Introduction - Differences (1).pdf

Comparison between the FIDIC 1999 Forms Red Book - Conditions of Contract for Construction Yellow Book - Conditions of Contract for Plant and Design-Build Silver Book - Conditions of Contract for EPC/Turnkey Projects Recommended for building and engineering works if most (or all) of the works are...

Comparison between the FIDIC 1999 Forms Red Book - Conditions of Contract for Construction Yellow Book - Conditions of Contract for Plant and Design-Build Silver Book - Conditions of Contract for EPC/Turnkey Projects Recommended for building and engineering works if most (or all) of the works are to be designed by (or on behalf of) the Employer Recommended for the provision of electrical and/or mechanical plant and for building and engineering works if most (or all) of the works are to be designed by (or on behalf of) the Contractor. The Contract is administered by the Engineer who is appointed by the Employer. If disputes arise, they are referred to a DAB for its decisions. The Contract is administered by the Engineer who is appointed by the Employer. If disputes arise, they are referred to a DAB for its decisions. Suitable for a process or power plant, a factory or similar facility, or an infrastructure project or other type of development, if (i) a higher degree of certainty of final price and time is required, and (ii) the Contractor takes total responsibility for the design and execution of the project. The Contract is administered by the Employer (unless he appoints an Employer's Representative) who endeavours to reach agreement with the Contractor on each claim. Alternatively, Particular Conditions may specify Engineer's decisions on disputes, in lieu of a DAB. Alternatively, Particular Conditions may specify Engineer's decisions on disputes, in lieu of a DAB. If disputes arise, they are referred to a DAB for its decisions. The Contractor designs (but only to the extent specified) and executes the works in accordance with the Contract (which includes the Specification and Drawings) and the Engineer's instructions. The Contractor provides plant, and designs (except as specified) and executes the other works, all in accordance with the Contract, which includes his Proposal and the Employer's Requirements. The Contractor provides plant, and designs and executes the other works, ready for operation in accordance with the Contract, which includes his Tender and the Employer's Requirements. Interim and final payments are certified by the Engineer, typically determined by measurement of the actual quantities of the works and applying the rates and prices in the Bill of Quantities or other Schedules. Interim and final payments are certified by the Engineer, typically determined by reference to a Schedule of Payments. Interim and final payments are made without any certification: typically determined by reference to a Schedule of Payments. Other valuation principles can be specified in Particular Conditions. The alternative of measurement of the actual quantities of the works and applying the rates and prices in a Schedule of Prices can be specified in Particular Conditions. The alternative of measurement of the actual quantities of the works and applying the rates and prices in a Schedule of Prices can be specified in Particular Conditions. The General Conditions allocate the risks between the parties on a fair and equitable basis: taking account of such matters as insurability, sound principles of project management, and each party's ability to foresee, and mitigate the effect of, the circumstances relevant to each risk. The General Conditions allocate the risks between the parties on a fair and equitable basis: taking account of such matters as insurability, sound principles of project management, and each party's ability to foresee, and mitigate the effect of, the circumstances relevant to each risk. Disproportionately more risks are allocated to the Contractor under the General Conditions. Tenderers will require more data on hydrological, sub-surface and other conditions on the Site, to the extent that this data is relevant to the particular type of works, and more time to review the data and evaluate such risks. Pagina 10 van 34 www.drivertrett.com Employer's Claims Sub-Clause 2.5 sets out the procedures relevant to claims by the Employer. The provisions of the sub clauses have been discussed in the context of delay damages, to which the reader is referred. Following the Employer's submission of the particulars to the Engineer, the Engineer tries to agree the claim in discussion with both the Employer and the Contractor in accordance with Sub clause 3.5, Determination. Note that the claims have to be discussed with the Contractor, they cannot be applied unilaterally by the Employer and/or the Engineer acting on his behalf. What happens when the amount due has been determined is less clear. The Employer appears to have three options: (i) to ask the Engineer to deduct the amount in his calculation for the next payment certificates, (ii) to deduct the amount from a sum payable under a payment certificate, or (iii) to make a separate claim against the Contractor. Note that Sub clause 14.3 provides that an application for payment by the Contractor should include "any other additions or deductions which may have become due…” and that the Employer is obliged to pay under Sub clause 14.7, against sanction for non-payment under 14.5. The last paragraph of Sub clause 2.5 restricts the Employer's common law right to set off to his claim made under this sub clause. There is some doubt as to whether the wording is adequate in this respect. Table 1 - Employer's claims/deductions Clause Clause Title Event No 2.5 Employer's Claims Various 4.2 4.19 4.20 7.5 7.6 8.6 Procedure Comments Notice + particulars as soon as practicable Performance Security Specified failures (a) None to (d) Electricity, Water and Amounts consumed 2.5/3.5 Notice not required Gas (2.5) Employer's Amounts due for use 2.5/3.5 Notice not required Equipment and Free (2.5) Issue Material Rejection Additional costs due 2.5 to rejection and retesting Remedial Work Contractor fails to 2.5 comply with remedial instruction Rate of Progress Revised methods 2.5 cause Employer to incur costs Pagina 21 van 34 www.drivertrett.com 8.7 Delay Damages 2.5 May be reduced under 10.2 Failure to Pass Tests on Completion Contractor fails to comply with Time for Completion Part of works useless 9.4 Termination ditto ditto Value reduced 11.3 Extension of Defects Notification Period 11.5 Failure to Remedy Defects Part of works useless due to defect Failure to remedy within reasonable time Agreement + TOC or TOC/3.5 2.5 All sums paid for Part, financing, clearing Reduced value 11.11 Clearance of site 15.4 Payment: after Termination 18.1 General Requirements for Insurances Insurance for Works and Contractor's Equipment 18.2 Pagina 22 van 34 Non-clearance by Contractor Termination by Employer Prior reasonable notice of reasonable time 2.5 Contractor fails to 2.5 insure Contractor unable to 2.5 insure Max extension: +2 years Cost of works by others or reasonable reduction or, for useless works, all sums paid, financing, clearing Cost of sale Extra cost to complete, losses and damages Premiums Amount equivalent to commercially reasonably premium www.drivertrett.com TABLE 2 - CONTRACTOR'S CLAIMS Red Clause Clause Title No 1.9 Delayed drawings instruction Silver Cost/Prof Yellow it or Late drawing or Reasonable Cost + N/a N/a instruction prior notice + profit (Errors in (Confidentiality) 20.0 ER's) Event Notice 2.1 Right of Access to the Site Late access or 20.1 possession Cost profit +

