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Construction Law/Insurance under FIDIC 1999-Red Book


As per the Contract, payment of a Lump Sum item of work shall become due after its 100% completion.
The work was almost complete (not 100% complete and its payment has not become due under the Contract).
The loss/ damage(50%) occurs to the work due to a Risk (which has been insured as Per Clause 18.2).
However, the Engineer does not require to rectify the lost work due to any reason.
Who shall bear the cost of execution (including the Contractor's Profit for the executed works) of the lost work in case the risk is:
i)Employer's Risk (insured)?
ii)Contractor's Risk (insured)?

Shall the Engineer's requirement not to rectify the lost work constitute omission?


Dear Usman,

This questions sounds a little hypothetical, rather than a real situation.  

The work has been done and must be paid for.  It could be dealt with as an omission, but payment must be made for the work done.  
i) if an Employer's risk then any costs are recovered under the Employer's policy.
ii) If a Contractor risk, then any costs are recovered under the Contractor's policy.  

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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 . . .
It's unwise to pay too much, but it's unwise to pay too little. When you pay too much you lose a little money, that is all. When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing you bought it to do.
The common law of business balance prohibits paying a little and getting a lot. It can't be done. If you deal with the lowest bidder, it's well to add something for the risk you run.
And if you do that, you will have enough to pay for something better.
. . . John Ruskin (1819 - 1900)
"We are too poor to buy something cheap"
.Romanian Proverb 2002
A lean compromise is better than a fat lawsuit. George Herbert (English poet 1593-1633)
I said it in Hebrew, I said it in Dutch,
I said it in German and Greek:
But I wholly forgot (and it vexes me much)
That English is what you speak!" Hunting of the Snark - Lewis Caroll
Match your presentation to the reader!
The joy of food lasts but an hour, of sleep but a day, of a woman, but a month, but the joy of a building lasts a lifetime. Syrian proverb.
Comments and observations leading to improvements in the translation of FIDIC Red & Yellow books into Romanian prior to approval by FIDIC (reference 'Preface to the Romanian edition')

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

B Sc(Hons) in Civil Engineering

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