February 20, 2022
What’s the Difference Between a Claim Submitted to an Engineer and One Submitted to Arbitration?
I was recently asked if there are differences between claims submitted to the Engineer and those submitted for arbitration. My response was, “Yes, there frequently is, but there shouldn’t be.” Here is a very frequent scenario related to claims that explains why that is. The Contractor considers that he has a justifiable claim for either a significant amount of money or an extension of time which will negate delay damages. He delegates the claim preparation without determining whether the person has adequate qualifications or experience to prepare a claim to a suitable standard. The person given the responsibility does his/her best, but lacking the necessary experience and skills, the claim is not prepared to a good standard. The Engineer rejects the claim because: he can’t understand it it does not contain adequate information it is not substantiated, or it just does not prove that the claim is justifiable. Even an impartial Engineer would be correct to do so and a defensive…
December 20, 2020
How to Manage and Minimise the Submission of Spurious Claims
One of our blog readers asked for some suggestions as to how to effectively manage and minimise the submission of spurious contractor’s claims, which I thought would make an interesting subject for other readers, as well. Consultants need to spend a lot of time and effort to manage and respond to contractor’s claims, so to avoid wasted effort, it is worth making sure that this time and effort is devoted to justifiable claims and is not wasted on reviewing and responding to claims for which the contractor has no entitlement, or to those that have not been submitted in an appropriate manner to enable a proper review and response to be made. It must be remembered that the onus is on the claimant to prove the case and even though most contracts require the consultant to be fair and reasonable when responding to claims, this obligation does not extend to proving the contractor’s claim on the contractor’s behalf. Most forms of construction contract support this obligation and require the…
November 10, 2020
Types of Claims Q&A
In 2019, the ICCP's training partner, Claims Class, presented a series of monthly webinars on claims for the CIOB, based on the Construction Claims e-courses.* There were a good number of attendees. At the end of each webinar, participants were invited to ask questions. If time ran short during the webinar, attendees each received a collection of written responses to any questions which could not be covered in the allotted time. Hopefully, this will provide some useful insight to readers of our blogs. The following are questions and answers from the webinar on Types of Claim. This is a follow-up to the previous post, Contract Administration for Claims. Question 1 Question: Under the FIDIC suite of contracts (1999 edition) could you please advise what options the contractor has in case of force majeure conditions (i.e. Arab Spring in North Africa) if they continue to incur charges for the project. For instance, should the contractor continue to pay for renewing his Advance Payment…
October 20, 2020
Contract Administration for Claims
In 2019, the ICCP's training partner, Claims Class, presented a series of monthly webinars on claims for the CIOB, based on the Construction Claims courses.* There were a good number of attendees. At the end of the webinar, attendees were invited to ask questions. All attendees received written answers to the questions that could not be answered during the webinar's allotted time. The following are questions and answers from the webinar on Contract Administration for Claims. Hopefully, this will provide some useful insight to our readers. Question 1 Question: Would it constitute a claim event if the Engineer, within a reasonable time-frame (3 months), fails to review and respond (approve/disapprove or comment) to a Variation for additional cost and time submitted pursuant to an Engineer’s Instruction and after the Contractor implementing the change at site? Answer: You have not explained what it is that you have submitted, so I am going to assume that this consists of an evaluation of…
July 20, 2020
What Qualifies as Force Majeure Under FIDIC? 2020 Update
One of our blog subscribers requested advice on force majeure under the FIDIC Red or Yellow books. The good news is that the FIDIC force majeure clauses are nearly the same under the Red, Yellow, Silver, and Gold forms of contract, so the following is applicable to all of them. Sub-Clause 19.1 (Definition of Force Majeure) the Red Book states that: ‘In this Clause, "Force Majeure" means an exceptional event or circumstance: (a) which is beyond a Party's control, (b) which such Party could not reasonably have provided against before entering into the Contract, (c) which, having arisen, such Party could not reasonably have avoided overcome, and (d) which is not substantially attributable to the other Party.’ Thus, to qualify as a force majeure event, it has to tick all of the boxes (a) to (d) above. The clause, however, goes on to offer further definitions as follows: Force Majeure may include, but is not limited to, exceptional events or circumstances of the kind…