CONSTRUCTION CONTRACTS DOCUEMENTS

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CONSTRUCTION CONTRACTS DOCUEMENTS
BYLECTURERMaha Muhaisen

• APPLIED CIVIL ENGINEERING DEPT

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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

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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

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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 www.fidic.org

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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

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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)

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FIDIC Document UsageConditions of Contract for
Construction

• Works designed by Employer or Engineer
• Contractor Constructs in accordance with designs
  provided
• May include some design elements

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FIDIC Document UsageConditions 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 Employers Requirements
• Engineer Administers

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FIDIC Document UsageShort Form of Contract

• Small capital value projects
• Simple content
• Contractor constructs to Employers designs
• No Particular Conditions
• No Impartial Engineer

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Typical sequence of Principal Events during
Contracts
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Typical sequence of Payment Events envisaged in
Clause 14(contract price and payment)
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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)
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FIDIC conditions of contract

• 1 GENERAL PROVISIONS
• 2 THE EMPLOYER .
• 3 THE ENGINEER
• 4 THE CONTRACTOR
• 5 NOMINATED SUBCONTRACTORS
• 6 STAFF AND LABOUR
• 7 PLANT, MATERIALS AND WORKMANSHIP
• 8 COMMENCEMENT, DELAYS AND SUSPENSION
• 9 TESTS ON COMPLETION
• 10 EMPLOYERS TAKING OVER .
• 11 DEFECTS LIABILITY
• 12 MEASUREMENT AND EVALUATION

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FIDIC conditions of contract (contd)

• 13 VARIATIONS AND ADJUSTMENTS
• 14 CONTRACT PRICE AND PAYMENT
• 15 TERMINATION BY EMPLOYER
• 16 SUSPENSION AND TERMINATION BY CONTRACTOR
• 17 RISK AND RESPONSIBILITY
• 18 INSURANCE
• 19 FORCE MAJEURE
• 20 CLAIMS, DISPUTES AND ARBITRATION

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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 Employers Use of Contractors Documents
• 1.11 Contractors Use of Employers Documents
• 1.12 Confidential Details
• 1.13 Compliance with Laws
• 1.14 Joint and Several Liability

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FIDIC conditions of contract contd

• 2 THE EMPLOYER .
• 2.1 Right of Access to the Site
• 2.2 Permits, Licenses or Approvals
• 2.3 Employers Personnel
• 2.4 Employers Financial Arrangements
• 2.5 Employers Claims
• 3 THE ENGINEER
• 3.1 Engineers Duties and Authority
• 3.2 Delegation by the Engineer
• 3.3 Instructions of the Engineer
• 3.4 Replacement of the Engineer
• 3.5 Determinations

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FIDIC conditions of contract contd

• 4 THE CONTRACTOR
• 4.1 Contractors General Obligations
• 4.2 Performance Security
• 4.3 Contractors 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

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• 4.14 Avoidance of Interference
• 4.15 Access Route
• 4.16 Transport of Goods
• 4.17 Contractors Equipment
• 4.18 Protection of the Environment
• 4.19 Electricity, Water and Gas
• 4.20 Employers Equipment and Free-Issue Material
• 4.21 Progress Reports
• 4.22 Security of the Site
• 4.23 Contractors Operations on Site
• 4.24 Fossils

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• 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

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• 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 Contractors Superintendence
• 6.9 Contractors Personnel
• 6.10 Records of Contractors Personnel and
  Equipment
• 6.11 Disorderly Conduct
• 6.12 Foreign Personnel
• 6.13 Supply of Foodstuffs

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• 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

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• 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

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• 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 Contractors Obligations
• 9.2 Delayed Tests
• 9.3 Retesting
• 9.4 Failure to Pass Tests on Completion
• 10 EMPLOYERS 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

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• 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
• 11.10 Unfulfilled Obligations
• 11.11 Clearance of Site

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• 12 MEASUREMENT AND EVALUATION .
• 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

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• 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
• 14.10 Statement at Completion
• 14.11 Application for Final Payment Certificate
• 14.12 Discharge
• 14.13 Issue of Final Payment Certificate
• 14.14 Cessation of Employers Liability
• 14.15 Currencies of Payment

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• 15 TERMINATION BY EMPLOYER
• 15.1 Notice to Correct
• 15.2 Termination by Employer
• 15.3 Valuation at Date of Termination
• 15.4 Payment after Termination
• 15.5 Employers Entitlement to Termination for
  Convenience
• 15.6 Corrupt or Fraudulent Practices

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

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• 18 INSURANCE
• 18.1 General Requirements for Insurances
• 18.2 Insurance for Works and Contractors
  Equipment
• 18.3 Insurance against Injury to Persons and
  Damage to Property
• 18.4 Insurance for Contractors 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

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• 20 CLAIMS, DISPUTES AND ARBITRATION
• 20.1 Contractors Claims
• 20.2 Appointment of the Dispute Board
• 20.3 Failure to Agree on the Composition of the
  Dispute Board
• 20.4 Obtaining Dispute Boards Decision
• 20.5 Amicable Settlement
• 20.6 Arbitration
• 20.7 Failure to Comply with Dispute Boards
  Decision
• 20.8 Expiry of Dispute Boards Appointment

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General conditions

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

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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,

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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.

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Definitions, Contd

• 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 Contractors 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)

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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

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• 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

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• 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 .

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Contractors 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 Engineers instructions, and shall
  remedy any defects in the Works.
• The Contractor shall provide the Plant and
  Contractors Documents specified in the Contract,
  and all Contractors 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 Contractors
  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.

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Contractors 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
  Contractors Documents for this part in
  accordance with the procedures specified in the
  Contract
• these Contractors Documents shall be in
  accordance with the Specification and Drawings,
  shall be written in the language for
  communications

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ASSIGNMENT AND SUBCONTRACTINGASSIGNMENT AND
SUBCONTRACTING

• 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.

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• 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.

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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.

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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.

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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.

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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.

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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.

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PROGRAMME TO BE SUBMITTED

• 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.

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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.

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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.

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• CONTRACTORS SUPERINTENDENCE
• 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 contractors obligations under the contract.
• If the approval of Contractors representative
  is withdrawn by the Engineer then Contractor
  shall replace him by any other representative
  approved by the Engineer.
• CONTRACTORS 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 Clients engineer having objection on the
  contractors 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.

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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 Contractors Equipment and other things
  brought to the site for a sum sufficient for its
  replacement.

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• 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

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• DAMAGE TO PERSONS AND PROPERTY
• 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

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• 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.

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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 Committees
  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.

66

• INSTRUCTIONS FOR VARIATIONS
• 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

67

• POWER OF ENGINEER TO FIX RATES
• 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 Contractors
  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 terms 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 contractors 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.

71

• CORRECTION OF CERTIFICATES
• 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 EMPLOYERS 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