Q&A: Force Majeure, Suspension of Works, Civil Law and FIDIC

In this blog post, Steering Committee member, Andy Hewitt, answers questions related to claims submissions during COVID-19. This blog has been extracted from our fifth Construction Clinic session, which took place in April of 2020. The entire webinar may be viewed on-demand on YouTube. Question 1 Question: Under the FIDIC contract, when the Engineer administers a contract in civil law jurisdictions, to make a determination for claims, what is the best way to deal with such rules of the common law as a time bar for Notices and prevention principles? Answer: For those unfamiliar with either civil law or FIDIC contracts, let me give you a bit of background. The FIDIC requirements have a lot of very stringent requirements for the Contractor to submit Notices and say very clearly and unequivocally that if the Contractor doesn’t submit the Notices within the timeframe, he is not entitled to anything. Now, if your contract was signed under a common law jurisdiction that is exactly what…

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Q&A: Prolongation, JCT, NEC, and Force Majeure

In our third Construction Clinic session, which took place in April 2020, Paul Gibbons answered questions related to prolongation and NEC and JCT contractual issues arising from COVID-19. The following questions have been excerpted from that session. The entire webinar may be viewed on-demand on YouTube. Question 1 Question: What is the remedy under the NEC3 Engineering Construction contract where there is a defect notified by the Employer, but this is a latent defect and notified after the defects date. Is the Contractor obliged to correct this? Answer: The NEC3 sets out the obligations of the Project Manager and the Contractor. The obligations related to notifications of defects are set out in clause 42. The Contractor’s obligations in terms of dealing with and resolving the defect is set out in clause 43. With latent defects after the defects date, it is the Contractor’s responsibility until the end of the limitation period under English law, which is either 6 or 12 years depending…

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Q&A: Delays, Notice, and Force Majeure

The following questions, related to contractual issues arising from COVID-19, were posed during our second Construction Clinic, held in April 2020. The entire webinar may be viewed on-demand on YouTube. Question 1 Question: Where is the coronavirus categorized under FIDIC Red Book with regard to the payment of costs? Answer: When it comes to payment of costs associated with the EoT, or any other costs associated with the coronavirus, the most appropriate place is Sub-Clause 19 (Force Majeure), but there are some qualifications and FIDIC aren’t really clear about epidemics here. Sub-Clause 19 (Definition of Force Majeure) states, “Force Majeure may include, but is not limited … of the kind listed” and the kinds that FIDIC refer to in the list are all man-made things such as hostilities, war, taking over of power, etc. etc. So, it doesn’t tick that box. Where it says it’s not limited to those things, does that mean there are other man-made things, or does that mean it could be anything…

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Notices: Should a Contractor Submit if He is Not Sure Whether He Intends to Make a Claim?

A blog follower recently asked for advice on the correct interpretation of FIDIC Sub-Clause 20.1 (Contractor’s Claims) with regard to situations where the Contractor is not sure if he will submit a claim or not. It’s not unusual for the Contractor to become aware of an event that may cause delay, the occurrence of additional Cost, or entitlement for additional payment. However, he may not be aware of the final effect of the event at the time that he becomes aware of the issue. For example, perhaps a delay will end before it affects the Time for Completion or perhaps an instruction received will not constitute a variation which will change a lump sum contract or, possibly, the Contractor will just decide that the value of the claim will not justify the time and cost involved in preparing it. The wording of the first part of this clause is as follows: ‘If the Contractor considers himself to be entitled to any extension of the Time for Completion and/or any additional payment, under any…

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FIDIC Red Book: Delayed Drawings and Instructions and Engineer’s Delay, Impediment and Prevention

One of the modules on the Construction Claims Premium E-Course delivered by ICCP training partners, Claims Class, asks students to review various case studies to identify potential claims. Having identified the claims, students are asked to explain the reasons for the claim, what may be claimed, the contractual clauses under the FIDIC Red Book that provide entitlement and explain how the claim would be evaluated. Having completed the module, a student asked me - his tutor - some questions which I think are worth sharing with the broader community. QUESTION 1: Could Sub-Clause 1.9 be used against RFIs (requests for information), shop drawings, material submittals, or any sort of instruction / information? Sub-Clause 1.9 (Delayed Drawings or Instructions) provides that ‘The Contractor shall give notice to the Engineer whenever the Works are likely to be delayed or disrupted if a necessary drawing or instruction is not issued … within a particular time’. The sub-clause allows the…

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