Professional Documents
Culture Documents
1 !"je#ti$es
1.1 Primary objective of this course is to: a. Provide a clear understanding & practical working knowledge of the FI I! !onditions "f !ontract For #uilding and $ngineering %orks designed by the $mployer 1st $dition& 1''' (hereinafter referred to as FI I!)''* together with the likely +default+ legal remedies , position in the event of %ika+s failure to comply with their contractual obligations regarding the determination of e-tension of time (hereinafter referred to as $".*. b. $nable each of you to recogni/e and understand e-tension of time claim events and present , defend them properly. c. Instill the knowledge& confidence and understanding necessary to enforce and protect , defend %ika)s rights with regard to $".. 1.0 .he above objectives will be achieved by e-plaining the following: a. 1ow the submission of claims should be correctly perceived. b. .he purpose of $".. c. .he FI I! events that give rise to an $".. d. .he FI I! notification procedures and submission re2uirements. e. 3epercussions of failure to comply with the notification re2uirements. f. 4ethod of 2uantification of delay. g. .he purpose of the programme& its contractual standing & obligation to follow it. h. .he ownership of float. i. j. .he scope of a !ontractor)s obligation to mitigate delay. .he effect of concurrent delay.
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0.1 .he submission of claim details by a !ontractor are : a* Inevitable , e-pected. b* 6 contractual obligation. 1ence& it is wrong that they should be perceived as a bad thing. 0.0 %hy 6re !laims Inevitable7 a. !onstruction !ontracts are notorious for being poorly drafted documents (riddled with inconsistencies& which can only be partly e-cused by the huge volume of documentation that constitutes a construction contract and the fact that each constituent is often prepared in parallel by disparate consultants over an unrealistically short period*. b. .he numerous factors that can affect the progress of the !onstruction process& itself& make it susceptible to change. 8ubmission of claims is the vehicle for managing each change in circumstance. c. .he $mployer has elected to bear the risk of some events and the !ontract re2uires that the !ontractor submit a claim to redress the affects. .herefore& compliance with the !ontract actually re2uires early and continuous submission of claim details. (If the $mployer wanted to eliminate all risk then the project should have been tendered on a lump sum& design & build basis*. 0.9 :otwithstanding the above& early notification of claims actually benefits the $mployer as it facilitates the ma-imum opportunity to manage the change in circumstances (change being inevitable in every construction project* and take the appropriate action i.e. instruction of acceleration or value engineering measures. 0.; 8ubmission of claim details (at least morally* prevents the < we dont have any budget defence= commonly stated by $mployer)s towards the completion of projects. 0.> FI I!& unlike some other standard forms& re2uires that the initial claim notification is copied to the $mployer. .herefore e-cuses regarding being unaware of a problem& or there no longer being sufficient budget should be unacceptable.
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9.1 6n e-tension of time has on,y 0 purposes. 1. eferral of levying of li2uidated damages. 0. Prevention of time becoming +at large+. 9.0 %hat is time at large7 .he effects of time being at large are twofold: a* ?i2uidated damages cannot be levied. b* .he !ontractor is only obliged to complete within a reasonable time. .he above is obviously against the $mployer)s best interests (no $mployer would want such circumstances to arise on their project*. 9.9 .here is a common misconception in the construction industry that once an $". has been determined& there will be an automati# entitlement to additional payment. FI I! is not drafted on this basis (entitlements to e-tension of time and additional payment are dealt with separately in FI I! (and for that matter almost all of the other standard forms of contract*. .herefore 0&ere a (ontra#tor is a0ar*e* an extension of time t&ere is no automati# rig&t to a**itiona, payment
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;.1 .he table below identifies all of the events in FI I! that give rise to $"..
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;.0.9.1 6ttempts are often made to reject !ontractor)s claims for unforeseeable
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8elf e-planatory
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;.0.E.1 6n adverse climatic condition i.e. a typhoon& does not& in itse,f& necessarily give rise to an $".. +easona",y 7pre*i#ta",e7 a*$erse #,imati# #on*itions are *eeme* to "e in#,u*e* 0it&in t&e (ontra#tor7s programme 't is on,y after un*ertaking a #ross #omparison of t&e #on*itions experien#e* against &istori#a, meteoro,ogi#a, *ata for t&e ,o#ation of t&e proje#t for t&at parti#u,ar time of year t&at a #,imati# #on*ition #an "e *etermine* as "eing 7ex#eptiona,7 ;.0.E.0 It is good practice to record both the actual climatic conditions and any delays due to these conditions on a daily basis and to agree such records on a periodic basis (weekly or monthly* with the $ngineer. .his will be vital in establishing the validity of any claim for adverse climatic conditions. ;.0.E.9 !lose analysis of the wording can be important. It should be noted that <adverse= and <inclement= do not mean the same thing. $-ceptionally good weather can cause delays to a project i.e. by causing a drought. 8uch conditions have been held to constitute an <adverse= condition but not an <inclement= condition i.e. in#,ement &as a narro0er s#ope t&an a*$erse . It is for this reason that the wording of many of the standard forms was revised to include for <adverse= in lieu of <inclement= conditions. ;.0.E.; .he actual versus planned timing of the %orks is irrelevant in determining $".. 