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Presentation on theme: "CONSTRUCTION CONTRACTS DOCUEMENTS"— Presentation transcript:


2 General Conditions of contract
The conditions are intended to govern and regulate the obligation of formal contract. Although the headings and topics included within different sets of GCC vary, there is a certain similarity of subject matter

3 Contents of GCC Definitions Contract documents
Rights and responsibilities of owner Duties and authorities of engineer Rights and responsibilities of contractor Sub-contractor, Separate contractors Time Payments and completions Changes in the work Protection of persons and property Insurance and bond Disputes Termination of contract Miscellaneous provisions

4 FIDIC , AN INTRODUCTION Founded in 1913
Expanded in 1945 to include 40 national associations Published first Conditions of Contract in 1957 In 2004 has 64 member associations Headquarters in Switzerland Web Site :

5 Pre 1957 – no internationally recognised contract conditions
FIDIC , AN INTRODUCTION Pre 1957 – no internationally recognised contract conditions First “red book” based on UK ICE conditions FIDIC has international committees to improve contracts

6 Contract Documents 1999 Conditions of Contract for Construction (Red Book) Conditions of Contract for Plant & Design Build (Yellow Book) Conditions of Contract for EPC Turnkey Projects (Silver Book) Short Form of Contracts (Green Book)

7 FIDIC Document Usage Conditions of Contract for Construction
Works designed by Employer or Engineer Contractor Constructs in accordance with designs provided May include some design elements

8 FIDIC Document Usage Conditions of Contract for, Plant & Design Build
Electrical & Mechanical Plant May include building and engineering Design & Execution of works Contractor designs and constructs in accordance with Employer’s Requirements Engineer Administers

9 FIDIC Document Usage Short Form of Contract
Small capital value projects Simple content Contractor constructs to Employer’s designs No “Particular Conditions” No “Impartial” Engineer

10 Typical sequence of Principal Events during Contracts

11 Typical sequence of Payment Events envisaged in Clause 14(contract price and payment)

12 Typical sequence of Dispute Events envisaged in Clause 20
DAB: the persons so named in the contract or other persons appointed under sub-clause (appointment of the dispute adjudication board)

13 FIDIC conditions of contract

14 FIDIC conditions of contract (cont’d)

15 FIDIC conditions of contract
1 GENERAL PROVISIONS 1.1 Definitions 1.2 Interpretation 1.3 Communications 1.4 Law and Language 1.5 Priority of Documents 1.6 Contract Agreement 1.7 Assignment 1.8 Care and Supply of Documents 1.9 Delayed Drawings or Instructions 1.10 Employer’s Use of Contractor’s Documents 1.11 Contractor’s Use of Employer’s Documents 1.12 Confidential Details 1.13 Compliance with Laws 1.14 Joint and Several Liability

16 FIDIC conditions of contract cont’d
2 THE EMPLOYER Right of Access to the Site 2.2 Permits, Licenses or Approvals 2.3 Employer’s Personnel 2.4 Employer’s Financial Arrangements 2.5 Employer’s Claims 3 THE ENGINEER 3.1 Engineer’s Duties and Authority 3.2 Delegation by the Engineer 3.3 Instructions of the Engineer 3.4 Replacement of the Engineer 3.5 Determinations

17 FIDIC conditions of contract cont’d
4 THE CONTRACTOR 4.1 Contractor’s General Obligations 4.2 Performance Security 4.3 Contractor’s Representative 4.4 Subcontractors 4.5 Assignment of Benefit of Subcontract 4.6 Co-operation 4.7 Setting Out 4.8 Safety Procedures 4.9 Quality Assurance 4.10 Site Data 4.11 Sufficiency of the Accepted Contract Amount 4.12 Unforeseeable Physical Conditions 4.13 Rights of Way and Facilities

18 4. 14 Avoidance of Interference 4. 15 Access Route 4
4.14 Avoidance of Interference 4.15 Access Route 4.16 Transport of Goods 4.17 Contractor’s Equipment 4.18 Protection of the Environment 4.19 Electricity, Water and Gas 4.20 Employer’s Equipment and Free-Issue Material 4.21 Progress Reports 4.22 Security of the Site 4.23 Contractor’s Operations on Site 4.24 Fossils

5 NOMINATED SUBCONTRACTORS 5.1 Definition of “nominated Subcontractor” 5.2 Objection to Nomination 5.3 Payments to nominated Subcontractors 5.4 Evidence of Payments

