01/04/2002
Pipeline Induction Heat Ltd
General Conditions of Contract
The following General Conditions shall be incorporated in all Contracts made between the CONTRACTOR and another party.
GC-1 DEFINITIONS
CONTRACTOR means Pipeline Induction Heat Ltd (PIH).
The BUYER means the Main Contractor, his Subcontractor, Employer, Owner or
other party or entity entering into a contract with PIH.
COMPENSATION means the lump sum prices or quantified schedule of rates set
out within the CONTRACTOR’S bid.
SERVICES means the services or goods which are the subject matter of the
Contract.
OWNER means the end user of the site, plant equipment or pipeline into which the
SERVICES shall be incorporated.
GC-2 ENTIRE AGREEMENT
These General Conditions of Contract including the Special Conditions and other
documents or drawings agreed to in writing by the CONTRACTOR shall constitute
the entire agreement between the CONTRACTOR and the BUYER. No change,
amendment or modification to the SERVICES shall be valid unless agreed in writing
by the CONTRACTOR.
GC-3 SCOPE OF SERVICES
The scope of the SERVICES shall be limited to the extent of the services set out in
the CONTRACTOR’S bid.
GC-4 HEALTH AND SAFETY
The CONTRACTOR operates a Health and Safety Policy in accordance with U.K.
legislation, where the project requires this is supplemented with Offshore Survival
Training at approved centres. The CONTRACTOR shall provide a copy of its Health
and Safety Policy at the BUYER’S request.
GC-5 DESIGN
Unless other wise stated in the scope of the SERVICES the CONTRACTOR shall
not be responsible for the design or selection of the SERVICES nor their suitability
or fitness for the purpose of the BUYER.
GC-6 COMPENSATION
(a) The CONTRACTOR shall be compensated at the lumps sums, rates and prices set
out in the CONTRACTOR’S bid. Where the CONTRACTOR has agreed to carry
out additional or varied SERVICES then the CONTRACTOR shall receive
COMPENSATION in accordance with the bid for like or analogous SERVICES, or
where no applicable COMPENSATION is stated, at lump sums, rates and prices that
are fair and reasonable in all the circumstances.
(b)Unless stated otherwise on PIH proposal/quotation document the validity of prices
submitted expires 30 days from the date of the proposal/quotation.
In the case of multiple items the proposal/quotation is for the whole consignment to
be manufactured and delivered as a single lot. Please note that Part Orders will
attract a surcharge.
GC-7 PAYMENT
The BUYER shall compensate the CONTRACTOR in the full value of the
CONTRACTOR’s invoice within 30 days following the end of the month in which
the CONTRACTOR’S invoice is dated. Should the BUYER dispute the
CONTRACTOR’S invoice in whole or in part then the BUYER shall, within 7 days
of receipt of the CONTRACTOR’S invoice notify the CONTRACTOR of the
disputed items and values and the undisputed monies shall be paid in accordance
with these General Conditions. In respect of the disputed items both the
CONTRACTOR and BUYER agree to use their best endeavours to reach an
amicable settlement, failing which the matter shall be referred in accordance with
DISPUTES clause below. Following agreement of the disputed items payment shall
be made as stated herein.
The CONTRACTOR reserves the right and the BUYER agrees to compensate the
CONTRACTOR for payments not made by the due date at the Bank of Boston
corporate lending rate plus 5% per annum, such compensation being due
immediately upon receipt of the CONTRACTOR’S invoice by the BUYER. No
deductions or set off shall be made by the BUYER from any monies due to the
CONTRACTOR without the CONTRACTOR’S prior agreement in writing.
GC-8 COMMENCEMENT AND COMPLETION
The CONTRACTOR shall not be obliged to undertake any work or provide any
equipment or materials until the Contract has been executed with the BUYER.
The BUYER shall give the CONTRACTOR in writing the minimum notice to
commence set out in the CONTRACTOR’S bid, which shall be commensurate with
the nature and geographical location of the SERVICES. In no circumstances shall
such period of notice to commence be less than 4 weeks.
Where the nature of the SERVICES requires repeated mobilisations then the
BUYER shall give the CONTRACTOR, after the initial mobilisation, an achievable
and agreed period of notice in writing which shall, in any event be not less than 7
days for U.K. SERVICES and 30 days for overseas SERVICES.
The CONTRACTOR shall make it’s best endeavours to complete within the agreed
timescale but shall not be responsible for any failure to do so for reasons, howsoever
arising, beyond it’s control including but not limited to CHANGES in the scope of
SERVICES and revisions to the BUYER’S construction schedules.
