Notices under FIDIC Red, Yellow, and Silver 2017 Editions Part 5

This is final post in a multi-part addendum to our previous series on notices under FIDIC Silver Book 2017. This post will focus on some major changes to Clauses 14-20 in the Red and Yellow Books.

Sub-Clause 14.6.1 (Notice of Interim Payment) in the Silver Book states that within 28 days after receiving a statement and supporting documents, the Employer must give a notice to the Contractor stating the amount which the Employer fairly considers to be due for the interim payment.

However, in the Red and Yellow Books, Sub-Clause 14.6.1 (Interim Payment Certificate) requires the Engineer, within 28 days after receiving a statement and supporting documents, to issue an Interim Payment Certificate to the Employer and provide a copy to the Contractor.

Similarly, according to the Silver Book Sub-Clause 14.13 (Final Payment), within 28 days after receiving the final statement, the Employer shall give a notice to the Contractor. Whereas in the Red and Yellow Books, under Sub-Clause 14.13 (Issue of Final Payment Certificate) the Engineer shall issue the final payment certificate to the Employer with a copy to the Contractor within 28 days after receiving the final statement.

According to Sub-Clause 14.13 (Issue of Final Payment Certificate) in the Red and Yellow Books and (Final Payment) in the Silver Book. If the Contractor has not submitted a draft final statement within the time specified under Sub-Clause 14.11.1 (Draft Final Statement), the Employer/Engineer shall request the Contractor to do so.

Thereafter, if the Contractor fails to submit a draft final statement within a period of 28 days,
• according to the Red and Yellow Books, the Engineer shall issue the final payment certificate for such an amount as the Engineer fairly considers to be due.
• according to the Silver Book, within a further 28 days after this time limit has expired, the Employer shall give a notice to the Contractor stating the final payment with detailed supporting particulars.

Sub-Clause 18.5 (Optional Termination). In the Silver book, the Employer shall issue a notice under Sub-Clause 14.6.1 (Notice of Interim Payment), for the amount agreed or determined without the need for the Contractor to submit a statement.

The Red and Yellow Books have no notice version here. However, the Engineer shall issue a payment certificate under Sub-Clause 14.6 (Issue of Interim Payment Certificate) for the amount agreed or determined without the need for the Contractor to submit a statement.

In all three books, not later than 28 days after the claiming party becomes aware of the event, the claiming party shall give a notice to the other party describing details for which the claim is made as stated in Sub-Clause 20.2.1 (Notice of Claim) and the other party shall, within 14 days after receiving the notice of claim, give a notice to the claiming party accordingly with reasons as stated in Sub-Clause 20.2.2 (Initial Response) and if there is no notice issued within 14 days, the notice of claims shall be deemed to be a valid notice.

In the Red and Yellow Books, this continues further and states that if the other party disagrees with such deemed valid notice of claim, the other party shall give a notice to the Engineer which shall include details of the disagreement. Thereafter, the agreement or determination of the claim under Sub-Clause 20.2.5 (Agreement or Determination of the Claim) shall include a review by the Engineer of such disagreement.

This guest post was written by Mansoor Ali, FICCP and Jishma Joy. This post was originally published as a LinkedIn video, viewable here. The previous posts can be read at these links:
Clauses 1-3
Clause 4-5
Clauses 10-11
Clause 12

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