20 6 STAFF AND LABOUR 6. 1 Engagement of Staff and Labour 6
6 STAFF AND LABOUR 6.1 Engagement of Staff and Labour 6.2 Rates of Wages and Conditions of Labour 6.3 Persons in the Service of Employer 6.4 Labour Laws 6.5 Working Hours 6.6 Facilities for Staff and Labour 6.7 Health and Safety 6.8 Contractor’s Superintendence 6.9 Contractor’s Personnel 6.10 Records of Contractor’s Personnel and Equipment 6.11 Disorderly Conduct 6.12 Foreign Personnel 6.13 Supply of Foodstuffs

21 6.14 Supply of Water 6.15 Measures against Insect and Pest Nuisance 6.16 Alcoholic Liquor or Drugs 6.17 Arms and Ammunition 6.18 Festival and Religious Customs 6.19 Funeral Arrangements 6.20 Prohibition of Forced or Compulsory Labor 6.21 Prohibition of Harmful Child Labour 6.22 Employment Records of Workers

22 7 PLANT, MATERIALS AND WORKMANSHIP 7. 1 Manner of Execution 7
7 PLANT, MATERIALS AND WORKMANSHIP 7.1 Manner of Execution 7.2 Samples 7.3 Inspection 7.4 Testing 7.5 Rejection 7.6 Remedial Work 7.7 Ownership of Plant and Materials 7.8 Royalties 8 COMMENCEMENT, DELAYS AND SUSPENSION 8.1 Commencement of Works 8.2 Time for Completion 8.3 Programme 8.4 Extension of Time for Completion 8.5 Delays Caused by Authorities 8.6 Rate of Progress 8.7 Delay Damages

23 8.8 Suspension of Work 8.9 Consequences of Suspension 8.10 Payment for Plant and Materials in Event of Suspension 8.11 Prolonged Suspension 8.12 Resumption of Work 9 TESTS ON COMPLETION 9.1 Contractor’s Obligations 9.2 Delayed Tests 9.3 Retesting 9.4 Failure to Pass Tests on Completion 10 EMPLOYER’S TAKING OVER 10.1 Taking Over of the Works and Sections 10.2 Taking Over of Parts of the Works 10.3 Interference with Tests on Completion 10.4 Surfaces Requiring Reinstatement

24 11 DEFECTS LIABILITY 11.1 Completion of Outstanding Work and Remedying Defects 11.2 Cost of Remedying Defects 11.3 Extension of Defects Notification Period 11.4 Failure to Remedy Defects 11.5 Removal of Defective Work 11.6 Further Tests 11.7 Right of Access 11.8 Contractor to Search 11.9 Performance Certificate Unfulfilled Obligations Clearance of Site

12.1 Works to be Measured 12.2 Method of Measurement 12.3 Evaluation 12.4 Omissions 13 VARIATIONS AND ADJUSTMENTS 13.1 Right to Vary 13.2 Value Engineering 13.3 Variation Procedure 13.4 Payment in Applicable Currencies 13.5 Provisional Sums 13.6 Daywork 13.7 Adjustments for Changes in Legislation 13.8 Adjustments for Changes in Cost

26 14 CONTRACT PRICE AND PAYMENT 14. 1 The Contract Price 14
14 CONTRACT PRICE AND PAYMENT 14.1 The Contract Price 14.2 Advance Payment 14.3 Application for Interim Payment Certificates 14.4 Schedule of Payments 14.5 Plant and Materials intended for the Works 14.6 Issue of Interim Payment Certificates 14.7 Payment 14.8 Delayed Payment 14.9 Payment of Retention Money Statement at Completion Application for Final Payment Certificate Discharge Issue of Final Payment Certificate Cessation of Employer’s Liability Currencies of Payment

15.1 Notice to Correct 15.2 Termination by Employer 15.3 Valuation at Date of Termination 15.4 Payment after Termination 15.5 Employer’s Entitlement to Termination for Convenience 15.6 Corrupt or Fraudulent Practices

16 SUSPENSION AND TERMINATION BY CONTRACTOR 16.1 Contractor’s Entitlement to Suspend Work 16.2 Termination by Contractor 16.3 Cessation of Work and Removal of Contractor’s Equipment 16.4 Payment on Termination 17 RISK AND RESPONSIBILITY 17.1 Indemnities 17.2 Contractor’s Care of the Works 17.3 Employer’s Risks 17.4 Consequences of Employer’s Risks 17.5 Intellectual and Industrial Property Rights 17.6 Limitation of Liability 17.7 Use of Employer’s Accommodation/Facilities

29 18 INSURANCE 18. 1 General Requirements for Insurances 18
18 INSURANCE 18.1 General Requirements for Insurances 18.2 Insurance for Works and Contractor’s Equipment 18.3 Insurance against Injury to Persons and Damage to Property 18.4 Insurance for Contractor’s Personnel 19 FORCE MAJEURE 19.1 Definition of Force Majeure 19.2 Notice of Force Majeure 19.3 Duty to Minimize Delay 19.4 Consequences of Force Majeure 19.5 Force Majeure Affecting Subcontractor 19.6 Optional Termination, Payment and Release 19.7 Release from Performance

