th, 2010 at 8:30 am

    Dear Samer,

    Further to your reply on Sep 30th 2009 to Vijay,
    Can you please elaborate about the course details and the insttitution from where can get the same.
    Eager for your reply
    Thanks & Best regards

    

    Samer H Skaik Reply:
    March 15th, 2010 at 7:52 am

    Please contact Prof. Samaratunga. He is besed in Dubai. Email: sam99@eim.ae. there will be one course in abu dhabi soon.

    Regards

76. Shamsusaman.S Says:
    March 13th, 2010 at 8:37 am

    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

    

    Samer H Skaik Reply:
    March 15th, 2010 at 7:55 am

    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,

77. kenwyn Says:
    March 23rd, 2010 at 12:49 am

    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?

    

    Samer H Skaik Reply:
    March 28th, 2010 at 10:56 am

    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..

78. Ricardo N Says:
    March 27th, 2010 at 7:03 pm

    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

    

    Samer H Skaik Reply:
    April 11th, 2010 at 9:11 am

    Hi Ricardo,
    Your question is not clear for me. May you elaborate further so I can help you better?

    

    Ricardo N Reply:
    April 18th, 2010 at 6:47 am

    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

    

    Samer H Skaik Reply:
    April 18th, 2010 at 9:46 am

    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.

79. Sunil Says:
    April 7th, 2010 at 10:39 am

    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

    

    Samer H Skaik Reply:
    April 17th, 2010 at 2:26 pm

    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..

80. Mohamed H Says:
    April 13th, 2010 at 4:03 pm

    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

    

    Samer H Skaik Reply:
    April 17th, 2010 at 2:34 pm

    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..

81. bernard Says:
    April 16th, 2010 at 3:46 pm

    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

    

    Samer H Skaik Reply:
    April 17th, 2010 at 2:36 pm

    Hi Bernard,

    You need to refer to clause 53.1 to claim for such costs arisen from the extension of time.

82. bernard Says:
    April 16th, 2010 at 4:03 pm

    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

    

    Samer H Skaik Reply:
    April 17th, 2010 at 2:41 pm

    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.

83. Rafael (Muscat, Oman) Says:
    April 17th, 2010 at 3:16 pm

    Hi Bernand,

    I just want to add to Samer. I guess the ommission of the suceeding subcluses is an error as these clauses explain the ground on which claims could be granted namely if the increase in materials, labour is as a result of government legislation, increase in petroleum prices etc.

    You may need to arm yourself with he supportive documents that this increase couldnt have been forseen as a comopetent contractor.

    Where are you located? as this may help to offer you a better informed advice

    Cheers

84. Vachhrajani Jayesh Says:
    April 19th, 2010 at 4:12 pm

    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

    

    Samer H Skaik Reply:
    April 20th, 2010 at 9:44 am

    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..

85. M.Owies Says:
    April 19th, 2010 at 11:34 pm

    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?

    

    Samer H Skaik Reply:
    April 20th, 2010 at 10:01 am

    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..

    

    M.O. Reply:
    April 20th, 2010 at 6:54 pm

    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 ?

    

    Samer H Skaik Reply:
    April 22nd, 2010 at 10:08 am

    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..

86. Vachhrajani Jayesh Says:
    April 21st, 2010 at 9:15 am

    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

    

    Samer H Skaik Reply:
    April 22nd, 2010 at 10:25 am

    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

87. md sahir Says:
    April 25th, 2010 at 11:13 pm

    Dear Mr.Samer.

    Great Work, hands off to you.

    Regards

    Mohd. Sahir

88. Mohamed A. A. Says:
    April 28th, 2010 at 12:46 am

    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

    

    Samer H Skaik Reply:
    May 4th, 2010 at 5:13 pm

    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.

89. Mohamed A. A. Says:
    April 29th, 2010 at 5:07 pm

    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.

    

    Samer H Skaik Reply:
    May 4th, 2010 at 5:15 pm

    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.

90. Omar Says:
    May 4th, 2010 at 3:30 pm

    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

    

    Samer H Skaik Reply:
    May 4th, 2010 at 5:17 pm

    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.

91. Ramy Emad Says:
    May 10th, 2010 at 2:08 am

    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?

    

    Samer H Skaik Reply:
    May 10th, 2010 at 9:59 am

    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

92. Ramy Emad Says:
    May 10th, 2010 at 4:38 pm

    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

    

    Samer H Skaik Reply:
    May 16th, 2010 at 9:35 am

    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..

93. soomun Says:
    May 13th, 2010 at 4:40 pm

    how can you demonstrate a delay event and showing its effect on a program works.

    

    Samer H Skaik Reply:
    May 16th, 2010 at 9:39 am

    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..

