Workshop 1: Commencement Date

The Contract for a major roads project has been signed incorporating the 1999 FIDIC Conditions of Contract for
Construction and the Engineer has issued a notice giving the date to commence the Works. The Employer then
says that he is not ready to hand over the Site and the start of the Contract must be delayed until he is ready.

The Contractor replied that the Employer has no right to change the Commencement Date. Who is correct?
What are the relevant Contract Clauses?
Workshop 2: Approvals

Under Construction Contract Sub-Clause 2.2, take the case of the Contractor being prevented from commencing
works because an excavation permit was not issued until after he had commenced work on the Site. Under a FIDIC
contract, the Employer has to apply for the permit. The Employer in this case contended that the Contractor should
have been aware at the time of tender that no excavation permit had been issued and that such a permit would not
be issued until detailed shoring drawings had been provided. Further, the Employer continued that since the
Contractor was responsible for the shoring and bracing, these drawings should have been submitted by the
Contractor.

Is it correct that under the FIDIC conditions, the delay would be entirely the responsibility of the Contractor.
However, would the Contractor have been able to seek the Employer’s assistance in applying for the excavation
permit?
Workshop 3: Access

The Contractor for a highway project valued at USD 50 million under the FIDIC Construction Contract wrote to
the Engineer 20 days after the Contract Agreement was signed saying that his surveyors had been prevented from
entering the Site. A barricade had been erected at the entrance to the Site and a local resident was preventing
anyone from entering the Site. The Contractor said that his surveyors were unable to carry out a survey in
preparation for site clearance and so the whole project was at a standstill and he would submit a claim for an
extension of Time for Completion and additional costs.

The Engineer replied that the Contractor had not provided his Programme nor evidence of insurance polices and so
his claim was invalid.

The relevant Contract data (in the Appendix to Tender) were:

a) Contract Commencement notice given 8 days after the Contract Agreement. b) Access to Site in the Appendix to
Tender: 10 days.
c) Evidence of Insurance in the Appendix to Tender: 28 days

What are the relevant contract Sub-Clauses?

Was the Engineer correct to reject considering a claim?

Would the answer be different under the FIDIC Plant and Design-Build Contract?
Workshop 4: Failure to issue an IPC

Contract Agreement, under the FIDIC Construction Contract was signed on 1 February, with the Commencement
Date stated as 1 March. On 4 April the Contractor submitted an application for an interim payment.

On 18 April the Engineer replied that he did not intend to issue an Interim Payment Certificate. On what grounds
can the Engineer refuse to issue an Interim Payment Certificate?
Workshop 5: Variations

The Employer, on a FIDIC Construction Contract for a USD 30 million, placed a restriction on his Engineer in
terms of the following:

a) granting an Extension of Time (EoT);

b) increasing the Accepted Contract Price.

The Contractor received an instruction as a Variation from the Resident Engineer, to undertake additional work
which would have increased the Accepted Contract Price and required an EoT.

Should the Contractor comply? Which contract Sub-Clauses apply?

If the Contractor complied with the instruction and incurred costs of USD 250,000 before the Engineer reversed the
Resident Engineer’s decision on the grounds he did not have the authority to give this decision.

Was the Employer obliged to make additional payment to the Contractor?

Which sub-clauses applied if the Contractor was not paid and he wished to claim?
Workshop 6: Contractor’s claims

The route for a new road, being constructed under a 1999 FIDIC Construction Contract, ran along the side of a hill,
requiring excavation into the steep hillside. During excavation large rocks fell onto the road construction,
damaging a bulldozer and killing the driver. The bulldozer was so badly damaged that it had to be replaced. Some
of the rocks continued down the hillside and damaged a house that was located just off the Site.

The Contractor immediately notified the Engineer that he would seek additional payment for the cost of a new
bulldozer, the cost of repairing the road construction, the cost of the delay during the period when the police had
closed that part of the site for their investigation and the cost of delays to other parts of the road, which he was
unable to reach while the damaged section was closed, with extensions of time for each claim.

It is to be noted that:

a) the rocks were located outside the Site in thickly wooded area;

b) there had been heavy rain for three days prior to the incident.

What are the relevant contract sub-clauses?

What action should the Engineer take?
Workshop 7: Claims and Disputes

Under the Exercise 3, access to the Site was delayed for 3 months while the Employer negotiated with local
residents. The Engineer had issued a Suspension Notice under Sub-Clause 8.8 of the FIDIC contract.

The Contractor kept Contemporary Records of the claim, having given immediate notice of the event causing the
claim. The Engineer monitored the Contemporary Records but made no comments and did not keep any copies.
The Contractor submitted his claim amounting for USD 5 million, (10% off the Contract Amount), and an
extension of time of three months (20% of the Contract Period).

The Engineer, after 42 days, accepted the validity of the claim, but considered the additional cost to be totally
excessive. The Engineer agreed to certify an extra USD 0.5 Million and requested the Contractor to submit a
revised programme that only gave a one and one-half month Extension of Time.

Which sub-clauses apply?

What should the Contractor do?

Can a dispute be called by the Contractor before a Sub-Clause 3.5 determination or must the Engineer undertake a
Sub-Clause 3.5 determination first?