30 20 CLAIMS, DISPUTES AND ARBITRATION 20. 1 Contractor’s Claims 20
20 CLAIMS, DISPUTES AND ARBITRATION 20.1 Contractor’s Claims 20.2 Appointment of the Dispute Board 20.3 Failure to Agree on the Composition of the Dispute Board 20.4 Obtaining Dispute Board’s Decision 20.5 Amicable Settlement 20.6 Arbitration 20.7 Failure to Comply with Dispute Board’s Decision 20.8 Expiry of Dispute Board’s Appointment

31 General conditions The following are main items that include in the general conditions for the tender ( or the construction contract.

32 Definitions Main definitions related to :
Contract : include contract agreement, letter of acceptance, letter of tender, specifications, drawings, schedules, tender, appendix to tender, bill of quantities. parties and persons : party, employer, contractor, engineer, contractor representative, employers' personnel, contractors personnel, sub- contractor, DAB (dispute adjudication board), Fidic. Dates , tests, periods and completion include base date, commencement date, time of completion, test on completion, taking over certificate, defects notification period, performance certificate, day Money and payment: accepted contract amount, contract price, cost, final , interim payment certificate, currency, provisional sum, retention money,

33 Definitions The main definitions that are included in and repeated in the articles of general conditions, are: Employer : The party named in the Contract as the "FIRST PARTY" who will enter into contract with the Contractor for the execution of the Works covered by the Contract, or any other party authorized by the Employer to exercise the powers and obligations of the First Party, provided that the Contractor will be informed accordingly in writing . Contractor : The person, company or joint venture named as Second Party in the Contract whose Tender has been accepted by the Employer and with whom the Employer has entered into Contract, and includes the Contractors personal agents and his legal successors Engineer: The Consulting office, or Engineering office or Engineer or any other technical body appointed from time to time by the Employer to exercise in whole or in part the powers of the Engineer in accordance with the Conditions of the Contract provided that the Contractor shall be accordingly notified in writing.

34 Definitions, Cont’d Engineers Representative - Any resident engineer, or clerk of works appointed by the Engineer from time to time Contract - The documents constituting these Conditions (Parts I and II), the Specification, the Drawings, the Bill of Quantities, the Tender, the Letter of Acceptance, the Contract Agreement, and such further documents as may be expressly incorporated in the Letter of Acceptance or Contract Agreement (if completed). Contract Sum - The sum stated in the Letter of Acceptance as payable to the Contractor for the execution and completion of the Works and the remedying of any defects therein in accordance with the provisions of the Contract, subject to such additions thereto or deductions therefore as may be made under the provisions of the Contract. Equipment is the Contractor’s machinery and vehicles brought temporarily to the Site to construct the Works. Site - The land and other places provided by the Employer or designated as such where the Works are to be executed, and any other places specifically designated in the Contract as forming part of the Site. approval (written approval) time (calendar / working days)

35 Engineer's Duties and Authority
a) The Engineer shall carry out the duties specified in the Contract . b) The Engineer shall exercise the authority specified in or necessarily to be implied from the Contract . Provided, that the Engineer shall obtain the specific approval of the Employer, in compliance with the terms of his appointment, and after submitting his recommendations to the Employer in writing, in the following matters : issuing variation orders; deciding on the extension of Time for Completion and applying the Liquidated Damages Clause; approving the appointment of Subcontractors; notifying the Contractor on suspension of Works; and any other matters as may be set out in Part II of these conditions). (c) Except as expressly stated in the Contract, the Engineer shall have no authority to relieve the Contractor of any of his obligations under the Contract

36 Engineer's Representative
The Engineer's Representative shall be appointed by and be responsible to the Engineer and shall carry out such duties of watching and supervising the execution and workmanship of the Works and to test and examine any materials to be used or workshop employed in connection with the Works. He shall exercise such authority as may be delegated to him by the Engineer

37 Engineer's Authority to Delegate
The Engineer may from time to time delegate to the Engineer's Representative any of the duties and authorities vested in the Engineer and he may at any time revoke such delegation. Any such delegation or revocation shall be in writing and shall not take effect until a copy thereof has been delivered to the Employer and the Contractor . Any communication given by the Engineer's Representative to the Contractor in accordance with such delegation shall have the same effect as though it had been given by the Engineer Provided that : any failure of the Engineer's Representative to disapprove any work, materials or Plant shall not prejudice the authority of the Engineer to disapprove such work, material or Plant and to give instructions for the rectification thereof if the Contractor questions any communication of the Engineers Representative, he may refer the matter to the Engineer who shall confirm, reverse or vary the contents of such communication .