94. imran usaf Says:
    May 17th, 2010 at 11:01 pm

    hi dr samer
    this is great to see ur guidance page.
    this is really a great job
    i want to thank u as while reading ur replies to others i got a lot of knowledge
    regards
    imran usaf

    

    Samer H Skaik Reply:
    May 22nd, 2010 at 9:56 pm

    Thanks Imran,
    We really hope that we offering something of value to you..

    Keep in touch

    Samer

95. soomun Says:
    May 21st, 2010 at 11:10 am

    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.

    

    Samer H Skaik Reply:
    May 22nd, 2010 at 10:03 pm

    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,

96. soomun Says:
    May 21st, 2010 at 11:39 am

    when claiming for a variation works can i claim also the supervision cost.

    

    Samer H Skaik Reply:
    May 22nd, 2010 at 10:05 pm

    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,

97. Hamid Says:
    May 24th, 2010 at 1:33 pm

    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……………..

    

    Samer H Skaik Reply:
    June 2nd, 2010 at 6:07 pm

    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.

98. soomun Says:
    May 25th, 2010 at 4:41 pm

    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.

    

    Samer H Skaik Reply:
    June 2nd, 2010 at 6:14 pm

    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..

99. Yoga Says:
    May 30th, 2010 at 2:07 pm

    In contract evaluation, if the team fails to detect an error and it is done later during the excution of the contract what happens.

100. Yoga Says:
     May 30th, 2010 at 2:14 pm

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

     

     Samer H Skaik Reply:
     June 2nd, 2010 at 6:17 pm

     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.

101. Zenith Sharma Says:
     June 3rd, 2010 at 2:43 pm

     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

     

     Samer H Skaik Reply:
     June 7th, 2010 at 9:41 am

     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

102. Felicia Cheah Says:
     June 7th, 2010 at 8:56 am

     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.

     

     Samer H Skaik Reply:
     June 7th, 2010 at 10:03 am

     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.

103. Barhoumy Says:
     June 12th, 2010 at 4:56 pm

     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

     

     Samer H Skaik Reply:
     June 22nd, 2010 at 3:24 pm

     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..

104. akbalfour@gmail.com Says:
     June 17th, 2010 at 6:03 pm

     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

     

     Samer H Skaik Reply:
     June 22nd, 2010 at 3:28 pm

     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..

105. akbalfour@gmail.com Says:
     June 22nd, 2010 at 5:13 pm

     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.

     

     Samer H Skaik Reply:
     June 23rd, 2010 at 3:07 am

     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.

106. barhoumy Says:
     June 23rd, 2010 at 1:28 pm

     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).

     

     Samer H Skaik Reply:
     July 15th, 2010 at 11:48 am

     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,

107. akbalfour@gmail.com Says:
     June 30th, 2010 at 5:29 pm

     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?

     

     Samer H Skaik Reply:
     July 15th, 2010 at 11:57 am

     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.

108. soomun Says:
     July 7th, 2010 at 3:23 pm

     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.

     

     Samer H Skaik Reply:
     July 15th, 2010 at 6:15 pm

     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,

109. nerses Says:
     July 13th, 2010 at 6:45 pm

     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,

     

     Samer H Skaik Reply:
     July 19th, 2010 at 1:59 pm

     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

110. Idris Meer Says:
     July 28th, 2010 at 5:07 pm

     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.

     

     Samer H Skaik Reply:
     September 1st, 2010 at 12:09 pm

     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

111. Upali Mallawaarachchi Says:
     August 3rd, 2010 at 2:06 pm

     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%

     

     Samer H Skaik Reply:
     September 1st, 2010 at 12:14 pm

     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,

     

     Upali Mallawaarachchi Reply:
     September 2nd, 2010 at 1:53 pm

     Dear Samer,

     Thanks for your comments. My further comments are as follows:

     Contractor’s mark up contains site overheads, head office overheads and profit. It is true that profit should remain constant. But, overhead contribution on additional work items depends on the Contractor’s involvement.
     - In purchases, Contractor’s involvement is minimal;
     - In subcontracting, involvement is moderate;
     - In direct construction, involvement is high.

     When Engineer fixes a rate for a new item, isn’t he required to consider the above situation?

     Further, if the new item is small compared to whole of the Works, the effect of the new item on the overheads would be very small comparted to the originally assumed overheads at the tendering.

     Please give your comments.

     Upali

112. Upali Mallawaarachchi Says:
     August 3rd, 2010 at 2:36 pm

     This is regarding an expressway contract based on FIDIC 1987. Contractor has indicated 35% as his overheads and profit percentage in the rate breakdown submitted with the tender. The rate breakdown is only a supporting document, but not made a part of the Contract.

     Is it compulsory that the Engineer should use 35% when fixing new rates for new items?
     Can the Engineer use different percentages for different type of new work depending on the extent of involvement of the Contractor?
     eg: Supply of an item of goods directly from the shop may need a smaller percentage such as 10%.

