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Construction Law/Associated Costs to EOT


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QUESTION: Dear Sir/Madam
Our Contract is bespoke for a petroleum project. The clause of Delays & Extension of Time allows EOT may be granted to the Contractor in case of delays attributable to the Employer + additional payment. Another clause of Standby, allows to pay standby costs for each labor and equipment gets Standby due to the reasons attributable to the Company under a given schedule of time rate. My questions are:
1- can this additional payment be deemed as the Standby costs in case these Standby costs have been already granted to the Contractor?
2- Or Additional payment is something else?
3- what are the basis on which this additional payment calculated? and are these Standby costs are included in it?

I need your inputs very urgent please .. I am attaching the 2 clauses  if you like to have a look for better and detailed answer.

Thank you so much in advance.

ANSWER: Dear Khalid,

Thank you for your question.

Yes, EOT would normally be granted to Contractor for delay events caused / attributable to the Employer and it will also be granted with prolongation cost. I guess that this prolongation cost is the cost you are referring to here as the additional payment. However, whether, it is or not, any Contractor compensable EOT will normally entitles the Contractor to prolongation costs. This prolongation cost is entirely different from the IDLING COST / CHARGES. Going through the content of the conditions you attached to your question, i can let you know that, it only refers to idling costs of labour and equipment which is completely different from prolongation cost which is required to administer the projects in terms of site / project maintenance and running site preliminaries and general items which are needed to be expended for a smooth day to day running of the site whether work is performed or not. These are items like scaffolding, fencing, watching and lighting, water for works, site telephone and electricity bills...etc.

I hope this is clear?



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

QUESTION: Dear Mr. Femi

Thank you for your wonderful explanation. However, I still have a new question related to this subject. What if the Contract doesn't allow for such Standby/Idle clause? as far as I know, FIDIC doesn't do. In this case, how can the Contractor claim for such Standby resources?. And regarding the prolongation costs that associated to the approved EOT, when and what is the proper time to negotiate and approve it to the Contractor, during and upon the approval of the EOT or later on right prior to the end of original project duration i.e.start of the prolongation??

Thank you so are really great


Thank you Khalid for your follow up question.

1. The Contractor can apply for the prolongation cost after the approval or the granting of the EoT. This is because, the prolongation can be based on the approved EOT. There may be a situation where there are disputes regarding the quantum of the EOT granted and this should not deprive the contractor from applying for the cost which he considers himself entitled. Anyway, anytime, the contractor can submit and apply to be compensated for his cost either submitting it along with the EoT claim or thereafter.
2. If the clause is not included in the contract for the reimbursement of the idle cost, then, for any contractor to be entitled to be compensated for any loss whatsoever whether as a result of idling costs incurred due to employers fault or any other losses caused by the employer, there must be a basis which is either derived from the contract (when not expressly stated) or derived from the law of the land. Most countries have laws that govern  commercial transactions and contract relationships which usually provides for grounds for this kind of claim. It is only left for a diligent contract and claim professional to dig it out. In Fidic, which you cited, the provision is included.


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Femi Alofe


I can answer all questions relating to the followings: 1. Contract Administration - variations, contract clauses interpretation, all post contract procedures, valuations and certificates questions, extension of time issues and prolongation cost matters. 2. Contract Practice - Any questions regarding forms of contract like JCT, FIDIC & other Bespoke forms. 3. Quantification, measurements and Estimating questions 4. Contracts and construction law questions and dispute resolutions problems. 5. All FIDIC Conditions of contracts


Out of my 24 years experience in construction industry, i have the following specific experience: 1. Contract Administration - 15 years in contract administration with over 10yrs in Managerial positions covering africa and the middleeast. 2. Contract Practice - 15 years experience with over 10yrs in Managerial and expert positions covering africa, north america and the middleeast. 3. All pre-contract procedures, Tendering, Quantification, measurements and Estimating questions - 20 years experience. 4. Contracts and construction law questions and dispute resolutions problems - 15 years experience with over 10yrs in Managerial and expert positions and 5 years expert witness and active practice in arbitration proceedings covering africa and the middleeast.

1. FAIQS - Fellow, Australian Institute of Quantity Surveyors, Australia 2. FRICS - Fellow, Royal Institution of Chartered Surveyors, UK 3. CCP - Certified Cost Professional AACEI, USA 4. PQS - CIQS, CANADA 5. ACIArb. - CIArb, UK 6. MNIQS - NIQS, NIGERIA 7. RQS - QSRBN, NIGERIA

1. AACEI RP on Estimating, 2010

1. B.Tech (QS) 2. RICS professional course, CEM - UK 3. MSc , UK NARIC 4. Professional Doctorate ( to commence 2016)

Past/Present Clients
1. Larsen & Toubro Ltd, Dubai UAE 2. Larsen & Toubro (oman) LLC 3. Archi + Web consortium, Abuja Nigeria 4. George Dike & Associates, Minna Nigeria 5. Public works Authority (Ashghal), Doha Qatar

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