38 Contractor’s General Obligations
The Contractor shall design (to the extent specified in the Contract), execute and complete the Works in accordance with the Contract and with the Engineer’s instructions, and shall remedy any defects in the Works. The Contractor shall provide the Plant and Contractor’s Documents specified in the Contract, and all Contractor’s Personnel, Goods, consumables and other things and services, whether of a temporary or permanent nature, required in and for this design, execution, completion and remedying of defects. The Contractor shall be responsible for the adequacy, stability and safety of all Site operations and of all methods of construction. Except to the extent specified in the Contract, the Contractor : shall be responsible for all Contractor’s Documents, Temporary Works, and such design of each item of Plant and Materials as is required for the item to be in accordance with the Contract, and shall not otherwise be responsible for the design or specification of the Permanent Works.

39 Contractor’s General Obligations,
The Contractor shall, whenever required by the Engineer, submit details of the arrangements and methods which the Contractor proposes to adopt for the execution of the Works. No significant alteration to these arrangements and methods shall be made without this having previously been notified to the Engineer. If the Contract specifies that the Contractor shall design any part of the Permanent Works, then unless otherwise stated in the Particular Conditions: the Contractor shall submit to the Engineer the Contractor’s Documents for this part in accordance with the procedures specified in the Contract; these Contractor’s Documents shall be in accordance with the Specification and Drawings, shall be written in the language for communications

Assignment of Contract The Contractor shall not, without the prior consent of the Employer, assign the Contract or any part thereof, or benefit or interest therein or thereunder, otherwise than by : a charge in favor of the Contractor's bankers of any moneys due or to become due under the Contract, or assignment to the Contractor's insurers of the Contractor's right to obtain relief against any other party liable. Subcontracting The Contractor shall not subcontract the whole of the Works. Except where otherwise provided by the Contract, the Contractor shall not subcontract any part of the Works without the prior consent of the Engineer. Any such consent shall not relieve the Contractor from any liability or obligation under the Contract and he shall be responsible for the acts, defaults and neglects of any Subcontractor, his agents, servants or workmen as fully as if they were the acts, defaults or neglects of the Contractor, his agents, servants or workmen. Provided that the Contractor shall not be required to obtain such consent for : (a) the provision of labor, or (b) the subcontracting of any part of the Works for which the Subcontractor is named in the Contract.

41 Assignment of Subcontractor's Obligations
In the event of a Subcontractor having undertaken towards the Contractor in respect of the work executed, or the goods, materials, Plant or services supplied by such Subcontractor, any continuing obligation extending for a period exceeding that of the Defects Liability Period under the Contract, the Contractor shall at any time, after the expiration of such Period, assign to the Employer, at the Employer's request and cost, the benefit of such obligation for the unexpired duration thereof.

42 Language and Law Arabic language shall be the ruling language of the Contract Documents unless stated otherwise in these conditions, and consequently all correspondence, payment statements, and take-over certificates shall be drawn in this language.

43 Priority of Contract Documents
The several documents forming the Contract are to be taken as mutually explanatory of one another, but in case of ambiguities or discrepancies the same shall be explained and adjusted by the Engineer who shall thereupon issue to the Contractor instructions thereon and in such event, unless otherwise provided in the Contract, the priority of the documents forming the Contract shall be as follows: (1) The Contract Agreement (if completed); (2) The Letter of Acceptance; (3) The Tender; (4) Part II of these Conditions; (5) Part I of these Conditions; and (6) Any other document forming part of the Contract.

44 Performance Security The Contractor, upon receiving the Letter of Acceptance, shall obtain and provide to the Employer before signing the Contract, the Performance Guarantee in the value of ten percent of the Contract Sum, as a guarantee of the proper execution of the Works in accordance with the Contract. This guarantee shall be issued by a licensed bank or financial institution acceptable to the Employer. The guarantee shall be prepared in the form included in part B of these conditions. The obtaining of such guarantee shall in all respects be at the expense of the Contractor.