113. Tasnim Yusoff Says:
     August 11th, 2010 at 11:38 am

     Hi all,

     I need advice regarding this issue.

     Im doing EOT program for my client which is the mechanical and elenctrical contractor. I dont have lots of exerience regarding EOT program.
     At my site we have lots of area of cncern issue (AOC). I need to put most of the delay event indide my programme. SOme of the AOC issue happened at certain area at each floor which we still can carry on with another job at da same time.
     How to put all thise issue inside the programme and link it to the activities inside the primvers? As some of the activities already start anf some stil nit started..

     Tq
     Tsx

     

     lumulal Reply:
     August 29th, 2010 at 1:09 am

     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.

     

     Samer H Skaik Reply:
     September 1st, 2010 at 12:18 pm

     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,

114. soomun Says:
     August 20th, 2010 at 11:32 am

     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

     

     Samer H Skaik Reply:
     September 1st, 2010 at 12:26 pm

     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,

115. Adel94 Says:
     August 25th, 2010 at 2:36 pm

     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
     “

     

     Samer H Skaik Reply:
     September 1st, 2010 at 12:32 pm

     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,

116. John Froehl Says:
     September 14th, 2010 at 6:26 pm

     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

     

     Samer H Skaik Reply:
     October 8th, 2010 at 11:33 am

     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.

117. Gene Says:
     September 16th, 2010 at 2:49 am

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

     

     Samer H Skaik Reply:
     October 8th, 2010 at 11:38 am

     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.

118. Suresh.R Says:
     September 26th, 2010 at 4:32 pm

     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 rovisional 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.

     

     Samer H Skaik Reply:
     October 8th, 2010 at 11:50 am

     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.

119. guy_black123 Says:
     October 4th, 2010 at 6:21 pm

     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

     

     Samer H Skaik Reply:
     October 8th, 2010 at 11:58 am

     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.

     

     guy_black123 Reply:
     October 9th, 2010 at 7:55 am

     Dear Samir. Thank you for the reply. I am following this proposal already. Unfortunately it is so diffiult to find any references for local regulations regarding construction eve on the Government websites. Thank you again, I will post if it I find the specific Law. Great site, very useful for working professionals. Regards Guy

120. Vicky Khurmi Says:
     October 18th, 2010 at 5:04 am

     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.

     

     Samer H Skaik Reply:
     October 30th, 2010 at 6:42 pm

     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.

121. Ayman Edelbi Says:
     October 26th, 2010 at 2:47 pm

     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

     

     Samer H Skaik Reply:
     October 30th, 2010 at 6:50 pm

     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.

     

     T.Yohannes Okubay Reply:
     December 26th, 2010 at 5:02 pm

     Dear Ayman,

     Generally Lump Sum (fixed-price contracts) is a contract type meaning project can be awarded at a price that cannot be adjusted for any change in cost of labour, material or other maters (FIDIC 1999, P-92) whereas provisional sum is a sum of money included in a bill of quantities to cover the cost of unexpected work with some exception for defined work. Hence, a project cannot be awarded as provisional sum. As Samer explained the sum is spent at the direction of the engineer. However, if the scope of the project is not clearly define at the beginning a “Cost Reimbursement” contract type can be chosen.

122. rabbani Says:
     October 26th, 2010 at 4:38 pm

     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.

     

     Samer H Skaik Reply:
     October 30th, 2010 at 6:53 pm

     hi Rabbani,

     I didn’t get your question. Do you mean what procurement strategy you may adopt for such prjocet?

     

     T.Yohannes Okubay Reply:
     December 26th, 2010 at 3:57 pm

     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.

123. graham Says:
     October 29th, 2010 at 12:12 pm

     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.

     

     Samer H Skaik Reply:
     November 9th, 2010 at 11:46 am

     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..

124. mohamederaky Says:
     October 30th, 2010 at 6:06 pm

     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

     

     Samer H Skaik Reply:
     November 9th, 2010 at 11:50 am

     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.

125. mohamederaky Says:
     December 9th, 2010 at 3:35 pm

     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

     

     Samer H Skaik Reply:
     January 2nd, 2011 at 3:05 pm

     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..

126. syed Says:
     December 22nd, 2010 at 12:29 pm

     icannot down any help?
     syed

127. RAVINDRAN Says:
     January 7th, 2011 at 5:25 pm

     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.

     

     Samer H Skaik Reply:
     February 9th, 2011 at 11:54 am

     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.

128. wisal Says:
     January 12th, 2011 at 7:51 pm

     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

     

     Samer H Skaik Reply:
     February 9th, 2011 at 12:01 pm

     Hi Wisal,

     It should consider the variation order as well.

129. Hamd Says:
     January 25th, 2011 at 12:55 pm

     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

     

     Samer H Skaik Reply:
     February 9th, 2011 at 12:05 pm

     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.