4.7 Setting-Out Error in 20.1 specified reference points (not reasonably discoverable by experienced Contractor Cost profit +
X
X





(not weather or shortages)




Employer may not take early possession without consent 4.12 Unforeseeable Conditions 4.24 Fossils Compliance with Promptly instructions +20.1 Cost 7.4 Testing Instructions for 20.1 additional passed test, or delay for which Employer responsible Cost profit 8.4 Extension Completion 8.5 Delays caused by Authorities 8.9 Consequences of Suspension Suspension 10.2 of Physical Adverse unforeseeable condition time for Various As soon as Cost practicable +20.1 20.1 Delays caused 20.1 by Authorities 8.4) 20.1 Taking over of Parts of the Employer's use 20.1 Works of part of Works without Contractor's Pagina 23 van 34 + n/a (via X Cost Cost profit + www.drivertrett.com Red Clause No Clause Title Event Notice Cost/Prof it Yellow Silver



agreement 10.3 11.2 11.8 12.4 13.2 13.3 13.7 15.5 16.1 16.4 Interference with Tests on Prevention of Completion tests Cost of Remedying Defects Defects not Contractor's responsibility Contractor to Search No Contractor defect found Omissions Omission of work Value Engineering Approved proposal changes design Variation Procedure Re-rating justified Adjustments or Changes in Change in law Legislation Employer's Entitlement to Employer Termination terminates at will Contractor's Entitlement to Contractor Suspend Work suspends due to Employers default Payment on Termination Contractor terminates due to Employer's default 17.4 Consequences of Employer's Risk 19.4 Consequences Majeure Pagina 24 van 34 of 20.1 Notice Employer +20.1? 20.1? Cost profit by V.O. +
Cost + profit Notice with 'Cost' N/a Claim particulars incurred for delayed anyway Tests after Completion 20.1? 50% of net X saving
N/a Claim for delayed Tests after Completion X 12+20.1 V.O.

20.1 Cost

of +

+

14 days prior Release of (or bond, immediate) value + Cost, profit, loss and damage Loss or damage Promptly/20 Cost (+ to Works etc. .1 profit in due to two Employer's risk instances)





16.3/19.6 Value work Cost 21 days Cost prior+ 20.1 profit Force Prevented from Within 14 Cost performing any days/20.1 (except obligation natural catastroph www.drivertrett.com Red Clause No Clause Title Event Cost/Prof it es) Yellow Silver days' Value Cost +

Performance Impossible, 'Upon notice' Value unlawful or Cost released by law +

19.6 Optional Termination, Prolonged payment and Release prevention 19.7 Release from under the Law 20.1 Contractor's claim Pagina 25 van 34 Notice Contractor considers himself entitled to EOT or extra payment 7 notice 28 days (42 days for fully detailed claim) www.drivertrett.com