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Question
Repayment of the advance under Clause 14.2
In certificate nr 7 the Contractor's interim payments have reached 10% of the Accepted Contract Amount and repayment of the advance will commence.  The Contractor has calculated the repayment amount as 15% (PC) of the value of IPC nr 7 (the net certificate value).  The Engineer, however, calculated as 15% of the value of Certificates 2-7 inclusive (the cumulative certificate value; NB: IPC nr 1 was the advance)  stating that deductions shall be made at the rate stated of the amount of EACH Interim Payment Certificate (excluding )

Who is right, the Contractor or the Employer?

Answer
Dear Slobodan,

Thank you for your question.

I will like to let you know that the Engineer is correct. Deduction of advance payment recovery is calculated based on cumulative valuation. In your circumstance,  what I guess you are referring to is the moratorium period which in some cases could be agreed to allow the Contractor to work and earn sufficient sums on work done prior to amortization of the advance payment.  This is a gesture to aid a good cash flow for the Contractor.

I do hope this clarifies your doubts.

Thanks.
Femi

Construction Law

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Femi Alofe

Expertise

I can answer all questions relating to the followings: 1. Contract Administration - variations, contract clauses interpretation, all post contract procedures, valuations and certificates questions, extension of time issues and prolongation cost matters. 2. Contract Practice - Any questions regarding forms of contract like JCT, FIDIC & other Bespoke forms. 3. Quantification, measurements and Estimating questions 4. Contracts and construction law questions and dispute resolutions problems. 5. All FIDIC Conditions of contracts

Experience

Out of my 24 years experience in construction industry, i have the following specific experience: 1. Contract Administration - 15 years in contract administration with over 10yrs in Managerial positions covering africa and the middleeast. 2. Contract Practice - 15 years experience with over 10yrs in Managerial and expert positions covering africa, north america and the middleeast. 3. All pre-contract procedures, Tendering, Quantification, measurements and Estimating questions - 20 years experience. 4. Contracts and construction law questions and dispute resolutions problems - 15 years experience with over 10yrs in Managerial and expert positions and 5 years expert witness and active practice in arbitration proceedings covering africa and the middleeast.

Organizations
1. FAIQS - Fellow, Australian Institute of Quantity Surveyors, Australia 2. FRICS - Fellow, Royal Institution of Chartered Surveyors, UK 3. CCP - Certified Cost Professional AACEI, USA 4. PQS - CIQS, CANADA 5. ACIArb. - CIArb, UK 6. MNIQS - NIQS, NIGERIA 7. RQS - QSRBN, NIGERIA

Publications
1. AACEI RP on Estimating, 2010

Education/Credentials
1. B.Tech (QS) 2. RICS professional course, CEM - UK 3. MSc , UK NARIC 4. Professional Doctorate ( to commence 2016)

Past/Present Clients
1. Larsen & Toubro Ltd, Dubai UAE 2. Larsen & Toubro (oman) LLC 3. Archi + Web consortium, Abuja Nigeria 4. George Dike & Associates, Minna Nigeria 5. Public works Authority (Ashghal), Doha Qatar

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