Construction Law/site possession


we are in a project with fidic red 99, duration is 36 month while for one phase we have milestone of 18 month, we did not get site possession fully for the phase of 18 month while we got it for the other areas... the contract amended fidic 99 red clause for the base date and changed it to. base date is the site possession and amended clause 2.1 by adding the sentance the employer may withhold any such right or possession until theperformance security has been received taking in consideration that we did not submit the performance security yet and the official contract not yet signed only letter of acceptance is there and the employer start counting the duration from site possession mid of dec 2012 ..can we submit to the engineer notice to claim as a result of failure to get the site possession of 18 month milestone phase and to ask for EoT and cost and reasonable profite ....kindly note that even still contract not yet signed but we submitted lot of notices and the programme not yet approved due to the engineer comments to submit it resource loaded and cost loaded while in the contract it is not really required only we have to submit a list of equibments and resources>>now the engineer stated that we have site possession based on partial area we really got....kindly advise

Dear amr,

There are several points to note in this rather convoluted situation.  Nobody seems to have done a good job.  

Why start a project when the Contract has not been signed.  You lose all bargaining power, but that is in the past and, perhaps, a lesson for the future.  If you have no signed contract, the courts will have to decide whether or not a contract existed and what was the intention of the parties.  Not easy, especially in a country where there is a civil code and Sharia law.  Get a signed contract or walk away.  Your losses will be smaller.  

Without more information, I would say that you had to provide a performance security; you did not do so, so the Employer was not obliged to give you access to the site; so you are responsible for any delays.  Submit the performance security now or walk away.  

It would appear that the 36 month duration applies but the 18 month milestone has not started through your failure to issue a performance security, but it could be argued otherwise.

FIDIC 99 clause 8 does not require the Engineer to approve the Contractor's programme, merely to state where it does not comply with the Contract.  Thus his requirements are irrelevant unless they are stated in the Contract.  Also, you have no Contract, so you have no obligation to submit a programme, nor a cashflow.  However, it is good management practice to produce a programme which is resource loaded and a cashflow to ensure that you have adequate resources when needed.  

This is a rather confused situation and I suggest that you get detailed advice on how to proceed.

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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.


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