8/11/2019 Yellow FIDIC GC SC 14 - Application of Delay Damage http://slidepdf.com/reader/full/yellow-fidic-gc-sc-14-application-of-delay-damage 1/15 ADS YOU MAY BE INTERESTED IN OSV Africa 2013 Who will you meet at Offshore Support Vessels Africa 2013? Download brochure › Recruitment from India IMR recruit Manpower for Oil, Engineering, Energy, Mining Sector Worldwide. › Hoteliers Only: Survey Fill in this 4 question-survey and get to see other hotels' results. › Latest Activity Mohammed Fadlalla and 4 more commented on: written mistakes in Contracts : if the Contractor had a mistake (obvious one) in item price in BOQ . FIDIC 1999 red book . What should the Consultant do? Does the Contractor has the right to claim? 10 minutes ago Mohammed Fadlalla likes this comment by Chris Nixon written mistakes in Contracts : if t he Contractor had a mistake (obvious one) in item price in BOQ . FIDIC 1999 red book . What should...: If the contractor could establish that the price in the tender was SDG 60,000 and the bid was determined on this, and then... 11 minutes ago Prakash Rao and 4 more commented on: Apply LD 54 minutes ago Subgroups Non-FIDIC Contract Discussions 5 members MBA without Bachelor - 18 Months Top Ranked British MBA in Switzerland Online Studies ! Follow Dragan Like (1) Comment (45) Unfollow Reply Privately2 months ago Yellow FIDIC GC SC 14.11 Dragan RAKO Principal Engineer at SAFEGE Croatia Contractor submitted DRAFT final statement - the Engineer disagrees with some parts of DRAFT, one of the issues is determined Delay Damages (DD) pursuant to GC SC 3.5 which is disputed by the Contractor - conclusively, Contractor refuses to change his DRAFT, so the Engineer will have to issue Interim Payment Certificate for the agreed parts of the DRAFT. My question is - is DD agreed part (since already determined by the Engineer) or should DD be excluded from the IPC, until resolved by the DAB or Arbitration? Please note that GC SC 14.11 makes no reference to GC SC 14.6. Thanks in advance Comments Like Reply privatelyFlag as inappropriate 1 month ago Ibrahim Izzldin Cost Engineer at Newtech Consulting Group I think the answer mainly depends on what considered as agreed part of draft final statement, I try to analysis the case as fallows: Scenario 1: if the Contractor agreed to apply "Delayed Damages" in accordance & compliance with the Contract, then the Interim Payment Certificate of the Draft final statement shall include the same as agreed part. Scenario 2: if a dispute exists regarding "Delayed Damages", the aforesaid IPC shall be issued to the Employer exclusive of DD. If the dispute later resolved under Sub Clauses 20.4 & 20.5 (DAB's decision) or Amicable Settlement, then the Contractor shall prepare the Final Statement in accordance with the outcome. Therefore, as per your comment, the dispute in relation to "Delayed Damages" is exist, as such it is not agreed part so I do recommend not to include the Engineer's determination for DD in the IPC of the draft final statement until this issue has been resolved. I hope this value and let us wait for another comments for different interpretations Regards, Like Reply privatelyFlag as inappropriate 1 month ago Dragan RAKO Principal Engineer at SAFEGE Croatia Dear Mr Izzldin, thanks for the comments. Please note that GC SC 2.5 paragraph 4, states that "This amount (i.e. DD in this particular case) may be included as a deduction in the Contract Price and Payment Certificates." Obviously there is minor discrepancy between the GC SC 2.5 and 14.11 provisions. Any comment? Top Influencers in this Group Prakasit Naksom vongkul Contract Manager at Campbell Kane (Thailand) Limited Follow Prakasit See all members F e e d b a c k Home Profile Network Jobs Interests Business Services Upgra 4 Search groups...
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Yellow FIDIC GC SC 14 - Application of Delay Damage
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the Contractor still put all amount he claims, i.e. A) value of works done in accordance with the
Contract and B) amounts he considers are due to him (Claims).
Since the Engineer cannot accept (all) amounts requested by the Contractor, and there obviusly
cannot / will not be any agreement on the issue between the Contractor and the Engineer,
pursuant to GHC SC 14.11 the Engineer has to issue Interim Payment Certificate for the agreed
parts of the Contractor's draft final statement.
And here lies the problem, since DD's do not constitute part od Contractor's draft final statement -
therefore, the question remains, should 3.5 determined the DD's be or not be included in
Engineer's 14.11 IPC?