130. shoaib junaidi Says:
     February 2nd, 2011 at 8:37 am

     “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”

     

     Samer H Skaik Reply:
     February 9th, 2011 at 12:59 pm

     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.

131. yeshi Says:
     February 5th, 2011 at 11:29 pm

     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

     

     Samer H Skaik Reply:
     February 9th, 2011 at 1:13 pm

     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.

     

     yeshi Reply:
     February 23rd, 2011 at 12:52 am

     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

     

     Samer H Skaik Reply:
     March 1st, 2011 at 11:59 am

     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.

132. SMG Says:
     February 14th, 2011 at 1:44 pm

     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

     

     Samer H Skaik Reply:
     February 17th, 2011 at 11:12 pm

     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

     

     SMG Reply:
     February 17th, 2011 at 11:42 pm

     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

     

     Samer H Skaik Reply:
     February 21st, 2011 at 10:25 am

     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!

133. paulsaimon Says:
     February 21st, 2011 at 10:03 am

     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

     

     Samer H Skaik Reply:
     February 21st, 2011 at 10:38 am

     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..

     

     paulsaimon Reply:
     February 21st, 2011 at 8:39 pm

     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

     

     Samer H Skaik Reply:
     March 1st, 2011 at 11:50 am

     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.

134. Mathew Philip Says:
     February 24th, 2011 at 7:14 pm

     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.

     

     Samer H Skaik Reply:
     March 1st, 2011 at 11:33 am

     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.

135. sinawho Says:
     February 25th, 2011 at 8:38 am

     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!

     

     Samer H Skaik Reply:
     March 1st, 2011 at 11:44 am

     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.

136. sinawho Says:
     March 1st, 2011 at 5:11 pm

     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.

     

     Samer H Skaik Reply:
     March 16th, 2011 at 9:17 am

     You can find the guidance on how to prepare the EOT claim in CMGUIDE. You need to exert little efforts searching and I assure you that you will find what you are looking for.

     This article for example is a good one:
     http://cmguide.org/archives/28

     Regards.

137. Iftikhar Says:
     March 2nd, 2011 at 2:37 pm

     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.

     

     Samer H Skaik Reply:
     March 29th, 2011 at 6:29 pm

     Dear Iftikhar

     I am really sorry as your request falls beyond the scope of this service.

     Good luck

138. sinawho Says:
     March 8th, 2011 at 7:39 am

     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?

     

     Samer H Skaik Reply:
     March 16th, 2011 at 9:49 am

     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,

139. mdyousufali Says:
     March 29th, 2011 at 6:02 pm

     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

     

     Samer H Skaik Reply:
     March 29th, 2011 at 6:26 pm

     Yes you can. Refer to clause 52.3 (b).

140. mdyousufali Says:
     April 2nd, 2011 at 12:06 pm

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

     

     Samer H Skaik Reply:
     April 10th, 2011 at 6:22 pm

     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.

141. pappabear Says:
     April 5th, 2011 at 10:30 am

     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?

     

     Samer H Skaik Reply:
     April 10th, 2011 at 6:24 pm

     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.

142. paulsaimon Says:
     April 5th, 2011 at 11:12 am

     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

     

     Samer H Skaik Reply:
     April 10th, 2011 at 6:30 pm

     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.

143. IraSCiBLe Says:
     April 5th, 2011 at 2:55 pm

     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,

     

     Samer H Skaik Reply:
     April 11th, 2011 at 10:58 am

     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.

     

     IraSCiBLe Reply:
     April 14th, 2011 at 10:41 am

     Dear Mr. Skaik,

     Thank you for your answer, nevertheless in FIDIC 99 Guidance for Particular Conditions, it is stated that Clause 12 should be deleted. I’m of the opinion that as long as a fair determination on the valuation of variation is given, we dont need any BOQ or Method of Measurement is necessary. I also have to mention that the design will be 100% complete when we go to tender, therefore no remeasurement will necessary, except for the possible variations as you’ve stated. Also I’d really appriciate if you can provide a sample document in that respect.

     Kind Regards,

144. junaid_engr Says:
     April 8th, 2011 at 8:11 am

     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

     

     Liaqat Hayat Reply:
     April 11th, 2011 at 9:14 am

     Dear Mr. Samer,
     In response to Mr. Junaid’s query, I may add that the Employer’s Risk as defined in Clause-20.4 (h) has to be considered in response to his question. The flood risk are undoubtedly foreseeable if the site is not too remote from the natural stream/river and location plays an important role if the surrounding areas is of mountainous terrain specially with respect to flash floods. the possibility of flash floods is very much there but the damages as a result of this cannot be properly foreseen or insured. To sum up, the flooding due to breach of banks has to be covered in insurance policy of the Contractor for this site while flash floods if it happens, is most probably an Employer’s risk. This is my thought on the subject and you can further elaborate and give your view point.
     Regards,
     Liaqat Hayat

     

     Samer H Skaik Reply:
     April 11th, 2011 at 11:51 am

     Thanks alot Mr Liaqat for your valuable input. I really appreciate your inputs here from time to time.