The CONTRACTOR shall not be liable to compensate the BUYER for any interim
or final disruption or delay in the performance of the SERVICES.
GC-9 FORCE MAJEURE
Any delay or failure by the CONTRACTOR in performance of the SERVICES shall
be excused if and to the extent caused by FORCE MAJEURE which shall include
but not be limited to, acts of God, strikes, fire, flood, storms, sandstorms,
exceptionally severe weather, sabotage, terrorism or acts of war or riot, whether
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officially declared or not, changes to governmental laws, legislation or regulations or
other causes beyond the control of the CONTRACTOR which impinge upon the
CONTRACTOR’S ability to carry out the works.
As soon as is practicably ascertainable after the occurrence of a FORCE MAJEURE
event, the CONTRACTOR shall notify the BUYER of the cause of the delay or
suspension and the period for the performance of the SERVICES shall be extended
for a period of time reasonably necessary to overcome the effects of the FORCE
MAJEURE and the CONTRACTOR shall be reimbursed for the cost of such delays.
GC-10 CONSEQUENTIAL LOSS
Neither party to the contract shall be liable each to the other for any consequential
loss arising from this contract.
GC-11 IN-COUNTRY EXPENSES
When the SERVICES are to be performed outside the U.K. the BUYER shall be
responsible for and indemnify the CONTRACTOR in accordance with
“INDEMNITY” against all in-country expenses (except as may be expressly
provided in the CONTRACTOR’S bid) and including but not limited to, customs
duties, taxes, levies, drawback cargo charges and the like charges for the import
and/or re-export of all items associated with the SERVICES.
GC-12 IN-COUNTRY TAXATION
Where the SERVICES are to be performed outside the U.K. the BUYER shall be
responsible for and indemnify the CONTRACTOR in accordance with
“INDEMNITY” against all in-country taxation on the SERVICES in general,
personnel taxation, VAT or equivalent, withholding tax and any other taxes, levies,
duties or fiscal demands made by any government, public, local authority, police,
military or similar organisation in the country in which the SERVICES are to be
performed.
GC-13 IN-COUNTRY TRANSPORTATION
The BUYER shall be responsible for the provision of all in-country and within job
site limits transportation of the CONTRACTOR’S plant, equipment, consumables
and personnel associated with the performance of the SERVICES.
GC-14 INDEMNITY
The BUYER hereby releases and shall indemnify, defend and hold harmless
CONTRACTOR and his subsidiaries, affiliates, officers, agents, employees,
successors and assigns and authorised representatives from and against any and all
suits, actions, legal, civil or administrative proceedings, claims demands, damages,
liabilities, interest, legal fees, costs and expenses of whatsoever nature, including
without limitation those arising from death or injury to the BUYER’S employees,
whether arising before or after completion of the SERVICES and in any manner
directly or indirectly caused, occasioned or contributed to in whole or in part, by
reason of any act, omission, fault or negligence whether active or passive of the
BUYER, OWNER, their lower tier subcontractors or suppliers or of anyone acting
under its’ direction or control or on it’s behalf in connection with or incidental to the
performance of the SERVICES.
GC-15 INSURANCES
The CONTRACTOR shall effect and maintain for the duration of the SERVICES the
following insurances.
1) Employer Liability to the statutory limits in compliance with U.K. laws with a limit
of US$ 2,000,000 for each accident and for each employee.
2) Property damage for owned or rented plant, equipment and consumables. Where loss
or damage is attributable to the CONTRACTOR.
3) Commercial General Liability with an aggregate total limit of US$ 2,000,000.
4) Business Automobile including owned, non owned and hired automobiles
comprehensive with limits of US$ 1,000,000 any one occurrence and in aggregate.
Any and all other insurances necessary or deemed necessary by the BUYER or
OWNER shall be effected at their expense and maintained for the full duration of the
SERVICES, such insurances shall note the interests of the CONTRACTOR as a joint
assured and that a cross liability clause is inserted in all liability insurances.
All insurance policies effected by the CONTRACTOR and the BUYER or OWNER
shall contain a waiver of subrogation in favour of each party against the other. If so
requested each party shall furnish to the other Certificates of Insurance, signed by
the Insurers, as proof that policies have been issued and containing provisions
requiring prior notice of cancellation.
GC-16 WARRANTY
The CONTRACTOR warrants to the BUYER that equipment and materials
supplied under this contract shall be in accordance with the BUYER’S
specification, unless otherwise stated. All workmanship and training shall be
performed in accordance with recognised practices within the industry.
