Construction Law/Employer's Claim

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Question
We are using Fidic Yellow Book. The Enginner has issued us the Taking-Over Certificate to our project under clause 10.1 and with it he has attached some list of defects/snags.

In these defects/snags there are some items which we are not able to rectify due to the material that we have used is not the same as specified in the Specifications. The Engineer now inform us that since the work has been accepted, he will deduct some value (yet to be determined) from these items as per clause 9.4(c). The clause stated that this has to be done before the Taking-Over Certificate is issued. Now that the Engineer have accepted the works, can we consider that we do not need to reduce the value of these items for the Employer?

Answer
Dear Wong,

Thank you for this question.

If the materials used were not in accordance with the specification and were used without approval, the Contractor has committed a breach of contract and the Employer is entitled to damages in compensation.

In the present case I consider that the Employer's remedy is not under sub-clause 9.4 (c); in my opinion it is under sub-clause 11.4(b), which provides that if the Contractor does not remedy defects the Employer may require the Engineer to agree or determine a reasonable reduction in the Contract Price.

The Employer must make a claim, pursuant to sub-clause 2.5 (Employer's Claims); the Engineer should not just make a deduction.



I hope that this assists you.

Kind regards,
John Dowse

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Construction Law

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John Dowse

Expertise

Legal; contract interpretation; quantum; delay analysis. Practitioner in arbitration, adjudication and mediation.

Experience

Thirty-three (33) years experience in building and construction, at all levels both within contracting and consulting organisations. Practising arbitrator, adjudicator, and mediator. Faculty approved trainer for the Chartered Institute of Arbitrators. Lecturer on construction contract forms and dispute resolution practices.

Organizations
Chartered Institution of Civil Engineering Surveyors Chartered Institute of Arbitrators Institute of Directors Society of Construction Arbitrators

Publications
Various UK and International construction and legal publications.

Education/Credentials
LLB (Hons), Pg Dip (Legal Practice), MCInstCES MCIArb MIOD Barrister

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