‘Taking-Over’ in the FIDIC Red Book 1999: Common Problems
Disputes in respect of taking-over are not unusual in economically challenging environments. Employers may be in no hurry to take responsibility for the finished project, release retention monies and/or relinquish entitlement to delay damages. Contractors will want to finish as quickly as possible, reduce/end site costs and/or start the Defects Notification Period. Introduction In the FIDIC forms of contract, a Taking-Over Certificate marks the date that the Works are handed back to the Employer. The Employer has no right to use the Works until a Taking-Over Certificate is issued.[1] FIDIC 1999 provides for three broad categories of Taking-Over Certificate: "Taking
FIDIC Dispute Board Decisions: Late for a Very Important Date?
A FIDIC dispute board has just 84 days to give a decision, which is not very long. What happens when a FIDIC dispute board (DAB or DAAB) fails to deliver its decision on time and neither party serves a notice of dissatisfaction? The FIDIC dispute board and its decisions FIDIC's Red, Yellow and Silver books each contain a tiered dispute resolution procedure which includes adjudication by a dispute board (a Dispute Adjudication Board or 'DAB' in the 1999 books and a Dispute Avoidance/Adjudication Board or 'DAAB' in the 2017 books and 2022 reprints). The contractual agreement between the parties and
FIDIC Green Book 2021 – Short and Simple?
As one of the drafters of the Green Book 1999, the author of this article is biased in favour of the Green Book 2021. Despite that, it seems a pity that the Green Book 2021 did not get its own colour and title, such as the Intermediate Form of Contract. There is room in the market for both an updated short form and an intermediate form. The stand-out feature of the Green Book 2021 is the Prolongation Cost provision. This liquidates the Contractor's entitlement. This is a simple and attractive solution to an often-complex question but raises some questions: -
As simple as it seems? – an analysis of the prolongation costs clause in the FIDIC Green Book 2021
This article reflects on the introduction of an automatic contractual mechanism for calculating prolongation costs into the Green Book 2021 and will consider whether it will remove the expense of experts and lawyers from the process of claiming prolongation costs. Please click the button below to read the full article.
Risks in the Construction of Hydropower Projects: Unforeseen Ground Conditions under FIDIC
The construction of hydropower projects is highly dependent on the ground conditions, for both the design and for the construction of dams, tunnels and power stations. But the unique site-specific characteristics of each hydropower project means that unforeseeable ground conditions are common. Mother Nature has a habit of playing tricks and serving up the unexpected. No matter how many bore holes an employer sinks pre-tender, it is inevitable that there will be some ground information missing. How can this risk be mitigated and distributed in a cost-effective way? This article considers the approaches of the FIDIC standard forms, including the
Panther Pounces on Late Notice: Dubai court disagrees with Obrascon on time-bar under Sub-Clause 20.1 of FIDIC 1999
Contractors who fail to issue their FIDIC 1999 Sub-Clause 20.1 notices on time are easy prey. In a brutal decision for contractors, the Dubai International Financial Centre (DIFC) Court of Appeal has revisited the question as to when a Sub-Clause 20.1 notice should be given (in particular, when the 28-day notice period starts to run) and has challenged the findings of Mr Justice Akenhead in Obrascon Huarte Lain SA v Attorney General for Gibraltar [2014] EWHC 1028 (TCC). In this article, I review the decision in Panther Real Estate Development LLC v Modern Executive Systems Contracting LLC [2022] DIFC CA 016
The Role of the FIDIC Observer in ICC Arbitrations on FIDIC contracts
The ICC informed a recent FIDIC Conference that draft awards dealing with FIDIC Contracts were routinely passed to the 'FIDIC Observer' for comment. The stated purpose being to ensure consistency of awards on FIDIC. In this article, I discuss the role of the FIDIC Observer in reviewing draft awards dealing with FIDIC contracts. I ask whether this complies with the ICC's Rules or could give grounds for challenge; and whether consistency in the absence of published awards is a desirable objective. Click the link below to read the full article.
Be Nice to the Kid in the Corner: Brussels Cour de Cassation provides Charter for Overworked and/or lazy arbitrators
In a recent and unique case, the chair of an ICC Arbitral Tribunal admitted that his Administrative Secretary drafted lists of questions for him to ask the technical experts; and also drafted the decision-making parts of the award. It was argued before the lower Belgian courts that such conduct constituted an unlawful delegation of authority by the arbitrator. Please find attached my full article with details of the Belgian court's decision and the implications for users of ICC arbitration. Click the link below to read the full article.
Soaring global construction costs under FIDIC: whose risk?
This article first appeared in IBA Construction Law International, Vol 18 No 1, March 2023. It is well documented that construction and engineering projects around the globe are being affected by extreme and sometimes unprecedented price escalation. This is for many reasons including the ongoing effects of the Covid-19 pandemic and the Russia-Ukraine war. In this article, we look at FIDIC’s allocation of risk – in particular, the ‘Adjustments for Changes in Cost’, ‘Force Majeure’ and ‘Exceptional Events’ provisions. Type of contract The type of contract usually informs as to which party takes the risk (or benefit) of price fluctuations:
Can an Employer Instruct an Airport Instead of a Road?
What is the point of a variations clause? It is almost inevitable that, however well thought through a construction project is at design stage, when it comes to be built, there will be a need for some variations. At least under English law an employer is not entitled unilaterally to vary the works unless the contract contains an express right to do so. The purpose of a “variation clause” is to enable an employer to avoid having to enter into a new contract with the same contractor, or perhaps another contractor, to have him perform a variation. If the employer