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Construction Law/Idle Plant FIDIC 1998


We mobilized specialized machinery to site to carry out works in advance due to the size and set up times. Part of the works necessitating the specialist machinery was omitted via issue of a revised drawing rendering the equipment idle.
We have provided daily record sheets and nominal costing for consideration.
The consultant is requesting that we submit evidence of actual costs. How can we provide this actual cost if the machinery is owned by us?

Dear Steven,

A fairly common problem.  You can try a couple of approaches, local hire rates for similar equipment or a depreciation calculation with static running costs (operator(s) and support costs).  It depends on which the engineer will accept.  Depreciation is a common accounting procedure, but beware of using a depreciation method which is valid for tax purposes only.  Most manufacturers will give you an estimate of expected life and residual value.  If the equipment was not used at all, then you could include mobilisation and demobilisation, or at least a part of them.  

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Peter M. Elliott


First response to queries regarding extensions of time, variations orders, site instructions and payment using FIDIC and other forms of Conditions of Contract, based on English Law, and derivatives only. Anyone who needs advice about EoT should download and study the SCL Delay & Disruption Protocol before submitting a question.


Value . . .
It's unwise to pay too much, but it's unwise to pay too little. When you pay too much you lose a little money, that is all. When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing you bought it to do.
The common law of business balance prohibits paying a little and getting a lot. It can't be done. If you deal with the lowest bidder, it's well to add something for the risk you run.
And if you do that, you will have enough to pay for something better.
. . . John Ruskin (1819 - 1900)
"We are too poor to buy something cheap"
.Romanian Proverb 2002
A lean compromise is better than a fat lawsuit. George Herbert (English poet 1593-1633)
I said it in Hebrew, I said it in Dutch,
I said it in German and Greek:
But I wholly forgot (and it vexes me much)
That English is what you speak!" Hunting of the Snark - Lewis Caroll
Match your presentation to the reader!
The joy of food lasts but an hour, of sleep but a day, of a woman, but a month, but the joy of a building lasts a lifetime. Syrian proverb.
Comments and observations leading to improvements in the translation of FIDIC Red & Yellow books into Romanian prior to approval by FIDIC (reference 'Preface to the Romanian edition')

Institution of Civil Engineers, Association of Chartered and Certified Accountants, Society of Construction Law, Dispute Resolution Board Foundation

B Sc(Hons) in Civil Engineering

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