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Construction Law/Valuation of Variations under LS Contracts


Dear Sir,

This relates to a lump sum contract (Modified FIDIC Red Book 99) for a residential project under the applicable laws of Jordan. The contract includes a Provisional Sum for certain expected variation at the time of entering into contract to a couple of buildings. At the time of entering into contract, it was not expected that this variation will comprise a structural re-design, it was expected to be all about architectural changes. The contract BOQ shows a quantity of steel reinforcement less than the contract drawings by 400 tons. This was known before entering into contract but not considered an issue since it is a lump sum contract. The new structural design (different cores, staircases, columns etc.) shows the same quantity of steel reinforcement of the original design under the contract, however the contract is claiming the additional 400 tons on the basis that that particular conditions include a provision specifically stating that if any variation involves an omission that creates a saving (a condition precedent which probably implies that not all omissions could create a saving) such saving will be calculated on the basis of the rates set out in the BOQ. The contractor is claiming also that the employer cannot exceed the total allowance made under the BOQ when calculating the saving from omitting the elements of the work comprising the original design. The rates of the BOQ are fixed for any variations, the contractor contractually takes the responsibility of the quantities under the BOQ, no sundry items were added under the BOQ and the contract is a standalone document and supersedes tender negotiations.
Is the contractor entitled for the 400 tons or he is not entitled at all for the same since there is no difference in quantities between the original and varied designs. From a variation procedure perspective and valuation of this variation, should the employer omit the original design (and calculate the saving as aforementioned) and then add the new design (and calculate the extra cost) or the employer should claim that this is a substitution without extra cost. I am confused about the term “substitution” under the definition of the term “variation” under the contract as it could be escape from calculating the omission and then the addition as per the terms of the contract.
I am from the employer side and very keen to be fair. I hope I am clear in my enquiry and thanks in advance for your time in clearing my confusion.


Dear Wael,

The idiots who include a BoQ in a lump sum project should be made to implement the project and sort out the various problems.  Did the Contractor actually know that the rebar was undermeasured?  Not that it makes a lot of difference.  

The theory is that the Contractor adjusted his rates to cover the actual quantities shown on the drawings.  So, if the quantities were under measured, he would have increased his rates to allow for the under measure, making the total for that item relevant to the actual quantity.  If there is no difference in the quantities, then I would not pay the Contractor extra.  However, he may have a claim for delay and disruption due to change.  If future, I suggest that you agree the cost and time effect for such a major change before issuing the amended drawings.  

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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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