45 Inspection of Site The Employer shall have made available to the Contractor, before the submission by the Contractor of the Tender, such data on hydrological and sub - surface conditions as have been obtained by or on behalf of the Employer from investigations undertaken relevant to the Works but the Contractor shall be responsible for his own interpretation thereof. The Contractor shall be deemed to have inspected and examined the Site and its surroundings and information available in connection therewith and to have satisfied himself (so far as time is practicable), before submitting his Tender, as to : (a) the form and nature thereof, including the sub - surface conditions, (b) the hydrological and climate conditions, (c) the extent and nature of work and materials necessary for the execution and completion of the Works and the remedying of any defects therein, and (d) the means of access to the Site and the accommodation he may require and, in general, shall be deemed to have obtained all necessary information, subject as above mentioned, as to risks, contingencies and all other circumstances which may influence or affect his Tender. The Contractor shall be deemed to have based on his Tender, the data made available by the Employer and on his own inspection and examination, all as aforementioned.

46 Sufficiency of Tender The Contractor shall be deemed to have satisfied himself as to the correctness and sufficiency of the Tender and of the rates and prices stated in the Bill of Quantities, all of which shall; except insofar as it is otherwise provided in the Contract, cover all his obligations under the Contract (including those in respect of the supply of goods, materials, Plant or services or of contingencies for which there is a Provisional Sum) and all matters and things necessary for the proper execution and completion of the Works and the remedying of any defects therein.

Within a specified time (in days), after the date of the Letter Of Acceptance, the contractor shall submit a programme to the engineer for his consent in such a way and detail as the engineer shall reasonable prescribe for the execution of the works. It is also required that whenever the engineer requires, the contractor shall provide in writing, for his information, a general description of the arrangement and methods which the contractor proposes to adopt for the execution of the works.

48 REVISED PROGRAMME If it appears to the engineer, at any time, that the actual progress of the works does not conform to the progamme to which consent, is given; the contractor at the request of the engineer, is required to produce a revised programme necessary to ensure completion of the works within the Time for Completion.

49 CASHFLOW ESTIMATE The contractor shall within time stated in Part II provide a detailed cash flow estimate, in quarterly period, for all payments to which the contractor will be entitled under the contract (to the engineer) and the contractor shall subsequently supply revised cash flow estimates at quarterly intervals, if required to do so by the engineer. Such cash flow statements do not relieve the contractor of any of this duties or responsibilities under the contract.

The contractor is needed to provide all necessary superintendence during the execution of the work and thereafter, as long as the engineer consider it necessary for proper fulfillment of the contractor’s obligations under the contract. If the approval of Contractor’s representative is withdrawn by the Engineer then Contractor shall replace him by any other representative approved by the Engineer. CONTRACTOR’S EMPLOYEES The contractor shall provide on the site only skilled and experienced technical assistants and foremen to provide proper superintendence to skilled, semiskilled and unskilled labour as is necessary. ENGINEER AT LIBERTY TO OBJECT The Client’s engineer having objection on the contractor’s worker when they misconduct themselves, or are incompetent or negligent in the proper performance of his duties. Such workers should be replaced as soon as possible. SETTING OUT The contractor has to look after about the accurate setting out of the works and the provision of all necessary instruments, appliances and labour in connection with the foregoing responsibilities. The contractor shall rectify any error if caused regarding setting out unless it was caused due to incorrect data provided by Engineer in writing.

51 The Contractor shall insure the following
INSURANCE The Contractor shall insure the following The full replacement cost for the plant and materials to be incorporated in the works plus 15 percent of the full replacement cost in addition to be insured for the additional costs like rectification of loss or damage, Professional fees, Demolishing cost and removing the debris from the work. The Contractor’s Equipment and other things brought to the site for a sum sufficient for its replacement.

52 War, Hostilities, Invasion, Act of Foreign enemies.
SCOPE OF COVER For the cases mentioned the insurance will be in the joint names of the contractor and the employer, and shall cover (a) the employer and the contractor against all loss or damage other than force Majeure causes stated below from start of work till take over by Employer. (b) the contractor during Defects Liability Period for loss or damage caused prior to beginning of Defects Liability Period. EXCLUSIONS There shall be no obligation of insurance to cover force Mejure issues such as War, Hostilities, Invasion, Act of Foreign enemies. Rebellion, Revolution, Insurrection, Military or usurped power or civil war. ionizing radiation, Contamination by radioactivity Pressure waves from aircraft or other aerial devices

The Contractor indemnifies and holds harmless, the Employer on following issues. a) Death of or Injury to any person or Loss of or damage to any property other than Works which may arise out of execution and completion of the works, subject to following exceptions EXCEPTIONS The exceptions referred above are a) The permanent use or occupation of land by the works. b) The right of employer to execute the works over under or through the land. c) Damage to the property during the execution of the work if the damage is unavoidable in the process of execution and remedying the defects as per the Contract. d) Damage to property and persons who are either injured or dead because of any act or neglect of the Employer, his agents, other Contractors who are not directly employed by the contractor. The Employer shall indemnify the Contractor against all claims arising out of exceptions provided in the contract. THIRD PARTY INSURANCE The Contractor shall insure in the joint names of the Employer and himself, without limiting his or Employer obligations and responsibilities, against injury or death to any person, loss or damages to the property arising out of the performance of contract. This insurance is not to cover the exceptions above

54 THIRD PARTY INSURANCE The Contractor shall insure in the joint names of the Employer and himself, without limiting his or Employer obligations and responsibilities, against injury or death to any person, loss or damages to the property arising out of the performance of contract. MINIMUM AMOUNT OF INSURANCE The insurance made shall be for at least the amount specified in the appendix of the Tender.

