Expert: Senthil Kumar Sellamuthu - 1/17/2012

Question
QUESTION: Dear Senthil

Under fidic 1999, for a fixed priced lump sum contract, What if the Contractor put notation on all the BOQ items under Furnishing bill “Included in PS”..(Except for the mirrors which was priced)..

Is the contractor entitled to provisional sum adjustment for all the Furnishings, including fixed Furnishings (which has details in the contract drawings) since it was noted in the BOQ that the contractor had priced these items under Provisional Sum.

In addition, The notation on the bills might be the cause of misinterpretation on one of the Answers to Query, but then, the contract was finalised with all parties signed on those pages.

I just want to make sure that it was not deemed to be included/priced in the contract amount and not to be adjusted like a Provisional sum.

Thanks in Advance.

ANSWER: Dear Mr. Jaime,

Thanks for your Questions. I think your understanding is not correct.

"Under fidic 1999, for a fixed priced lump sum contract, What if the Contractor put notation on all the BOQ items under Furnishing bill "included in PS" (Except for the mirrors which was priced).." - That means the BOQ Items are consider under the Provisional sums items only, Not in other items.

Where ever the Items are included in the PS items (Except) only to adjusted and all other items are priced under the fixed lumpsum contract basis.

Thanks and regards,

Senthil Kumar

---------- FOLLOW-UP ----------

QUESTION: Dear Senthil,

Thanks for the answer, I just would like to add something to the info I provided earlier.

"Furnishing" bills in the BOQ supposed to be priced individually, per furniture, but the Contractor put bracket on each page (literally by pen) and put "Included in PS" notation.  Client, Contractor & Engineer all signed on this documents complete with stamp.

There is no reference addendum or instruction during tender stage to put them under provisional sum.

There was a separate Item on the bills for Provisional sum which is entitled "furnitures, Fittings and Equipment".

Now, Client's opinion that furnishings listed under "Furnishing" bills on the BOQ was deemed to be priced and not to be adjusted under the Provisional Sum, since they have not instructed the Contractor to put it on the provisional sum during tender stage.

Contractor, of course, claim for the amount of the Furnishings as installed.

Is it right to take the contractor side as the correct one?

Answer
Dear Mr. Jaime,

In that above case, the contractor can not get as a provisional Items for "Furnishing Items".

The Signed BOQ is the Guideline for making monthly invoices and that is not a valid Contracts documents. If, there is no reference or conditions or addendum's means you should treat as a BOQ Items of other than PS Items.

Clause 14.1 - The Contract Price - (d) the Contractor shall submit to the Engineer, within 28 days after the Commencement Date, a proposed breakdown of each lump sum price in the Schedules. The Engineer may take account of the breakdown when preparing Payment Certificates, but shall not be bound by it. So, Just check with the contractor price breakdown (if available) and get the conclusion.

Thanks and regards,

Senthil Kumar