CONTRACTOR warrants materials and workmanship performed against defects
for a period from commencement of the SERVICES to a date 12 months after
completion of the SERVICES.
If at any time during the warranty period the BUYER discovers any defect in
materials and workmanship it shall notify the CONTRACTOR in writing. The
CONTRACTOR shall within a reasonable time propose corrective actions to
remedy the defect to meet the requirements of this contract.
The CONTRACTOR’S liability shall be limited, at its discretion, to the repair or
replacement of the defect. Excavation, creating access for repair or replacement and
afterwards backfilling and re-instating including the costs of any permits, way
leaves, licences, inspection, testing, loss of product or production shall be borne by
the BUYER. The CONTRACTOR accepts no liability for the loss of use of any
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pipeline or equipment or product carried therein due to defects or the discovery and
remedy thereof in workmanship and material.
The CONTRACTOR further warrants any remedial work it performs to correct
defects for a further period of 12 months from completion of the corrective action.
Where the scope of the SERVICES includes the provision of ready manufactured
plant or equipment the CONTRACTOR’S liability will be limited to the warranty
or remedy recoverable from the manufacturer.
The only warranties made by the CONTRACTOR are those stated in this clause
GC-14 and all other warranties are expressly excluded.
GC–17YEAR 2000 COMPLIANCE
Notwithstanding the provisions of Article 16 above the CONTRACTOR shall have
no liability to the BUYER or any THIRD PARTY in respect of failure to perform
any or all of its obligations under these General Conditions at law or in
tort, where the breach or failure to perform is attributable directly or indirectly to
an event or events arising from Year 2000.The CONTRACTOR shall not be liable
for any direct, indirect loss or damages, consequential loss, loss of profits,
production or replacement of any completed work or goods supplied or any other
costs, charges or expenses howsoever arising from Year 2000.
GC-18 TITLE
Where the services comprise the sale of equipment or consumables to the BUYER,
then title in the SERVICES shall be vested in the CONTRACTOR until payment in
full, has been made by the BUYER. The CONTRACTOR shall be entitled to
recover, and the BUYER agrees to surrender the SERVICES if payment is not
made in accordance with this contract.
The BUYER agrees not to transfer title in the SERVICES until after the transfer
has been made from the CONTRACTOR to the BUYER.
GC-19 TERMINATION
Either party may terminate this contract by written notice to the other party upon
the other party becoming insolvent or committing any act of bankruptcy.
TERMINATION BY THE CONTRACTOR
In the event of any material breach or default under this contract by the BUYER
including but not limited to failure to commence the works or instruct mobilisation
of the CONTRACTOR or failure to make payment by the due date the
CONTRACTOR may give notice in writing of it’s intention to terminate the
contract, specifying the grounds for termination unless such breach or default shall
be remedied by the BUYER within 21 days after the notice is received
TERMINATION BY THE BUYER
Should the BUYER seek to terminate the contract for any reason whatsoever, then
the BUYER shall give notice in writing to the CONTRACTOR 21 days in advance
of the date of termination and specifying the reasons for the termination. Where the
intention to terminate the contract arises from the alleged default of the
CONTRACTOR then the CONTRACTOR shall be given 21 days from receipt of
the notice to remedy the defect or to issue a commitment so to do.
In the event that either the BUYER or CONTRACTOR terminates the contract,
except for reason of the CONTRACTOR’S default, the CONTRACTOR shall be
compensated as follows:-
1) Immediate payment in accordance with COMPENSATION for all work properly
completed.
2) The full cost including delivery and disposal charges of all consumables properly
purchased for the SERVICES.
3) The cancellation costs of all irrevocable purchase orders, subcontracts or other
Agreements entered into for the performance of the SERVICES.
4) The costs of demobilisation of all the CONTRACTOR’S personnel, plant
equipment and residual items related to the SERVICES.
5) In addition to items (2)-(4) above a sum equal to 35% of the value of the
unperformed SERVICES which is agreed to be a reasonable estimate of the
CONTRACTOR’S overheads, administration, loss and damage due to termination
of the contract.
Following termination of the contract by either party the BUYER shall bear the
sole responsibility for the security and safekeeping of the CONTRACTOR’S
property until safely demobilised from the country where the SERVICES were to
be performed.
No termination of this contract shall relieve the BUYER of his obligations that
have accrued prior to termination.