     

     Samer H Skaik Reply:
     April 11th, 2011 at 11:47 am

     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

145. Prashant Lingayat Says:
     April 9th, 2011 at 3:26 pm

     Hello,
     I want to know if any forms , templates , documents are readily available for administration of a Cost Plus Percentage Contract.

     

     Samer H Skaik Reply:
     April 10th, 2011 at 6:32 pm

     Dear Prashant

     you can google it. I have seen some available stuff before on web against a reasonable fee.

146. avinash Says:
     April 11th, 2011 at 10:58 pm

     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

     

     Samer H Skaik Reply:
     April 13th, 2011 at 10:26 am

     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.

147. sinawho Says:
     April 19th, 2011 at 7:39 am

     dear samer:the contract conditions is FIDIC2006,AND we are entitled to suspension because of EMPLOYER’S DELAYED advance payment. it is more than 28 days pasts ,but engineers have not given us the approval or disapproval of the suspension, my question is :does this consist an ommision?
     or it is not necessary at all for the engineer to approve or disapprove this kind of suspension, since it is the contractual authorized suspension?

148. Abdul Says:
     April 21st, 2011 at 11:36 am

     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.

     

     Samer H Skaik Reply:
     April 26th, 2011 at 4:17 pm

     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.

149. jamesbaldesco Says:
     May 16th, 2011 at 3:55 pm

     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.

     

     Samer H Skaik Reply:
     May 16th, 2011 at 8:42 pm

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

     Regards

     

     Samer H Skaik Reply:
     June 11th, 2011 at 9:30 pm

     Hello James

     Always, you need to use the actual quantities from drawings to assess any variation. See other similar questions on this.

150. Tamkh Says:
     May 17th, 2011 at 1:10 pm

     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,

     

     Samer H Skaik Reply:
     June 11th, 2011 at 9:33 pm

     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.

151. Abdul Says:
     May 27th, 2011 at 6:44 pm

     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.

     

     Samer H Skaik Reply:
     June 11th, 2011 at 9:38 pm

     Hello Abdul

     The insurance should only cover the work, labour and equipment of the contractor doing the survey work. T

152. alhawary Says:
     May 28th, 2011 at 7:55 pm

     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.

     

     Samer H Skaik Reply:
     June 11th, 2011 at 10:05 pm

     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. paulsaimon Says:
     June 2nd, 2011 at 10:18 am

     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?

     

     Samer H Skaik Reply:
     June 11th, 2011 at 10:10 pm

     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..

154. tonyc83 Says:
     June 2nd, 2011 at 2:52 pm

     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?

     

     Samer H Skaik Reply:
     June 11th, 2011 at 10:49 pm

     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.

155. mohamederaky Says:
     June 3rd, 2011 at 3:46 pm

     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

     

     Samer H Skaik Reply:
     June 11th, 2011 at 11:07 pm

     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

156. lara Says:
     July 1st, 2011 at 10:47 am

     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

     

     Samer H Skaik Reply:
     July 1st, 2011 at 11:27 am

     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.

     

     lara Reply:
     July 4th, 2011 at 6:13 am

     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)?

     

     Samer H Skaik Reply:
     September 4th, 2011 at 7:23 pm

     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.

157. Abdul Says:
     July 9th, 2011 at 12:18 pm

     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

     

     Samer H Skaik Reply:
     September 4th, 2011 at 7:37 pm

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

158. Pallab Mukherjee Says:
     July 14th, 2011 at 11:27 am

     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.

     

     Samer H Skaik Reply:
     September 4th, 2011 at 7:43 pm

     Follow FIDIC red book 1987 or 1999 only. Silver book is used for MEP works designed by the contractor.

159. waltpw Says:
     August 5th, 2011 at 7:00 pm

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

     

     Tesfa Reply:
     September 3rd, 2011 at 11:07 pm

     Dear Waltpw,

     you cannot find method of measurment in FIDIC. It is not method of measurment..form of contract. However, the method of measurment can be found in your preamble of the BOQ. These should be normally be in the first page of you BOQ, when you prepare your Tender, you might have seen that. Please check again you Preamble which method of mearument was specified. If your method of measurment is CESMM3 for example, you can find you answer in Section-7 of the CESMM3, to clarify, if you catagorize in your BOQ the “Time-Related” commonly known as recurring items and the “Fixed charge” aka non-recurring, then it is straightforward to measure. simply prorate it to time which is length of the project equally. whereas, the fixed once, you will only be paid when expended.

     I hope i have asnwered you question.

     

     Samer H Skaik Reply:
     September 4th, 2011 at 7:49 pm

     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.