55 SUSPENSION The Contractor shall, on the instructions of the Engineer, suspend the progress of the Works or any part thereof for such time and in such manner as the Engineer may consider necessary and shall, during such suspension, properly protect and secure the Works or such part thereof so far as is necessary in opinion of the Engineer. Unless such suspension is : a) otherwise provided for in the Contract, or b) necessary by reason of some default of or breach of contract by the Contractor or for which he is responsible, or (c) necessary by reason of climatic conditions on the Site, or (d) necessary for the proper execution of the Works or for the safety of the Works on any part thereof (save to the extent that such necessity arises from any act or default by the Engineer or the Employer or from any of the risks defined in GCC), or (e) by mutual agreement in writing by both parties to the Contract, provided that the Employer shall not suffer the expenses resulting from such suspension, provided always that the Contractor shall not be entitled to recover any such extra expenses unless he gives to the Engineer written notice of his intention to claim within (28) days of the Engineers order,

56 Engineer's Determination Following Suspension
The engineer shall after consulting the contractor and the employer determine, - Any extension of time - The amount to be added to the contract price, due to suspension. Suspension Of Work For More Than 84 Days If the progress of the work is suspended for more than 84 days then the contractor can give a notice for resumption of work within 28 days of receipt of order. If permission for resumption is not given within the said period then the contractor can consider it as termination of contract.

57 Time for Completion The whole of the Works and, required to be completed within a particular time as stated in the Appendix to Tender, shall be completed,, within the time stated in the Appendix to Tender for the whole of the Works or the Section (as the case may be), calculated from the Commencement Date, or such extended time as may be allowed under next clauses. No mobilisation period will be allowed for as an extension of the Completion Time, as such period is considered to be included in it.

58 Extension of Time for Completion
In the event of : (a) the amount or nature of extra or additional work, or (b) any cause of delay referred to in these Conditions, or (c) exceptionally adverse climatic condition (but no extension of time shall be granted for the anticipated climatic changes), or (d) any delay, impediment or prevention by the Employer, or (e) other special circumstances which may occur, other than through a default of or breach of contract by the Contractor or for which he is responsible, being such as fairly to entitle the Contractor to an extension of the Time for Completion of the Works, or any Section or part thereof, the Engineer shall, after due consultation with the Employer and the Contractor, determine the amount of such extension and shall notify the Contractor accordingly, with a copy to the Employer.

59 Contractor to Provide Notification and Detailed Particulars
The Engineer is not bound to make any determination unless the Contractor has : (a) within 28 days after such event has first arisen notified the Engineer with a copy to the Employer, and (b) within 28 days, or such other reasonable time as may be agreed by the Engineer, after such notification submitted to the Engineer detailed particulars of any extension of time to which he may consider himself entitled in order that such submission may be investigated at the time.

60 Interim Determination of Extension
If it is impracticable for contractor to provide details of delay within 28 days, the extension shall still be granted, if contractor can provide interim details. But the full details of event need to be provided within 28 days of the end of the effects resulting from events.

61 Liquidated Damages for Delay
If the Contractor fails to comply with the Time for Completion, for the whole of the Works or, if applicable, then the Contractor shall pay to the Employer the relevant sum stated in the Appendix to Tender as liquidated damages for such default and not as a penalty for every day or part of a day which shall elapse between the relevant Time for Completion and the date stated in a Taking-Over Certificate of the whole of the Works or the relevant Section, subject to the applicable limit stated in the Appendix to Tender. The Employer may, without prejudice to any other method of recovery, deduct the amount of such damages from any moneys due or to become due to the Contractor. The payment or deduction of such damages shall not relieve the Contractor from his obligation to complete the Works, or from any other of his obligations and liabilities under the Contract. The rate of liquidated damages stated in the Appendix to Tender is exclusive of any additional supervision costs in respect of the unjustified time lapse in completing the Works, and the Contractor shall bear such costs.

