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Construction Law/Final Payment Certificate



In our project, FIDC MDB 2006 edition is being used. The Contractor has failed to submit Statement at Completion (Sub-Clause 14.10) even after the due date of 84 days after TOC. Sub-Clause 14.14 states,
”The Employer shall not be liable to the Contractor for any matter or thing under or in connection with the Contract or execution of the Works, except to the extent that the Contractor shall have included an amount expressly for it:
(a) in the Final Statement and also
(b) (except for matters or things arising after the issue of the Taking-Over Certificate for the Works) in   the Statement at completion described in Sub-Clause 14.10 [Statement at Completion].
However, this Sub-Clause shall not limit the Employer’s liability under his indemnification obligations, or the Employer’s liability in any case of fraud, deliberate default or reckless misconduct by the Employer.”

I have following two questions;
(1)   How this failure will effect Contractor’s Entitlements?
(2)   Is this necessary for the amount (due to matters arising before TOC) which Contractor wishes to include in Final Statement after this failure, must also be expressly stated in Statement at Completion? Because Sub-Clause 14.14 (a) states the word “in the Final Statement and also”

Your expert opinion is requested.



ANSWER: Dear Umer,

1.  I suggest that it will have little effect on the Contractor's entitlement.  The intention is early resolution of any outstanding matters.  Delay in submission means delay in payment, which hurts the Contractor more than the Employer.

2. Again I suggest that the delay will have little effect.  

I suggest that you talk to the contractor informally to identify any reasons for the delay.  Perhaps he is short staffed.  Also I would prepare my own estimate of any claims and submit it to him informally to gauge his reaction.  

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Thanks for the reply.

I also would like to ask that if the Performance Certificate has been issued by the Engineer and the Contractor submit his draft Final Application without submitting his Statement at Completion, then the answer will be the same or the Employer cease to be liable for the amounts (occurring before TOC)?

Dear Umer,

Unlike clause 20.1, I see nothing to suggest that clause 14.10 is a condition precedent or time bar to settlement of clause 14.14.  However, the later the submission, the more difficult it is to find the proper documents and to resolve any differences in a timely manner.  

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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.


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

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