160. toonmole Says:
     August 12th, 2011 at 3:35 pm

     Dear Sir,

     We have a re-measure contract, while there is some ambiguity in the measurement rules we have demonstrated that our tender rate was based on the billed quantity. The billed quantity can be cleary demonstracted how it was achieved.

     Due to the ambiguity in the measurement rules the main contractor insists on only paying a reduced re-measure.

     However this reduction equates to a 42% reduction in the billed quantity and that one item(re-measured) represents a reduction of 25% of the original contract sum.

     Contractor says there is no grounds for a re-rate. Surely this is incorrect? Are there any guidelines for when re-rates should be applied?

     Thanks.

     

     Samer H Skaik Reply:
     September 4th, 2011 at 7:57 pm

     Please clarify the contract form you use to give you my feedback.

161. zaid1975 Says:
     August 22nd, 2011 at 12:43 pm

     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

     

     Tesfa Reply:
     September 3rd, 2011 at 11:55 pm

     Dear Zaid,

     Which FIDIC edition are you referring? please specify.

     For now i will assume 4th Ed FIDIC 1987 as amended-1992.
     Clause 39.1 & 39.2 can answer your request provided that you serve the proper notice. However, holding the payment is not a solution, rather specific notice as in these clauses might be helpful. deal case by case. I suggest you to pay the contractor his interim payment so that he can pay the subcontractors himself and proceed with the others work if you want to avoide disruption to the program while still applying you right as per the above two clasues. Besides, if you paid him in the previous payment for the section under issue, you might deduct reasonable amount as per Cluase#60.4 .

     you have already a performance bond and a retention if things goes wrong.

     I hope this can help you.

     T.yohannes

     

     Samer H Skaik Reply:
     September 4th, 2011 at 8:09 pm

     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.

162. aneesnayyar Says:
     September 4th, 2011 at 4:49 pm

     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

     

     Samer H Skaik Reply:
     September 5th, 2011 at 9:59 pm

     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.

163. Cawily Says:
     September 5th, 2011 at 5:18 pm

     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?

     

     Samer H Skaik Reply:
     September 5th, 2011 at 10:21 pm

     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.

164. funda Says:
     September 6th, 2011 at 1:26 pm

     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

     

     Samer H Skaik Reply:
     September 17th, 2011 at 8:49 pm

     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.

     

     funda Reply:
     September 19th, 2011 at 9:35 am

     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

     

     Samer H Skaik Reply:
     September 29th, 2011 at 9:06 pm

     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.

165. mme49 Says:
     September 7th, 2011 at 1:10 pm

     Dear Sirs,

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

     Please advise.

     Regards

     

     Samer H Skaik Reply:
     September 24th, 2011 at 4:00 pm

     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.

166. Cawily Says:
     September 7th, 2011 at 7:33 pm

     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.

     

     Samer H Skaik Reply:
     September 24th, 2011 at 4:10 pm

     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.

167. bkumarraja Says:
     September 10th, 2011 at 2:40 pm

     Sir,

     right now I am working for a Re measured Electrical Project. In this we have some different power cables. My question is for Payment purpose what length of cable I can ask for.

     I mean, being as a contractor I am directly measuring the cable that we used for the work from the site. But the consultant is saying we must measure from the drawing only. Please suggest me how can I proceed??

168. bkumarraja Says:
     September 10th, 2011 at 2:54 pm

     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?

     

     Samer H Skaik Reply:
     September 24th, 2011 at 4:38 pm

     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.

169. sinawho Says:
     September 16th, 2011 at 9:06 am

     “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”

     

     Samer H Skaik Reply:
     September 24th, 2011 at 9:22 pm

     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.

170. m_owies Says:
     September 17th, 2011 at 7:37 pm

     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 ?

     

     Samer H Skaik Reply:
     September 24th, 2011 at 9:26 pm

     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.

171. m_owies Says:
     September 27th, 2011 at 8:43 pm

     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

     

     Samer H Skaik Reply:
     September 29th, 2011 at 10:10 pm

     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.

172. lara Says:
     September 28th, 2011 at 12:49 pm

     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.

     

     Samer H Skaik Reply:
     September 30th, 2011 at 1:31 am

     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.

173. Renegade Says:
     October 13th, 2011 at 8:31 am

     Mr Samer H. Skaik:
     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

     

     Samer H Skaik Reply:
     November 2nd, 2011 at 12:39 pm

     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.

174. jaina_delima Says:
     October 24th, 2011 at 9:43 am

     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.

     

     Samer H Skaik Reply:
     November 2nd, 2011 at 12:44 pm

     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.

175. Nairy Says:
     October 31st, 2011 at 6:31 pm

     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.

     

     Samer H Skaik Reply:
     November 2nd, 2011 at 12:57 pm

     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

176. rahal Says:
     November 3rd, 2011 at 12:25 pm

     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

     

     Samer Hisham Skaik Reply:
     November 19th, 2011 at 8:51 pm

     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.

