Design risk under FIDIC contracts: Navigating responsibilities and liabilities
Introduction The allocation of design risk is an important consideration
The Dangers of Employer Set Off in your FIDIC Contract: Suspension and Termination
If an Employer sets off certified but unpaid sums without following Sub-Clause 2.5, it may breach contract terms under FIDIC 1999. This article explores whether Employers can bypass the Engineer’s role and why the clause’s wording is crucial to both Contractors and Employers.
FIDIC Sub-Clause 20.5 – A Condition Precedent to Arbitration
The 1999 FIDIC forms of contract contain a number of
FIDIC Silver Book – Payments Due Shall Not Be Withheld… Really?
There is a substantial difference between the payment provisions of
2017 Suite: Commentary on Clause 01.15 – Limitation of Liability
Clause 1.15, previously in Sub-Clause 17.6 (1999 Edition), is now separated from Risk and Responsibility. It exempts parties from liability for loss, including loss of use, profit, or contracts, with exceptions for certain sub-clauses, notably Sub-Clauses 8.8 and 13.3.1(c).
2017 Suite: Commentary on Clause 14 -Contract Price and Payment
Clause 14 outlines payment, certificates, and release from liability. While the methodology remains unchanged, procedural adjustments may delay payments but aim for prompt claim resolution. Some changes benefit contractors: e.g. claims are addressed during or shortly after the contract period.
2017 Suite: Commentary on Clause 13 – Variations and Adjustments
Clause 13 clarifies the Engineer’s power to vary, allowing contractors to object to unforeseeable variations. Significant limitations include objections for health, safety, and environmental impacts. Variations must align with Employer’s Requirements, and supplemental agreements may be needed for significant changes.
2017 Suite: Commentary on Clause 11 – Defects After Taking Over
Clause 11 has been clarified, with detailed provisions for notices and periods, DNP for Parts, and clearer time limits. Changes include risk allocation, compensation for denied access, and limited liability for Plant damage. Some cross-references may cause confusion.
1999 Suite: Commentary on Clause 16 – Suspension and Termination by Contractor
Clause 16 addresses suspension and termination by the Contractor, including rights to suspend work, grounds for termination, cessation of work, and payment on termination. It specifies notice periods, conditions for immediate termination, and entitlements following termination.
1999 Suite: Commentary on Clause 12 – Measurement and Evaluation
FIDIC 1999 is a re-measurement contract, with the Employer bearing the risk of quantity variations. Clause 12 covers measurement, evaluation of rates, and valuation of omissions. It lacks a standard measurement method, which has been criticized.
1999 Suite: Commentary on Clause 09 – Tests on Completion
Clause 9 covers Tests on Completion, requiring the Contractor to give notice when ready to carry out Tests on Completion, addressing delays by either party, retesting after failure, and handling failures to meet contract requirements after retesting.
2017 Suite: Commentary on Clause 05 – Design
Clause 5 changes include specifying designer qualifications, moving part of Sub-Clause 5.1 to 1.9, changing "approval" to "No-objection" in Sub-Clause 5.2, and introducing a new procedure for addressing design errors in Sub-Clause 5.8.
FIDIC’S procedures for the appointment of a DAB need improvement
If the parties to a FIDIC contract cannot agree on
1999 Suite: Commentary on Clause 13.8 – Variations: Adjustments for Changes in Cost
Employers avoid paying more under existing contracts, but forcing unprofitable work risks contractor insolvency. Contractors now seek protection from price fluctuations, preferring short projects or cost-plus letters of intent. Cost adjustment mechanisms, like FIDIC 1999 Sub-Clause 13.8, may help.
Covid-19 and FIDIC contracts – what protections and entitlements?
Covid-19 has had huge consequences around the world and unfortunately
Damages at Large: Triple Point, FIDIC and the TCC
Triple Point was a case heard in the English Court of
FIDIC’S Golden Principles – holding back the tide?
FIDIC is concerned about its image. It says that heavily amending the FIDIC forms of contract impacts upon the FIDIC brand and that this is damaging FIDIC’s reputation. It seeks to address this with the introduction of five Golden Principles. But the Golden Principles are merely aspirational; they are not binding and have no contractual effect. Does this render them a pointless gesture ‘trying to hold back the tide’?
FIDIC contracts – What protection do they give contractors for employer financial problems?
In all construction contracts, one of the central principles is the Employer’s obligation to pay the contract price. The Contractor will be wary about the Employer’s financial standing and ability to pay and concerned to ensure that payments are made on time and that effective remedies are available in case of late or non-payment. The FIDIC standard forms of contract contain provisions dealing with these aspects.
1999 Suite: Commentary on Clause 08 – Commencement, Delays, and Suspension
Clause 8 covers the start of works, time for completion, delays, extensions, and suspension of works. It includes provisions for commencement, completion, progress, delay damages, and suspension, with updates from the 4th Edition Red Book.
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.