6ttempts are often made to rebut a !ontractor+s claim for e-ceptionally adverse climatic conditions on the grounds that had the %orks been carried out at the time originally indicated in the programe& the conditions would not have affected the progress or completion of the works i.e. if the !ontractor+s progress had been in accordance with the programme then foundation works would have avoided the wet season. ;.0.E.> .he above argument is not valid. ;.0.E.E 't &as "een &e,* t&at t&e effe#ts of ex#eptiona,,y a*$erse #,imati# #on*itions s&ou,* "e assesse* regar*ing t&e time at 0&i#& t&e 0orks affe#te* are exe#ute*8 rat&er t&an at t&e time in*i#ate* on t&e programme (if any) for t&eir exe#ution. ;.0.E.@ .he above principle is not limited to adverse climatic conditions and would be valid in defence of any rebuttal on such grounds by the $ngineer& the $ngineer has wrongly contended that there is no $". on the basis that if the works were e-ecuted at the time stated in the original programme& there would have been
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8elf e-planatory. .his !lause is for the $mployer)s benefit& as it prevents time becoming +at large+. 1%; Spe#ia, (ir#umstan#es
4 1 Pro#e*ures >.1.1 :otice is to be submitted <within *2 days of the delaying event first arising=. >.1.0 Interim particulars are to be submitted < within *2 days, or such other reasonable time as may be agreed by the +ngineer = (for ongoing events& for ease of administration this can be achieved on a global basis i.e. make a global submission every 0B days& this can be merely a list& subject to the best available particulars having been previously submitted*. >.1.9 Final particulars must be <within 0B days of the end of the effe#ts resu,ting from the event= (therefore final particulars are not re2uired within 0B days of the cause itself ending& but& rather& within 0B days of it)s effects ending*. >.1.; It is submitted that the above conditions must& at the very least& be mirrored in subcontract conditions.
4 % ?ormat for <otifi#ations >.0.1 FI I! !lause 1.9 identifies that all notices& unless otherwise specified& < shall be in writing=. >.0.0 / minute of meeting 0i,, not "e #onstrue* as #onstituting a notifi#ation of #,aim.
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+e>uirements is ?ata, 441 (omp,ian#e 0it& t&e notifi#ation an* su"mission re>uirements is a #on*ition pre#e*ent to E!T in ?'D'( >.>.1.1 6 condition precedent is something which makes the rights or duties in a contract depend upon the happening of an event. .he right or duty does not arise until the condition is fulfilled. >.>.1.0 FI I! does not use the wording +condition precedent+ nor a derivative thereof. >.>.1.9 For a clause to constitute a condition precedent it is e-pected that it should state the precise time within which the notice is to be served and contain e-press language warning that unless the notice is served within the time prescribed the !ontractor will lose its rights under the clause. 44% Defau,t 5ega, +eme*y (T&e Pre$ention Prin#ip,e) :otwithstanding any dispute regarding conditions precedent to entitlement& by virtue of the +prevention principle+ (one cannot benefit from one)s own errors , wrong* it is submitted that it is a,0ays in the $mployer)s interests to award an e-tension of time in respect of any $mployer caused delay as entit,ement 0i,, ,ike,y exist $ia t&e go$erning ,a0 (:ote: .his rule must be observed by %ika staff in the administration of subcontracts*.
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@.1 .he purpose of records is to maintain an accurate and comprehensive record of project conditions and problems such that their impact may later be used to assist in: a* b* ispute avoidance. ispute settlement. arbitration& litigation etc. @.0 8ite management must ensure that there is written evidence of e$ery instruction from the $ngineer. FI I! !lause 9.9 identifies how verbal instructions should be managed. @.9 %ika+s site staff must be stringent in following the obligations in !lause 9.9. @.; In making any claim it is important to keep in mind the following 2uestion& how do you know that you have a claim if you cannot demonstrate entitlement7
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B.1 Prior to considering the programme it is important to note the !ontractor)s general obligations with respect to the completion of the %orks. a* It is the obligation of the !ontractor to proceed with the %orks so as to complete on or before the !ontract completion date. b* 1owever& t&e met&o*8 spee* an* timing of t&e a#ti$ities forming t&e (ontra#t s#ope are genera,,y ,eft to t&e (ontra#tor@s *is#retion8 su"je#t to any stipu,ate* a##eptan#e of met&o* an* 3 or programme B.0 .he interim determination of $". by the $ngineer should be a precursor to the submission of any revised programme re2uired pursuant to FI I! !lause B.9. B.9 6 properly detailed programme is vital (as this is the key document used to demonstrate entitlement to $".*.
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'.1 6ll prudent contractors allow some form of contingency within their programme to cater for !ontractor risk events and !ontractor errors. '.0 .here is no guaranteed rule regarding the ownership of float. .here are 0 schools of thought. '.0.1 Float belongs to the !ontractor. his ris# items which cannot be accurately predetermined in terms of time involvement, and also to provide time for correcting mista#es, then the float belongs to him and the employer or architect / engineer cannot ob1ect if later programming by the contractor absorbs it. '.0.0 Float belongs to the project (and hence is shared between both parties* and is used up on a first come first served basis. '.0.0.1 !lose analysis of the wording of the !ontract is important as& by inference& this can identify who will own the float i.e. if the wording only provides for an $". in the event that the delay actually affects the !ontract completion date then this infers that the Project owns the float. 3.*.).) 's a contractor will normally include float in his programme to accommodate
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