62 Reduction of Liquidated Damages
If, before the Time for Completion of the whole of the Works or, if applicable, any Section, a Taking-Over Certificate has been issued for any part of Works or of a Section, the liquidated damages for delay in completion of the remainder of the Works or of that Section shall, for any period of delay after the date stated in such Taking-Over Certificate, and in the absence of alternative provision in the Contract, be reduced in the proportion which the value of the part so certified bears to the value of the whole of the Works or Section, as applicable. The provisions of this Clause shall only apply to the rate of liquidated damages and shall not affect the limit thereof.

63 Taking-Over Certificate
When the whole of the Works have been substantially completed and have satisfactorily passed any Tests on Completion prescribed by the Contract, the Contractor may give a notice to that effect to the Engineer, with a copy to the Employer, accompanied by a written undertaking to finish with due expedition any outstanding work during the Defects Liability Period. Such notice and undertaking shall be deemed to be a request by the Contractor for the Engineer to issue a Taking-Over Certificate in respect of the Works. The Engineer shall conduct an inspection of the Works and report his findings to the Employer with a copy to the Contractor. The Engineer may either certify that the works have been properly completed or ready for acceptance or give instructions in writing to the Contractor specify the works which, in the opinion of the Engineer, require to be done by the Contractor and to the Engineer's satisfaction, within a prescribed period of time before acceptance. If the contractor considers the Engineer's report to be incorrect, he may give a notice to that effect to the Employer, who shall, in the manner he deems suitable either investigate the situation to ascertain the validity of the Engineer's report or form a Committee for the Taking-Over of the Works.

64 The Employer shall, within ten days from receipt of the Engineer's report, form a "Taking-Over Committee", including the Engineer as one of its members, and notify the Contractor of the time and date fixed for carrying out an inspection of the Works. The Engineer and the Contractor shall, in the meanwhile, prepare all necessary schedules, data, bills and drawings as are necessary to facilitate the said Committee’s work. The Committee shall, within ten days from the date of being formed, conduct in the presence of the Contractor or his authorised agent an inspection of the Works, and having done so, shall draw up a memorandum of certification of the Works which shall be signed by the Committee members as well as by the Contractor or his authorised agent. Copies of the same shall be given to the Employer and the Contractor. The Engineer shall within seven days of the date of delivery of the memorandum of the Taking-Over Committee to the Contractor, issue a Taking-Over Certificate in respect of the Works, stating the date on which, in his opinion, the Works are considered to be substantially completed in accordance with the Contract and the date of commencement of the Defects Liability Period. The Engineer shall enumerate in the Taking-Over Certificate all defects and faults to be remedied by the Contractor within a prescribed time starting from the start of the Maintenance Period. The Contractor is entitled to comment or object to the memorandum of the Taking-over Committee in writing to the Engineer, provided he does so within (7) days from the date of signing the memorandum. The Engineer, in such a case, shall study the objection and submit his findings to the Employer.

65 Variations If the Engineer feels the necessity to make any variations of the form, quality or quantity of the Works he has the authority to instruct the Contractor to do so and the Contractor shall do any of the following: a) Increase or decrease the quantity of any work included in the contract. b) Omit any such work (but not if the omitted work is to be carried out by the Employer or by another contractor). c) Change the character or quality or kind of any such work. d) Change the levels, lines, position and dimensions of any part of the works. e) Execute additional work of any kind necessary for the completion of the works. f) Change sequence or timing of construction. Note : Max Allowable variation by Fidic is 15%, but in Palestinian Contracting contract is 20%.

The Contractor is not supposed to make any variation without an instruction of the Engineer. No instructions are required if work execution results into increase/decrease of quantities than those stated in the Bill of quantities. VALUATION OF VARIATIONS All variations and any additions to the Contract Price shall be as per the rates and price of variations present in the Contract. If the Contract does not contain any rates or prices applicable to varied work, the rates and prices of the Contract shall be used as the basis for valuation. In the event of disagreement the Engineer shall notify the Contractor with a copy to the Employer. Till the time the rates are agreed or fixed, the Engineer shall determine provisional rates or prices to enable on-account payments to be included in certificates issued

The Engineer shall determine the rate for varied work if existing rates in the contract are inappropriate, in consultation with Employer and Contractor. If agreement is not reached on the rates, the engineer shall fix provisional rates which are appropriate in his opinion, to enable on account payment for payment certificates issued under clause of payment, until such time as rates or prices are agreed, provided Contractor or engineer has given notice of 14 days to each other about their intention to seek varied rates. VARIATIONS EXCEEDING 15 PERCENT If, on the issue of the Taking-Over Certificate for the Whole of the Works, it is found that as a result of: a) All varied work valued (cases listed in the start of variation) b) all adjustments upon measurement of the estimated quantities set out in the Bill Of Quantities, excluding Provisional Sums, day works and adjustments of price made under Clause of increase or decrease of the cost (There shall be increase/decrease in contract price based on rise and fall in cost of labor and material as provided in the part II of these conditions) that the contract price has varied in excess of 15% then Engineer will decide increase/decrease to contract price having regards to Contractor’s site and general overhead cost. This change if any shall be related to 15% excess level over contract price. DAY WORK The Engineer if he feels that it is necessary, can issue a instruction that any varied work shall be executed on a day work basis according to the term’s and conditions provided in the day work schedule.

