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Construction Law/Variation under FIDIC 1987

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Question
Dear Mr. Peter,

For instance, we issued the Tender Documents including the BOQ with quantities based on the Tender drawings. Lets consider the underground water tank.

The Tenderer has changed the quantities (they increased) and has established their total Tender amount. The Contract was awarded to this Tenderer.

The Client has decided to increase the capacity of this under ground water tank for future purposes thus making is extend more than 3 meters off the ground and some other modifications.

Now the question is as follows:

As an Engineer, even though the Contract is lump sum, can we evaluate this variation as omission and addition?

Whereas we will omit the quantities (they increased) changed by the Contractor during Tender stage and multiplied by the rates they stipulated in the Contract BOQ,

and add the new quantities based on the revised construction drawings multiplied by the same rate as stipulated in the Contract BOQ.

Answer
Hi Jeffrey,

A lump sum contract and BoQ's is an oxymoron, unless the purpose of the BoQ is defined very clearly.  Obviously some one had no idea of what they were doing when they prepared the tender documents.  So the Contractor adjusted the quantities - another potential problem. Yes you can evaluate the revised capacity of the tank as a variation.  Who is responsible for the design?  Will the walls and base slab need thickening or strengthening because of the increased depth of water?  Will the foundations need to be adapted for the increased load?  A 3m increase in depth is no small matter.

It is does not matter how you adjust the Contract Price as long as the Contractor agrees.  I suggest that you ask the Contractor to price the variation before you instruct it.  Then you can decide whether or not it is cost effective to use him or to let a separate contract.  

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Peter M. Elliott

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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 www.eotprotocol.com before submitting a question.

Experience

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')

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

Education/Credentials
B Sc(Hons) in Civil Engineering

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