Additionally, since it is obvious that the dispute exists, Final Payment Certificate will be (if any)issued only when all disputes are resovled either by the DAB or Arbitration.
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Cristiana Roscoiu
Contract manager at Romanian National Company of Motorways and National Roads (RNCMNR)
As I previous said, as long as it exists an Engineer's Determination as per SCL.3.5,2.5, and 8.7, it
has to be put in practice (DD in the Payment Certificate ) even one/both Parties is/are dissatisfied
by it, until the matter will be settled in the DB or Arbitration.
The Certificate has to be Final Certificate that is no longer an interim one (IPC) as you mentioned
in the para 5.
Besides the matter DD in the Final Certificate, I guess that the DAB has to be appointed as per
the SCL.20.2.
Like (1) Reply privately Flag as inappropriate 1 month ago
Andy Reid
Post-contracts QS and Contractor
IPC = INTERIM Payment Certificate.
The Eng. can issue his IPC based on his, the Eng.s fair evaluation. If it EXcludes the items under
dispute, that's what an IPC can do. If, for example, the next day the items disputed are then
agreed, with say one remaining item still in dispute, the Eng. can issue a further IPC. The final
Certificate will remain outstanding until the last item is resolved...
Now let's see what this comment stirs up...?
Cristiana Roscoiu likes this
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Dragan RAKOPrincipal Engineer at SAFEGE Croatia
Dear Mr Reid
Please note that my original question relates to 14.11 IPC, not "usuall" 14.6 & 14.7 IPC.
14.11 IPC deals with the amounts requested within the Contractor's draft final statement but finally
agreed between the Engineer and the Contractor.
Since 3.5 determined Delay Damages are disputed by the Contractor, the question remains - can
DD's as such be included in 14.11 IPC?
Like Reply privately Flag as inappropriate 1 month ago
Andy Reid
Post-contracts QS and Contractor
DDs should be deducted - see Cristiana's comment above.
However, I would issue an IPC, not a Final Certificate.
A final certificate customarily means full and final payment of all monies outstanding - and by the
contractor accepting a 'Final Certificate' this could be interpreted as accepting the final figures. In
this case, as there are items in dispute, I do not see this as being possible until they are all
resolved one way or t'other...
Paul Clarke
Team Leader at Safege
I think the comments in response to the issue all generally indicate confusion as to the nature of
damages and their relation to the IPC. First ly there is no reference in clause 8.7 to any decision
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required from the Engineer under 3.5. The Engineer DOES NOT determine whether or not DDs are
paid. 8.7 states the "... Contractor shall ... pay ..." and the Employer has an entitlement to be
paid the damages. The only condition is the provision of a notice - note only the provision of a
notice - to the Contractor under 2.5. The value of the damages is automatically determined by
comparing the contract completion date (see comment below) with the date of taking over the
works given on the taking over certificate to arrive at the delay so there is nothing for the Engineer
to determine.
The IPC procedure, in particular for the final IPC, is to determine and agree the value of the Works
in response to a Contractor's statement. The value of the Works arises from the net effect of
measurement and valuation, including variations, and the assessment and valuation claims
whether they are made by the Contractor or the Employer. The damages are not part of this
procedure.
The value of any damages may obviously be affected by a clause 3.5 decision where such adecision changes the time for completion and therefore the completion date. It should also be
born in mind that a final IPC should not include deductions as the advance payment should have
been recovered and the final IPC should include the payment of outstanding retention.
Where there outstanding disputes at the time of the final IPC - that is clause 3.5 decisions which
are contested by one of the parties to the contract that have not been resolved by a DAB or
arbitration procedure - then a further interim IPC should be issued for the full value of the agreed
Works - clause 14.11 (which should include agreed variations, claims etc.)
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Cristiana Roscoiu
Contract manager at Romanian National Company of Motorways and National Roads (RNCMNR)
It is known that the DB/and especially the arbitration are long lasting processes.
As also Andy says earlier, I guess it has to be issued rather an IPC than the final Certificate
because the works have to be certified and paid in the due time. But at the same time I would like
to know why to not include what the Engineer determined in this IPC as long as it exists a valid
fair Determination?
SCL. 3.5 states that:
..” Each Party shall give effect to each agreement or determination unless and until revised under
Clause 20 (Claims, Disputes, Arbitration)
I think, next, when the Final Decision will be obtained (after the ending of of DB,arbitration) all the
final matters may be last settled in the final certificate.
