Construction Law/Counterclaims

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Question
We have a back - to- back subcontract agreement with our Main Contractor based on 1999 Fidic (Red Book). There is no penalty clause in the subcontract. At the end of the 2 year contract, the Main Contractor rejects our final payment certificate and instead provides an unsubstantiated counterclaim and avoids paying us. According to FIDIC 1999, our question is:
1. what conditions is the Main Contractor supposed to meet for his counterclaim against the subcontractor to be valid ?
thank you.

Answer
Dear Jackie,


If your subcontracting agreement is based on 1999 Fidic (Red Book, just read the Conditions of Contract by understanding that your Main Contractor is actually "the Employer" and you are the Contractor.

Please read Sub-Clause 2.5 [Employer's Claims] and there should be your answer.

In terms of specific conditions, there is none, but there should be a reasoning, their claims should quote a certain Sub-Clause that you have failed to observe, hence they must demonstrate a breach of Contract.

They must demonstrate their claim has a merit first, and secondly, the quantum. They can not just ask for no matter what amount, just like that.

Trust that answer your query.

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Florin NICULESCU

Expertise

Questions related to Civil Engineering Contracts, using FIDIC or other Conditions of Contract, concerning Procurement procedures and documents (pre-qualification, tendering and contracting) and Services/ Works Contracts implementation matters including Determinations, Payments, Time Extensions, VOs, Claims/Disputes. Additionally, questions related to dealing with International Financing Institutions. Can also answer questions in Romanian. Can not answer improperly formulated questions.

Experience

Over 20 years of experience in the field of design, works supervision, construction, management of aid funds and technical assistance for various types of contracts implementation, including severe conflictual contractual situations leading to Claims and disputes. Claims/ Contract management, Disputes adjudication, Arbitration.

Organizations
Member of Romanian Professional Association of Roads and Bridges; Listed on President's List of Adjudicators of Romanian Association of Consulting Engineers www.aric.org Former member of the Disputes Resolution Board Foundation (DRBF) of United States – nominee on DRBF President’s Disputes Board Members List www.drb.org and of DRBF Chapter for Eastern Europe http://dabdrb.googlepages.com Former member of Polish Association of Consulting Engineers (SIDiR) – nominee on SIDiR President’s Disputes Board Members National List http://www.sidir.pl/sidir/index.php?action=czlonkowie&a2=r Member of “AllExperts.com” volunteers pool http://www.allexperts.com/user.cgi?m=4&expID=85358&catID=914 Member of the "Constructions Disputes Resolution Services” International Panel of Construction ADR Specialists" of United States www.constructiondisputes-cdrs.com

Education/Credentials
- Graduate in 1994 the Construction Institute - Graduate of several FIDIC,Procurement and other courses - Graduate of first Disputes Board Members Mentoring Scheme (http://www1.fidic.org/resources/adjudicators/pupilage.html) - FIDIC Accredited Adjudicator

Past/Present Clients
- Several State organisations/Ministries , such as Ministry of Transport, National Admistration of Roads, Ministry of Regional Development (former Ministry of European Integration), Public Works and Housing, Central Contracting and Financing Unit in Romania and also in Turkey, Croatia and Macedonia - Numerous Western based private consultancy companies - full CV and other relevant information available at www.abinitio.ro

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