Cherry Picking FIDIC 2017
Much has been said about the new Red, Yellow and Silver Books 2nd Editions launched by FIDIC in December last year. The most obvious comment has been about their size, almost 50,000 words, which is some 60% longer than the 1999 forms. Although the 1999 forms were not perfect, most regular users seem to be agreed that they did not need 20,000 words to fix the issues. This consensus led this author to attempt to cherry-pick the good bits from the 2017 forms and to propose amendments to add the good ideas to the 1999 forms. The amendments apply to all three forms unless it is indicated otherwise.
Fitness for Purpose Højgaard and FIDIC’s Yellow Books
MT Højgaard is an important English case, considering fitness for purpose obligations in design-and-build contracts. This article examines the Supreme Court’s analysis of a fitness for purpose obligation in Højgaard and whether it would be applied to FIDIC’s Yellow Book contracts.
Variation Provisions in the FIDIC Yellow Book 2017
Much has already been written concerning the new FIDIC forms of contract published in December 2017. They are approximately 50 % longer and sought to set out the various procedure in much greater detail with the object of both encouraging good practice and reducing the scope for disputes. Numerous minor amendments have also been made. The purpose of this article is to look in more detail at the provisions dealing with Variations, these being amongst the most frequently scrutinised in practice.
Unintended Consequences of the FIDIC 2017 Clause 20.1 Claims Classification System
FIDIC’s 2017 editions introduced a new Claims management system in clause 20 that channels Claims through two very different procedures. One of them is very simple and involves almost no risk whereas the other will require investment of significant project resources, will take the parties a considerable amount of time to resolve and carries fatal consequences if not followed properly. It has therefore become a priority for anyone handling this Claims management system to understand how clause 20.1 sorts the different types of Claims and to recognise that the classification scheme is not as straightforward as the wording of the Contract suggests, as explored in this article.
1999 Suite: Commentary on Clause 14 – Contract Price and Payment
Clause 14 covers payment aspects, including interim and final certificates, advance payments, retention monies, and the cessation of the Employer’s liability. It outlines the process for monthly payment applications, final settlement, and the Contractor's rights if payments are delayed.
1999 Suite: Commentary on Clause 03 – The Engineer
Clause 3 outlines the Engineer's duties and obligations, including acting for the Employer, delegating authority (but not Determinations), issuing instructions, and handling Variations. It also covers Engineer replacement and making fair Determinations after consulting both Parties.
FIDIC 1999 Upgrade Launched
Corbett & Co. has published its selection of the best bits of the FIDIC 2017 2nd Editions adapted for use with the 1999 forms. With many people put off by the 50,000+ words of the new editions, the FIDIC 1999 Upgrade will permit users to benefit from FIDIC’s new ideas and improvements.
2017 Suite: Commentary on Clause 21 – Disputes and Arbitration
Clause 21 introduces a standing Dispute Avoidance/Adjudication Board (DAAB) instead of an ad-hoc DAB. The DAAB is appointed at the outset, assists in dispute avoidance, and its decisions are binding. The amicable settlement period is reduced to 28 days.
2017 Suite: Commentary on Clause 20 – Employer’s and Contractor’s Claims
The new Clause 20 distinguishes between main Claims, which follow a strict procedure, and other Claims, which are determined by the Engineer without strict procedural requirements, starting from the disagreement between parties and requiring only a Notice of Claim.
2017 Suite: Commentary on Clause 18 – Exceptional Events
Clause 18 replaces "Force Majeure" with "Exceptional Events," aiming for clarity in civil law jurisdictions. Strikes and lockouts are now distinct from riots. The clause maintains natural catastrophes and clarifies that invoking it results in contract termination.
2017 Suite: Commentary on Clause 16 – Termination by Contractor
Clause 16 introduces new grounds for suspension and termination, including non-compliance with binding decisions and non-receipt of Commencement Date Notice. It addresses corruption, and clarifies termination grounds and procedures. Contractors gain protection against financial consequences and can claim profit loss.
2017 Suite: Commentary on Clause 15 – Termination by Employer
Clause 15 introduces new grounds for termination: non-compliance with a binding Engineer’s Determination or DAAB decision; and maxing out Delay Damages (actual deduction not necessary). Uncertainty remains if EOT is granted post-termination, potentially affecting the legality of termination.
2017 Suite: Commentary on Clause 10 – Employers Taking Over
Clause 10 changes include express references to As-Built Records, Manuals, and Training for Taking Over, a Notice of No-objection requirement, deemed Taking Over without these Notices, immediate issuance of Taking-Over Certificates, and a 14-day prevention period.
2017 Suite: Commentary on Clause 09 – Tests on Completion
Contractors must prepare a detailed test programme reviewed by the Engineer. Clause 9.2 addresses delayed tests, applying Clause 10.3 for undue delays. Clause 9.2 adds procedures, including three Notices. Clause 9.4 expands failure criteria to include section rejection, complicating recovery under Clause 13.3.1.
2017 Suite: Commentary on Clause 08 – Commencement Delays and Suspension
Clause 8 changes include enhanced Programme requirements, Advance Warning mechanism, no Sub-Clause 20.2 notice for extension due to Variation, further definition of adverse climatic conditions, acceleration methods under Sub-Clause 13.3.1, and a cap on Delay Damages lifted for severe misconduct.
2017 Suite: Commentary on Clause 06 – Staff and Labour
Clause 6 is similar to the 1999 version but adds Key Personnel, strictly regulated by the Engineer. Other changes include clearer employment laws, notice for work outside normal hours, enhanced health and safety roles, and improved record-keeping.
2017 Suite: Commentary on Clause 03 – The Engineer
The main changes in Clause 3 are that: the Engineer may exercise its authority without the Employer's consent under Sub-Clause 3.7; and the Engineer must act “neutrally” under Sub-Clause 3.7. The intention is that the Engineer treats both Parties fairly.
2017 Suite: Commentary on Clause 02 – The Employer
Clause 2 now comprises 6 sub-clauses. New provisions, 2.5 and 2.6, have been introduced. The obligations and consequences remain unchanged. In Clause 2.4, the Employer can now specify financial arrangements, and the Contractor can request evidence under specific conditions.
FIDIC 2017 – First Impressions of the 3-Kilo Suite
FIDIC has launched the Second Editions of the Red, Yellow, and Silver Books, now over 50% longer than the 1999 forms. Key updates include more prescriptive processes, new time-bars, enhanced Dispute Boards, and a separate chapter on Disputes and Arbitration.
1999 Suite: Commentary on Clause 19 – Force Majeure
Clause 19 covers Force Majeure and release from performance, with broader definitions than typical laws. It prescribes detailed insurance requirements, reducing flexibility. The Contractor bears most obligations, necessitating careful amendments and professional advice to avoid misunderstandings and ensure proper incorporation into contracts.