     

     rahal Reply:
     December 5th, 2011 at 1:54 pm

     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

     

     Samer Hisham Skaik Reply:
     December 9th, 2011 at 11:37 pm

     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.

177. sheiknazeer Says:
     November 9th, 2011 at 2:09 pm

     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.

     

     Samer Hisham Skaik Reply:
     November 19th, 2011 at 9:15 pm

     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.

178. sulfi_alimk Says:
     November 13th, 2011 at 7:26 pm

     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.

     

     Samer Hisham Skaik Reply:
     November 19th, 2011 at 9:30 pm

     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.

179. Nairy Says:
     November 21st, 2011 at 2:22 pm

     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!

     

     Samer Hisham Skaik Reply:
     December 9th, 2011 at 11:38 pm

     Simply, you need to mention the lump sum items in BOQ only.

180. TGeorge Says:
     November 24th, 2011 at 4:12 pm

     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.

     

     Samer Hisham Skaik Reply:
     December 10th, 2011 at 12:30 am

     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.

181. Nairy Says:
     November 24th, 2011 at 7:33 pm

     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?

     

     Samer Hisham Skaik Reply:
     December 10th, 2011 at 12:39 am

     Sorry Nairy,

     I have no clue about Lebanese law.

182. sray Says:
     November 25th, 2011 at 12:14 pm

     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?

     

     Samer Hisham Skaik Reply:
     December 10th, 2011 at 1:05 am

     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.

183. BENJ Says:
     November 27th, 2011 at 10:10 pm

     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?

     

     Samer Hisham Skaik Reply:
     December 10th, 2011 at 1:08 am

     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.

184. raju1965 Says:
     November 29th, 2011 at 5:55 pm

     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.

     

     Samer Hisham Skaik Reply:
     December 10th, 2011 at 1:10 am

     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.

185. minerva Says:
     November 30th, 2011 at 7:50 am

     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?

     

     Samer Hisham Skaik Reply:
     December 10th, 2011 at 1:22 am

     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.

186. minerva Says:
     November 30th, 2011 at 1:12 pm

     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 ?

     

     Samer Hisham Skaik Reply:
     December 10th, 2011 at 6:05 pm

     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.

187. JLW83 Says:
     December 7th, 2011 at 7:27 am

     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

     

     Samer Hisham Skaik Reply:
     December 10th, 2011 at 6:31 pm

     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.

188. npwsbandara Says:
     December 10th, 2011 at 11:20 pm

     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.

     

     Samer Hisham Skaik Reply:
     December 11th, 2011 at 11:42 am

     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.

189. rahal Says:
     December 17th, 2011 at 2:33 pm

     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.

     

     Samer Hisham Skaik Reply:
     January 13th, 2012 at 8:42 pm

     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.

190. samali Says:
     December 18th, 2011 at 9:51 pm

     Hello and many tkanks foe the quality of the topics.
     I would like have your opininion on the followings:
     We have a Lump Sum contract fixed price (non fidic). The employer requires that all engineering, procurement and constrcution process must be subject to his approval. This process already delayed the project significatly and cost the contractor lot of money. The contractor is doing his best efforts to mitigate/reduce the delay. Theoritcally the employer is exercicing his right but this impacting the project.
     The question is simply, can the contractor claim for extention of time due to unforseen heavy load of employer interfernces.
     thanks in advance

     

     Srinivas Reply:
     December 21st, 2011 at 12:03 pm

     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

     

     Samer Hisham Skaik Reply:
     January 13th, 2012 at 8:51 pm

     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.

     

     samali Reply:
     January 18th, 2012 at 3:40 pm

     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.

191. rahal Says:
     December 20th, 2011 at 3:40 pm

     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

     

     Samer Hisham Skaik Reply:
     January 13th, 2012 at 8:56 pm

     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.

192. Srinivas Says:
     December 21st, 2011 at 10:19 am

     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

     

     Samer Hisham Skaik Reply:
     January 13th, 2012 at 9:00 pm

     Thanks Srinivas for your kind feedback.

     JCT 2005 is available in the downloads.

     

     Srinivas Reply:
     January 17th, 2012 at 10:54 am

     Numerous Thanks Mr. Samer for uploading JCT under downloads section.

     Srinivas

193. ephraim abdissa Says:
     December 22nd, 2011 at 11:36 am

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

     

     Samer Hisham Skaik Reply:
     January 13th, 2012 at 9:05 pm

     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.

194. jason14 Says:
     December 31st, 2011 at 1:58 pm

     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.

     

     Samer Hisham Skaik Reply:
     January 13th, 2012 at 9:15 pm

     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.

     

     jason14 Reply:
     January 14th, 2012 at 9:52 am

     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.