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Andy Reid
Post-contracts QS and Contractor
All factors, AT THE TIME OF THE VALUATION/CERTIFICATE (excuse the caps, only way to
highlight something) must be used to calculate the value of the works, and this includes the
deduction of DDs that are valid AT THAT TIME.
(As a draft final account is mentioned, no need to cover monthly values here so...) if subsequently
they are reduced, increased, etc., due to a resolution of the dispute(s) underway, then a further
IPC could be issued, until such time as the final account is agreed and settled; and when a Final
Certificate would be issued (though depending upon terms not necessarily paid in full at that time
- contracts vary).
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Paul Clarke
Team Leader at Safege
Please state where in the contract you have found a clause that defines the DDs as a deduction
or a clause that the defines DDs as part of the valuation of the Works. Also use of the phrase "All
factors" is misleading. Words in the CoC have very specific meanings. DDs are not part of the
dispute procedure. The Contractor has an obligation to pay the DDs subject to the required noticebeing given by the Employer. Note that the Employer may choose not to issue such a notice for
his own reasons. DS also are not part of the valuation of the "Works". The final IPC is issued in
response to a Contractor's statement in which he should detail all monies to which he believes he
is entitled. The DDs are not part of this procedure but have there own procedure - brief as it -
defined in clauses 8.7 and 2.5. It is the Employers choice - subject to notice - to deduct DDs from
any money certified as due to the Contractor in the IPC.
Cristiana Roscoiu
Contract manager at Romanian National Company of Motorways and National Roads (RNCMNR)
Dear Paul,
I totally agree with you that the Employer has an entitlement to be paid the damages if his notice
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under the SCL.2.5 exists . Then again, the notice is mostly not enough because the matter is not
so simple.
Would that if the damages to be automatically determined by comparing the contract completion
date with the date of TO of the works…
From my experience, the reasons which conducted at the exceeding of the Time for Completion
are multiple and its appreciation is not a quite simple thing (failures attributable to the Contractor
or /and to the Employer - i.e late possess ion of the site/sectors, change in design, different
problems which occurred during the working period..) That why the both Parties have to give to the
Engineer all their arguments in order to substantiate as well as they can the claims/reject the
claims, and the Engineer has to be able to make a really fair Determination.
This document has to be put in practice (could it be otherwise than within the IPC?) until thematters will be finally settled in the DB/ ICA.
So, in Rako’s case I st ill believe that in addition with the executed works (quantities) that have to
be paid to the Contractor in due time, also the matters which the Engineer already determined
have to be included in the IPC (not yet the final certificate) and that is no need the DD to be in the
Contractor’s statement (?) in order to be count in the IPC.
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Andy Reid
Post-contracts QS and Contractor
Ah Paul,
Read Cl. 14.6.b) & 14.11
I did not say DDs were defined as a deduction; nor that the contract specifically states that DDs
are part of the value of the works (actually definitely not 'value' as such)
What I did say (though badly put in my previous post) is that the Eng. must take into account all
factors to be considered at the time of his valuation in order to issue his certificate. DDs are one
such factor. If at the time of his valuation, DDs were due, then the Eng. would not be doing his job
if he failed to deduct them.
If, subsequently, it is found that DDs were/are not to be deducted, then they should not be AT
THAT TIME (here in caps, no other way to highlight) & (I.e the next valuation - which could still be
an IPC if there are still further items outstanding/in dispute and not yet finalised!)
Delete 1 month ago
Hashim Muhammud Bashir
Senior Planning Engineer at KEO International Consultants
Dragan,
I believe your confusion is whether a Contractor intimating 'his decision' to dispute a 3.5Determination related to 2.5 Employer's Claim (in this case for 8.6 Delay Damages) should be
considered in 14.11 Final Payment Certificate as disputed item.
IMHO, as far 199 YB is considered, it does not.
Because, as per 1999 Red & Yellow Books a 3.5 Determination made by the Engineer is binding,
unless and until "revised" under the dispute resolution procedures in Clause 20.
[Note that this is not the case in Silver Book. In Silver Book if the Contractor issues a 'notice of
dissatisfaction' within 14 days from the 3.5 Determination made by the Employer, the
determination is of no effect]
Also, referring to your original question regarding DAB & Arbitration.
Please note that the DAB (20.4) or amicable settlement (20.5) might result in a Final Statement
(as stated in the last para of 14.11). Whereas the Arbitration might end up in a way that the award
itself will be enough and no Final Statement is necessary. [This is to just point out the possible
difference between their outcome].
