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Construction Law/Extension of time-price escalation


Dear Sir,

A prolonged suspension had taken place during which time a clear direction was not issued from the Engineer.

Further, it is also a known fact that the contract period for the subject project had lapsed at the time an instruction to recommence/resume was received.

1.   Does this bring change in the execution of the contract? By the way, the contract is FIDIC 1987, 4TH EDITION.

2   The Contract has price escalation provision.

2.1   Would there be any additional costs that would be incurred due to the time element to the tune of the amount not covered with the basic materials price escalations.

2.2   Can the Contractor request for revision rates for the execution of the remaining works, stating that the contract only allows for recovery of basic material escalations only? If so, what factors have to be considered when making rate revisions?

3.   Can the contractor claim additional payment stating that on instruction to resume/recommence; additional resources had to be mobilized to the site to carry out the remaining works.

4.   How can the delay caused be analyzed to determine extension of time?

I am deeply indebted in advance.


Hi Alemu
Simple answer to q 1 2 & 3 is yes - these are all valid claim heads.
Don't forget currency exchange rates and loss of head office overhead recovery using Hudson or Emden's formula.

Q4 is also simple.

If the suspension was at the begining of the work just shift the start milestone.
If it was in the middle of the work just put non working days on the calendar to represent the period of suspension.

Best regards
Mike Testro

Construction Law

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Mike Testro


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45 years in the Construction Industry 15 Years as a consultant delay analyst - I now hold myself to be expert in this field.

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Currently employed in India by Punj Lloyd as expert delay analyst. Engaged in ongoing arbitrations and EoT claims. Prior an Indepenent consultant in delay analysis.

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