This is the final post in a four-part series on The Typical Sequence of Activities and Events under FIDIC. Parts one and two covered the FIDIC Red, Yellow and Silver 2017 editions, and part three began the FIDIC Gold 2008 edition with the lifecycle and payments. This post continues the sequence of activities and events in the Gold book and will be covering the determination, claims, and the settlement of disputes.

Determinations by the Employer’s Representative

Determination as per Sub-Clause 3.5 (Determinations by the Employer’s Representative) is quite straightforward. First, the Employer’s representative consults each party to reach an agreement. If there is no agreement, then a fair determination in accordance with the contract, taking due regard to all circumstances, is made. This is binding unless it is taken up under Clause 20 (Claims Disputes and Arbitration).

Contractor’s Claims – Submissions

As soon as (or within 28 days after) the Contractor becomes aware of a claim, the Contractor shall give notice to the Employer’s representative describing the event or circumstances giving rise to the claim for Extension of Time and or additional payment (Sub-Clause 20.1).

If the Contractor fails to give notice within 28 days, the Contractor shall have no entitlement unless overruled by the Dispute Adjudication Board (DAB) (Sub-Clause 20.1a). Contractors shall keep all contemporaneous records to substantiate the claims, permitting the Employer’s representative to inspect such records (Sub-Clause 20.1b).

Contractors shall submit details and particulars of the claim within 42 days after the Contractor becomes aware, including additional details as requested by the Employer’s representative (Sub-Clause 20.1c). If he fails to provide the base of the claim within the set 42 days (or other time allowed or approved), then the notice given shall be deemed to have lapsed and shall no longer be considered a valid notice unless overruled by the DAB.

Contractor’s Claims – Determinations

After receiving a fully detailed claim, the Employer’s representative shall proceed in accordance with Sub-Clause 3.5 (Determinations). For extensions of time and/or additional payment, the timeline is within 42 days (or an agreed period).

If the Employer’s representative does not respond in accordance with the timetable, either party may consider that the claim has been rejected by the Employer’s representative and either party may refer the matter to the DAB.

If a determination is made and either party is dissatisfied with it, then notice of dissatisfaction (NoD) is to be initiated within 28 days after receiving the determination (Sub-Clause 20.1d). Thereafter, proceed in accordance with Sub-Clause 20.6 (Obtaining Dispute Adjudication Board’s Decision). If the NoD is not issued by the party within the set 28 days, the determination of the Engineer’s representative shall be deemed to have been accepted by both parties.

Settlement of Disputes

The parties shall jointly appoint a DAB by the date stated in the contract data. If the parties fail to agree, then an appointment is made by the entity or official named in the contract (Sub-Clause 20.3). Parties may then jointly refer to the DAB to provide assistance to resolve any disagreement (Sub-Clause 20.5).

Subsequently, either party may refer a dispute arising within 28 days to the DAB in writing. Either party may then issue a notice of dissatisfaction within 28 days after receiving the DAB decision (Sub-Clause 20.6). However, both parties shall attempt to settle the dispute amicably before the commencement of the arbitration (Sub-Clause 20.7). After the issue of the NoD, arbitration may not be commenced until 56 days after the notice of dissatisfaction is issued (Sub-Clause 20.8). If the matter cannot be resolved, it is referred to international arbitration for final settlement.

This guest post was written by Mansoor Ali, FICCP. It is the final post in a four-part series and was originally published as a LinkedIn video, viewable here. The previous posts can be found here and here and here.