In your case, I couldn't understand one issue though. Since the Engineer had issued his 3.5
Determination, why was this amount not deducted in the previous IPCs (14.6) or at least in the
Statement at Completion (14.10)? Why is it delayed until the Final Statement (14.11)?
The above make me think whether the Engineer is NOT 100% sure about the Determination or the
Determination itself was not fair! If that is the case, then I would recommend to play safe by going
for an IPC (as Andy pointed out), thus not deducting the DD. (However, make sure that the
Employer will have enough money with him to make that deduction later on!)
Otherwise, if the Engineer is 100% sure about the Determination, you can proceed as Cristiana
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Andy Reid
Post-contracts QS and Contractor
Thanks Hashim, you dealt with that better than I could!
And great that you mentioned Cl. 14.13 - which reinforces my argument about ALL factors
affecting a valuation/certificate!
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Paul Clarke
Team Leader at Safege
Hashim
My last post included a quotation - please read it. This original issue in this thread was whether or
not DDs should be included in an IPC. The legal opinion quoted clearly confirms that they should
not. Furthermore it confirms that the Employer has an indisputable right to require the Contractor
to pay the DDs subject only to the provision of a notice. Note that the "procedure under 2.5" is
fully qualified in 8.7 by stating only that a notice is required. No 3.5 determination is required for
the DDs to be paid. If you wish to continue to contest information presented from qualified legal
opinion given by experts on FIDIC conditions please do so but at your own risk.
The issue of DDs will be affected if at the time of issue of the IPC the time of completion is in
dispute, that is a c lause 3.5 decision has been taken to the DAB or arbitration. The Engineer maywell have determined that a Contractor's claim in relation is unfounded, even frivolous, but if the
Contractor has decided to dispute the decision it remains unresolved.
The value of damages is, or should be, provided in the special conditions. The comment I made
was that the Engineer is entirely unable to confirm whether or not the damages are appropriate
and there are many instances of this value being contested legally. This is not a case of
applicable but general contract law.
Please read the quotation
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Andy Reid
Post-contracts QS and Contractor
As the status of all EoT is not clear, the statement made in the original post s tands: " is DDagreed part (since already determined by the Engineer)" and thus the DD has already been
determined by the Eng. and thus must form part of the Eng.s certificate (as stated previously it is
not 'value' per se). If the Eng fails to deduct the determined DD, he is not performing his duty.
That the DD may subsequently be overturned through due process, AT THE TIME OF THE
CERTIFICATE, they must still be deducted.
Further your last para above. It is NOT up to the Eng to determine if the amount of damages is
appropriate - they are already agreed as per the contract and with a max. cap. If the amount is in
dispute, and the contractor feels that they are not appropriate, then he may dispute their
application and/or the amount.
The law may or may not change the amount, the law may or may not change the determination
that they are payable; but until such time as the law has made its decision, the Eng.s
determination stands.
Andy Reid
Post-contracts QS and Contractor
Also re: your quote. Agreed, the DD does not form part of the value of the work (that would be like
saying that the insurance and licensing of vehicle is part of the value!?). It states that the total
VALUE of the works must be ascertained.
What you quoted was "The Employer's entitlement to delay damages under SubClause 8.7 (9.6
(G)) is a separate right to payment and does not operate as a reduction to the Accepted Contract
Amount" - the second part of which is covered above.
The first part refers to the employers right to payment of DD (if due) and the determination
mentioned in the original post says it is: and the industry standard is to deduct the amount from
the payment (not the value of works) due to the contractor.
(Or are you suggesting that the employer should invoice the contractor for a sum of DD that
common knowledge suggest the contractor would not pay, possession being 9 tenths of the...
Senior Planning Engineer at KEO International Consultants
Dear Paul,
I think the differences between us can be narrowed down to the below. Please note that what is
written below is based on FIDIC YB 1999 (as the question was based on that).
* Can the Employer proceed to ‘off set’, ‘claim’ or ‘deduct from a Payment Certificate’ the value he
thinks is due from the Contractor as Delay Damages (8.7) by only serving a Notice under 2.5 and
without obtaining a 3.5 Determination?
You stated the Employer can, since (in your own terms);
‘there is no reference in clause 8.7 to any decision required from the Engineer under 3.5’.
Then you continued to state
‘8.7 states the "... Contractor shall ... pay ..." and the Employer has an entitlement to be paid the
damages’.
