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.
The 1999 FIDIC forms of contract contain a number of
Opinions on enforcing 'binding' DAB decisions vary. Some arbitrators support enforcement, while others, including the Singapore Court of Appeal, oppose it. This article considers case law addressing both sides of the argument and the issues that they raise.
If the parties to a FIDIC contract cannot agree on
Clause 20 covers claims, disputes, and arbitration. It includes procedures for Contractor claims, appointing a Dispute Adjudication Board (DAB), handling disputes, amicable settlement, arbitration under ICC rules, and actions when a DAB decision is not complied with or absent.
FIDIC ‘launched’ the FIDIC 2022 reprints at the FIDIC International Construction Users’ Conference 2022, in London. The reception to the changes was mixed – some embraced the clarity; others questioned the significance and cost. This article draws your attention to 10 of the key areas of change in respect of the FIDIC Red Book 2017 including the definition of Claim, matters to be agreed or determined, the definition of Dispute and Exceptional Events.
The FIDIC 2017 forms first appeared at the December FIDIC Users’ Conference four years ago. No one has suggested that the FIDIC 2017 forms of contract did not rectify some of the problems in the FIDIC 1999 forms, and in Edward Corbett’s articles,[1] ‘Cherry Picking FIDIC 2017,’ and ‘FIDIC 2017 – First Impressions of the 3-Kilo Suite’, he considered some of these changes. This new suite of contracts had, at best, a lukewarm reception when they were first reviewed, with some commentators complaining about the length of these new contracts and that the contracts had not taken account of criticisms that had been made by reviewers. This article looks at the twelve worst ‘gifts’ that FIDIC gave to us for Christmas 2017.
Could provisions in FIDIC contracts giving relief for ‘Force Majeure’ or ‘Exceptional Events’ provide relief to contractors suffering as a result of price escalation? 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 Covid-19 pandemic and the Russo-Ukrainian conflict.
Up until the spring of 2020, a FIDIC 1999 Sub-Clause 13.7 [Adjustments for Changes in Legislation][1] claim was just one of many issues to be resolved, for example, in a delay and disruption claim or a Cost claim. However, the focus it receives in the context of Covid-19 is drastically different. Many in the industry are using the changes in legislation provision to seek financial compensation in a situation that would otherwise potentially only attract an extension of time.[2] Awarding Cost for Covid-19 events regardless of the circumstances may seem to some (Contractors mostly, though there are Employers and Engineers who agree) like the appropriate thing to do, but whether it is correct according to the Contract is a different question.
In March 2019, in the English Court of Appeal, Sir
A contract may require a party giving notice of a claim to specify the contractual or legal basis of that claim in the notice (or the supporting particulars). What if that party states a contractual or legal basis for the claim but later (perhaps with the benefit of additional information or because of advice from its lawyers) changes its mind or wants to include further contractual or legal bases? This was considered by the Hong Kong Court of Appeal in Maeda Corporation and China State Construction Engineering (Hong Kong) Limited v Bauer Hong Kong Limited [2020] HKCA 830. It found that a subcontractor could not change the contractual basis for its claim once the time period for providing such notice had expired. What, if any, impact will this decision have on the FIDIC forms of contract?
An issue that often arises in international arbitrations involving the FIDIC forms of contract is whether a claimant's failure to: (a) go through the dispute resolution provisions; or (b) comply with a time-bar clause gives rise to a question of admissibility or jurisdiction. Put another way, if a claimant has failed to issue a notice of claim within 28 days or failed to refer a dispute to a DAB, does the arbitral tribunal have jurisdiction to make an award on the merits or should the arbitral tribunal make an award stating that it lacks jurisdiction?
Covid-19 has had huge consequences around the world and unfortunately
Is FIDIC’s new Emerald Book overly contractor-biased or does it offer pragmatic risk allocation for underground works? This article compares its benefits and risk distribution with the unamended FIDIC Yellow Book, especially regarding employer risks in claim-prone areas.
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.
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.
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.
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.
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.
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.