     

     Samer Hisham Skaik Reply:
     January 22nd, 2012 at 2:31 pm

     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.

195. maqsdd Says:
     January 3rd, 2012 at 9:08 pm

     Dear Samer,

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

     Regards,

     

     Samer Hisham Skaik Reply:
     January 13th, 2012 at 9:09 pm

     Please give me more details about your contract type and which stage you are talking about to give a proper answer.

     

     maqsdd Reply:
     January 14th, 2012 at 7:28 pm

     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.

     

     Samer Hisham Skaik Reply:
     January 17th, 2012 at 4:23 pm

     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.

     

     maqsdd Reply:
     January 14th, 2012 at 7:30 pm

     TENDERING STAGE

196. maqsdd Says:
     January 3rd, 2012 at 9:11 pm

     Dear Samer,

     can the Contractor price in the preliminaries COST OF SNAG WORKS

     Regards,

     

     Samer Hisham Skaik Reply:
     January 13th, 2012 at 9:11 pm

     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.

197. jamesbaldesco Says:
     January 14th, 2012 at 4:24 pm

     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.

     

     Srinivas Reply:
     January 18th, 2012 at 11:47 am

     (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

     

     Samer Hisham Skaik Reply:
     January 22nd, 2012 at 2:41 pm

     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.

     

     jamesbaldesco Reply:
     January 24th, 2012 at 10:41 am

     Thanks for all your Answers Srinivas and Mr. Samer..

198. m_owies Says:
     January 16th, 2012 at 2:42 am

     Dear Mr. Samir
     My project is remeasure contract based on FIDIC 1987 4th ed. reprinted on 1992.The client sent use a letter instructing us to omit some items in BOQ and later we discovered that the client is going to carried out that omitted items by anthor contractor with a cheaper rates than ours, my question is : if we entitle to claim the client , what is the details and value of the claim we deserve ?

     

     Srinivas Reply:
     January 18th, 2012 at 2:10 pm

     (Mr. Samer let me express my point of view)

     Dear m_owies,

     According to Clause: 51.1 (b) of the FIDIC 1987 4th Edition Reprinted 1992 The Engineer has right to omit any such work (but not if the omitted work is to be carried out by the
     Employer or by another contractor). As your case the Engineer/ Client is exercising the power (which is not available to him under the Contract) to execute the omitted works through another Contractor is placing the Client in direct breach of Contract.

     You have right to ask Loss of Profit for the omitted items, by simply submitting a Negative Variation.

     If the Engineer fails to certify the same under Clause: 52.1 write to the Engineer under Clause: 67.1 that you are in disagreement with the above decision as client has acted in bad faith and therefore dispute the action done by the Client.

     Further request the Engineer to settle amicably under Clause: 67.2 for the Loss of Profit for such items. If this Still fails to reach an agreement on settlement, follow the course of Clause: 67.3, which is final and in my opinion the best available in the said form of Contract (provided the value you talk about is worth doing it).

     Mr. Samer I request you to take further if my views are different from yours please.

     Kind regards,

     Srinivas

     

     Samer Hisham Skaik Reply:
     January 22nd, 2012 at 2:48 pm

     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.

     

     m_owies Reply:
     January 22nd, 2012 at 6:50 pm

     Thank you v. much for your clear advice ,

     let’s go a little far for the same case ,what if the contractual completion date for that project had already expired while the contractor still didn’t even start to complete those omitted items , what will be the contror’ entitlement to claim in such condition?

199. m_owies Says:
     January 16th, 2012 at 2:47 am

     Dear Mr. Samir

     How can we deal with errors in BOQ like mistakes in description of UOM (contract is remeasure based on Fidic 1987 rev.in 1992)
     Thanks

     

     Samer Hisham Skaik Reply:
     January 22nd, 2012 at 3:17 pm

     Please give me more details about the mistake you refer to.

     

     m_owies Reply:
     January 22nd, 2012 at 6:59 pm

     for example UOM for ductwork for HVAC is shown in Item not in LM. nor SF and the estimator’s killing mistake he put his price for the item based on LM !! (Fidic 1987 rev. in 1992)

200. Ayman Eleish Says:
     January 17th, 2012 at 11:48 am

     Dear Sir,
     Can I get a variation order for the unit price due to drastic increase of an item in re-measered contract.

     

     Samer Hisham Skaik Reply:
     January 22nd, 2012 at 3:18 pm

     which form of contract do you use?

201. Kavitha Says:
     January 18th, 2012 at 5:33 pm

     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??

     

     Samer Hisham Skaik Reply:
     January 22nd, 2012 at 3:23 pm

     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.

202. Ayman Eleish Says:
     January 22nd, 2012 at 3:27 pm

     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,

203. mathewaugusty Says:
     January 26th, 2012 at 3:12 pm

     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?

Leave a Reply

You must be logged in to post a comment.