What you missed in the quote is; 8.7 states that
* Contractor shall “subject to Sub-Clause 2.5 [ Employer’s Claims ]” pay delay damages to the
Employer for this default---
I am glad that we are at least in agreement on the notice requirement. However, I would like to
know how you reached the conclusion from 8.7 that only a Notice is required. Please quote the
statement in 8.7 which set qualification for its application under 2.5 (as stated by you in your fifth
comment). All I could find was Sub-clause 8.7 refers to 2.5 as the procedure to be followed.
I already stated that, as per the FIDIC Procedure, if the Employer wants to act within theContract, a notice and PARTICULARS to be issued to the Contractor under 2.5 Employer’s
Claims, referring to 8.7 Delay Damages. The Engineer will then proceed according to 3.5
Determination; First , t ry to reach an agreement with both parties and if unsuccessful, to issue a
fair Determination. Once, it is done the Employer can proceed to “set off against” or “make any
deduction from an amount certified in a Payment Certificate”, or to otherwise “claim against” the
Contractor.
Further, I have the below link from FIDIC.
http://fidic.org/node/923
* In order to deduct delay damages the Employer must submit a Claim in accordance with Sub-
Clause 2.5. As required by 2.5, the Engineer will then make a determination under Sub-Clause
3.5. If the Engineer determines that the Employer is entitled to deduct an amount as delay
damages then it can be deducted from Payment Certificates in accordance with the final
paragraph of 2.5---
Also, s ince you referred to N. G. Bunni, please refer to page 526 under section titled (23.3.4)
'Clause 3: The Engineer’ in his book titled “The FIDIC Forms of Contract (Third Edition)”.
[Continued below]
Hashim Muhammud Bashir
Senior Planning Engineer at KEO International Consultants
2) Is 3.5 Determination a crucial aspect considering the Employer’s right for DD under the Law.
I will reiterate that I am not going to bring the application of Law in here, because I do not consider
myself qualified/experienced to answer such a question in a generalized way. Furthermore, it was
never mentioned or requested by the original questioner. The question was very specific in that
regard.However, as I stated earlier, I agree with you 100% that, the potential impact of Law on the
Contract should be considered by the parties before applying the DD. Who knows, even a notice
may not be required under the Law!
3) Can the DD be applied, when the Contractor is contesting the 3.5 Determination on his EOT
Claims and/or on the DD itself?
As an answer to the above (which I already made in first comment), let me quote what is stated in
FIDIC and then the explanation in FIDIC Guide below.
The last sentence under 3.5 Determination in FIDIC YB 1999:
--- Each Party shall give effect to each agreement or determination unless and until revised under
Clause 20 [ Claims, Disputes and Arbitration ].---
--- The Engineer is then required to notify both Parties of his determination, “which is binding upon
them unless and until revised” under the dispute resolution procedures in Clause 20.---
Hence, IMHO, one party contesting the 3.5 Determination by proceeding with the dispute
resolution mechanism provided in FIDIC doesn’t mean that the Determination will be of no effect.
[Continued below]
Delete 1 month ago
Hashim Muhammud Bashir
Senior Planning Engineer at KEO International Consultants
* Can the Employer withhold monies from a Certified Payment for DD without following procedurein 2.5?
Let me quote from the FIDIC Guide’s explanation on Sub-clause 14.7 Payment
* Under CONS or P&DB, the Contractor receives a copy of an Interim Payment Certificate which
notifies him of the payment to which he is entitled, as fairly determined by the Engineer. The
Employer is thereafter bound by the Certificate, and must make payment in full, irrespective of
any entitlement to compensation arising from any claim which the Employer may have against the
Contractor. If the Employer considers himself entitled to claim against the Contractor, notice and
particulars must first be submitted under Sub-Clause 2.5. The Employer's entitlement is then to
be agreed or determined, and incorporated as a deduction in a Payment Certificate. This
procedure, as prescribed in Sub-Clause 2.5 (notice, particulars, and agreement or determination),
may require less time than the 28 days mentioned in the first paragraph of Sub-Clause 14.6.---
Please note that in the question & answer given by FIDIC (refer to item 1 above), the DD is
considered as an Employer’s claim by FIDIC.
* Can the DD be included as a deduction to the IPC?
Below is quoted from FIDIC Guide, from its explanation on 14.6 Issue of Interim Payment
Certificate.