68 PROVISIONAL SUM DEFINITION “Provisional Sum” means a sum (if any) which is specified in the contract as a provisional sum. Provisional Sum shall only be used in whole or in part, in accordance with the Engineers instructions and the Contract Price shall be adjusted accordingly. USE OF PROVISIONAL SUMS The engineer shall have authority to issue instruction for the execution of work or for supply of goods or services under provisional sum.

69 MONTHLY STATEMENTS The contractor shall submit to the Engineer after the end of each month six copies of statements showing the amounts to which the contractor considers himself to be entitled up to the end of the month in respect of: a) The value of the permanent work. b) Any other item in the Bill of Quantities including those for contractor’s equipment. c) And plant delivery by the contractor on the sire for incorporation in the permanent works but not incorporated in such works. d) Adjustment under the increase or decrease the cost. e) Any other sum to which the contractor may be entitled under the contract.

70 MONTHLY PAYMENTS The Engineer shall, within 28 days of receiving such statement, deliver to the employer an interim payment certificate stating the amount of payment due to the contractor subject. a) Firstly to retention of the amount calculated by applying the percentage of retention stated in the appendix to tender until the amount so retained reaches the limit or retention money stated in the appendix to Tender. b) Secondly to the deduction other than pursuant to liquidated damages for delay of any sums which may have become due and payable by the contractor to the Employer. Provided that the engineer shall not be bound to certify any payment in the net amount thereof, after the retention and deduction, would be less than the minimum Amount of interim payment certificate stated in the appendix to tender. PAYMENT OF RETENTION MONEY a) Upon the issue of the taking-Over Certificate with respect to the whole of the works, one half of the retention money, shall be certified by the Engineer for payment to the Contractor. b) Upon the expiration of the Defect Liability Period for the work other half of the Retention Money shall be certified by the Engineer for payment to the contractor. The expression “expiration of the Defect Liability Period” shall for the purpose of the clause, be deemed to mean the expiration of the latest of such periods provided also that if at such time there shall remain to be executed by the contractor any work instructed, pursuant to clause 49 and 50 in respect of the works the Engineer shall be entitled to withhold certification until completion of such work.

The Engineer May in any interim Payment Certificate carryout any correction or modification in any previous Interim Payment Certificate. STATEMENT AT COMPLETION Not later than 84 days after the issue of the Taking-Over Certificate in respect of the whole of the works, the contractor shall submit to the Engineer six copies of Statement of completion showing in detail, a) The final value of all work done b) Any further sums which the contractor considerers to be due and c) An estimate of amount which contractor considers will become due. The engineer shall certify payment FINAL STATEMENT Not later than 56 days after the issue of Defect Liability Certificate the contractor shall submit to the Engineer for six copies of draft final statement showing in detail. a) The value of all the work done in accordance with the contract b) Any further sum which contractor consider to be due to him. If the Engineer disagree or cannot verify any part of draft final statement, contractor shall submit any further information required. The Engineer shall deliver to the Employer an Interim Payment Certificate for those part of the draft final statement, which are not in dispute.

72 DISCHARGE Upon submission of final statement, the contractor shall give to the Employer, written discharge confirming that the total of the final statement represent full and final settlement of all monies due to the contractor. Provided that such discharge become effective only after payment due under the final payment certificate has been paid to the contractor and the performance security is returned. FINAL PAYMENT CERTIFICATE Within 28 days after receipt of final statement, and written discharge the Engineer shall issue a final payment certificate stating: a) The amount which is finally due under the contract . b) After giving credit to Employer for all amount previously paid other than under clause 47 and all sums to which Employer is entitled under the contract. CESSATION OF EMPLOYER’S LIABILITY The employer shall not be liable to the contractor connection with the contract or execution of the work unless the contractor shall have included a claim in respect thereof in his final statement. TIME OF PAYMENT i. The amount due to the Contractor under any interim Certificate issued by the Engineer be paid by Employer to the contractor within 56 days. ii. Final payment Certificate within 56 days after such Final Payment Certificate has been delivered to the Employer. In the event of the failure of employer to make the payment within the time stated the Employer shall pay contractor interest at the rate stated in appendix to tender


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