GC-20 SUSPENSION
Should the BUYER suspend the performance of the SERVICES for any reason
whatsoever the CONTRACTOR shall be compensated for the costs of the
suspension period as follows:-
1) Standby rates for personnel and equipment in accordance with COMPENSATION
for the period from cessation of the SERVICES until recommencement of the
SERVICES.
2) Demobilisation and re-mobilisation charges in accordance with COMPENSATION
schedule.
3) All other costs incurred by the CONTRACTOR that flow from the suspension of
the SERVICES.
4) Should the period of suspension exceed 90 days then either party may terminate the
contract by giving the other party 21 days written notice. Should the contract be
terminated for this reason the CONTRACTOR shall be compensated in accordance
with Article GC15 “Termination by the BUYER” (1) -(7).
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GC-21 ASSIGNMENT
The BUYER shall not assign or novate this contract without prior written notice to,
and agreement of the CONTRACTOR. Following any assignment or novation of
this contract the BUYER shall remain responsible for the discharge in full of all
debts due to the CONTRACTOR for SERVICES under this contract.
GC-22 SECURITY
The BUYER shall at all times be responsible for the security of the
CONTRACTOR’S personnel, equipment and materials and shall indemnify the
CONTRACTOR as set out in “INDEMNITY”. Where the CONTRACTOR
considers that his personnel or property are at risk from insurgence or unrest at the
CONTRACTOR’S first request the BUYER will take immediate steps to evacuate
the CONTRACTOR’S personnel and property to a place of safety at the BUYERS
cost. When the cause for the evacuation has ceased to exist and it is safe to do so,
the CONTRACTOR shall re-mobilise to complete the SERVICES and be paid for
such remobilisation in accordance with COMPENSATION.
GC-23 CONFIDENTIALITY
The BUYER accepts that the CONTRACTOR’S bid and other documents as may
be supplied by the CONTRACTOR and the execution of the SERVICES may
disclose confidential information, trade secrets or trade know-how and the BUYER
agrees not to divulge such confidential matters to others or to bring them into the
public domain without the prior written agreement of the CONTRACTOR.
Photographs or promotional literature showing the CONTRACTOR’S equipment,
working methods or describing the same shall not be published without consent of
the CONTRACTOR in writing.
GC-24 NON-WAIVER
Failure by the CONTRACTOR to insist upon strict performance of any conditions
of this contract, or failure or delay to exercise any rights or remedies provided
herein or by law or failure to properly notify the BUYER of any obligations under
this contract shall not be deemed a waiver of any right of the CONTRACTOR to
insist upon any of it’s rights or remedies as to any prior or subsequent default or
operate as a waiver of any Conditions of this contract.
GC –25 SEVERABILITY
Any provision or part of this contract held to be void shall be struck out and all the
remaining conditions shall continue to be binding on both the CONTRACTOR
and the BUYER
GC-26 DISPUTES
In the event of any difference or dispute arising under this contract the parties agree
to use their best endeavours to reach an amicable settlement. The party raising the
difference or dispute shall, within 7 days of the difference or dispute coming into
existence give written notice to the other party detailing the nature of the difference
or dispute and specifying the remedy required. Within a further 7 days each party
shall nominate a senior member of management with authority to settle the
difference who will meet within 42 days of receipt of the written notice of the
difference or dispute. If the parties cannot reach an amicable settlement then
within 56 days from the date of the written notice of the difference or dispute, the
dispute shall be referred to mediation at a date agreed between the parties or in the
event of their failing to agree a date fixed by the mediator. The parties will convene
to agree the name of a mediator within 56 days of the date of the written notice of
dispute or difference and if they cannot reach agreement within 14 days of this date
a nomination shall be sought from CEDR [Centre for Effective Dispute Resolution,
London]. If a mediated settlement cannot be achieved then the difference or dispute
shall be referred to arbitration in accordance with the then existing Rules of
Conciliation and Arbitration of the International Chamber of Commerce. The place
of arbitration shall be Manchester, England and the proceedings and all
documentation shall be in the English Language. Judgement upon the Arbitrator’s
award, which shall be final and binding may be entered in any Court having
jurisdiction over the assets of the debtor party.
GC-27 NOTICES
All notices concerning this contract shall be issued in writing to the
CONTRACTOR at Pipeline Induction Heat Ltd, The Pipeline Centre, Farrington
Road, Rossendale Road Industrial Estate, Burnley, Lancashire BB11 5SW,
England, and unless stated otherwise to the BUYER at it’s registered office.
GC-28 GOVERNING LAW
These Conditions of Contract shall be governed and interpreted in accordance with
the laws of England and Wales. The language of the Contract shall be the English
Language.