* If the Employer considers himself entitled to c laim against the Contractor, notice and particulars
must first be submitted under Sub-Clause 2.5. The Employer's entitlement is then to be agreed or
determined, and “incorporated as a deduction in a Payment Certificate”.---
At the moment, I am unable to obtain a copy of Baker’s book (a brilliant work indeed) and hence, I
cannot comment on the quote provided by you. However, based on what I read from the quoted
part, I don’t think that it is contradicting with any of the above. It just state that the deduction for
DD included in an IPC (as per 2.5) is not to be confused as a reduction in ‘the amounts payable to
the Contractor for work done’. The Contractor’s entitlement for Work performed remains the same;
however the net payment he will receive will be Contractor’s entitlement less the DD (along with
any other applicable deductions).
* Can the DD be included as a deduction in the Final Statement?
Again I have the same link from FIDIC as a response.
http://fidic.org/node/923
* limit for delay damages
Question:
… can the client apply the penalty on the contractor now? Or any time? The final payment
certificate is not yet issued and approved, also some variation orders are not yet finalized.
Answer:
Sub-clause 8.7 of the General Conditions of Contract gives the possibility for the Employer to
apply delay damages in the limit stated in the Appendix to Tender. The Employer must follow the
procedure stated in the Sub-clause 2.5 for claiming from the Contractor the delay damages. If you
look at Sub-clause 2.5, there are no time constraints related to the point in time when theEmployer can claim the delay damages, so the Employer can claim at any time.---
Further, I already mentioned about 14.13 (b) which requires the Engineer to issue the Final
Payment Certificate;
* (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”, the balance (if any) due from the Employer to the
Contractor or from the Contractor to the Employer, as the case may be.---
I hope the above clarified my understanding in this topic. I don’t think I can add anymore to this
discussion, unless you have further/new comments on the above.
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Price" as stated clearly by FIDIC.
The Contract Price/Amount, call it what you will, cannot be changed - it's a total value of the
Contract (including changes thereto) which is 'above' the line.
And before you do, let the others get in line to deliver the first hoof to my rear... :-)
Hashim Muhammud Bashir likes this
Delete 1 month ago
Hashim Muhammud Bashir
Senior Planning Engineer at KEO International Consultants
lol... Sorry Andy... I couldn't resist the temptation to take the risk to use the opportunity. ;)
"The Contract Price/Amount, call it what you will, cannot be changed".
I have my doubt about the validity of above statement as far as FIDIC 1999 Suites are concerned.
As per Yellow Book, Accepted Contract Amount (ACA) is a LS figure as stated in the LOA. If this
is the figure that you s tated as cannot be changed, then you are right.
Whereas Contract Price (CP) is equal to ACA, only & until it is adjusted in accordance with the
Contract (14.1.a). And that adjustment could be addition or omission. One such omission can be
DD, that is my opinion, after reading the statement in 2.5 Contractor's Claims.
I think I have seen further references to REDUCTION in CP in FIDIC guide (Contractor's failure to
remedy the defects was one I guess). Unfortunately I will have to wait till tomorrow to see where &
how exactly those statements are worded.
My understanding is; CP is what the Contractor get paid in the end for all the Works done less all
kind of omissions. I might be idiotically wrong here. Hence I will hope for further comments from
the esteemed members (and that includes you).
:)
Regards,
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Clarence Elmer Quismundo, MRICS, MAIQS
Chartered QS, CMCCA, CCCE, PMO, CE
Dear Gents/Lady,
I came to read this thread very late in its life and there is nothing much I can say further without
being redundant or possibly muddling the issue (knowing my penchant of stirring the pot). Sogenerally, I am in agreement with the positions put forth by Andy and Hashim, whose patience in
elaborating it is really a virtue. Not bad for (in Hashim's own words) a "simple planning engineer".
Just to add a point: My understanding of the Accepted Contract Amount is the original figure as
negotiated and awarded by the Employer to the Contractor, while the Contract Price is a figure in
progress that is being continually adjusted (either by addition or subtraction, depending on various
reasons such as positive/negative variation, deductions/reductions, etc.) which culminates in a
Final Contract Price in the Final Account.
Best regards.
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Cristiana Roscoiu
Contract manager at Romanian National Company of Motorways and National Roads (RNCMNR)
Indeed as per FIDIC SCL 1.1.4.1 “Accepted Contract Amount” means the amount accepted in the
LoA for the execution and completion of the Works and the remedying of any defects” that it is
the fixed value (it cannot be changed...)
whereas the Contract Price as per SCL 1.1.4.2 “means the price defined in Sub – Clause 14.1
[The Contract Price], and includes adjustment in accordance with the Contract.” and the DD s are
part of these adjustment …
If the Accepted Contract Amount is changed the fair competition at the tendering is injuriously