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Construction Law/Actual & Correct Quantities

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QUESTION: Hi,

Here in Oman the contract normally used pertains to Actual and Correct Quantities. Contractors always raise the argument that if there is an error in the BoQ (either quantities undermeasured or missing items), they are allowed to claim such items.

Below is the contract clause I am referring to:

(56)Actual and Correct Quantities:
     
Except as provided for under Clause 51 and 58 (1) hereof the quantities as set out in the Bill of Quantities are to be taken as to be the actual and correct quantities of the work to be executed by the Contractor in fulfillment of his obligations under the Contract.  Any error in description or in quantity or omission of item from the Bill of Quantities shall not vitiate the Contract but shall be corrected and deemed to be a variation required by the Engineer.

In the case of the quantities for foundation works being stated to be provisional the Contractor shall, before the surface of any portion of the ground is interfered with or the work is put in hand in conjunction with the Engineer or the Engineer’s Representative examine the Site and the plans and sections of the work and take such additional levels or other measurements as may be necessary and shall agree as to the surface levels etc., with the Engineer.  Such agreement shall be recorded in writing and shall be signed by the Contractor and by the Engineer and shall form the basis of the measurement of the Permanent Works.

From the above clause, are contractors entitled to variations even if items are already in the drawings but missed out in the BoQ?

It would be awesome if you could shed some light on the above.

Thanks for your help.

Bruce

ANSWER: Dear Bruce,

Thanks for your question.

I am trying to answer it but i do not want to assume so as not to err. Since the clause you want me to interpret is related and has a cross-reference and dependence on clauses 51 and 58(1), I would appreciate if you would let me know what clauses 51 and 58(1) says and thereafter, i will be able to advise rightly.

Thank you and kind regards.
Femi

---------- FOLLOW-UP ----------

QUESTION: Hi Femi,

Thanks for responding.

As for the other clairifications, Clause 51 is basically the Variation Clause while Clause 58 is for Provisional Sums.

Here are the contents of the above clauses for you reference.

(51) Variations      
(1)   The Engineer shall make any variation of the form, quality or quantity of the Works or any part thereof that may have been approved by the Employer and he shall have power to order the Contractor to do and the Contractor shall do any of the following: -

a.   Increase or decrease the quantity of any work included in the Contract,
b.   Omit any such work,
c.   Change the character or quality or kind of any such work,
d.   Change the levels, lines position and dimensions of any part of the Works, and
e.   Execute additional work of any kind necessary for the completion of the Works
And no such variation shall in any way vitiate or invalidate the Contract, but the value, if any, of all such variations shall be taken into account in ascertaining the amount of the Contract Price.

Orders for Variations to be in Writing
(2)   No such variations shall be made by the Contractor without an order in writing of the Engineer.  However, as provided for under Clause 55 no order in writing shall be required for an increase or decrease not exceeding five percent in the total quantity of the works where such increase or decrease is not the result of an order given under this Clause, but is the result of the quantities exceeding or being less than those stated in the Bill of Quantities.  Provided also that if for any reason the Engineer shall consider it desirable to give any such order verbally, the Contractor shall comply with such order and any confirmation in writing of such verbal order given by the Engineer, whether before or after the carrying out of the order, shall be deemed to be an order in writing within the meaning of the Clause.  Provided further that if the Contractor shall within seven days confirm in writing to the Engineer and such confirmation shall not be contradicted in writing within fourteen days by the Engineer, it shall be deemed to be an order in writing by the Engineer.


(58) Provisional Sums      
(1)   “Provisional Sum” means a sum included in the Contract and so designated in the Bill of Quantities for the execution of work or the supply of goods, materials, or services, or for contingencies, which sum may be used, in whole or in part, or not at all, at the direction of the Engineer, who shall consult with the Employer prior to the issue of an instruction to this expenditure.  The Contract Price shall include only such sums in respect of the work, supply or services to which such Provisional Sums relate as the Engineer shall approve or determine in accordance with this Clause.

Again, thanks in advance for your help.

Regards,

Bruce

ANSWER: Dear Bruce,

Thanks for prompt response. Let me answer your question point blank. According to the clause 56 cited by you, yes, the Contractor would have a contractual right to claim for any additional cost implication of any omission or error in the quantities of works stated in the BOQ. This is because, the clause has already placed the risk of such error and or omission upon the employer and the Contractor is not responsible to verify the accuracy of, and satisfy himself with the correctness of the quantities in the BOQ whether it tallies with those that are required for the amount of the works to be done. Remember that, the correct amount of works to be done are correctly as indicated in the contract drawings and or specification for the works which are measured in line with the contract indicated method of measurement.

On the other hand and except it is otherwise stated in the contract, if such omission, error in description and or quantities in the BOQ, translates to have negative cost implication (as variation), it shall be corrected as such.

The summary of the clause could be said to mean that, the contract is a "remeasured contract".

Hope this clears your doubt?

Femi

---------- FOLLOW-UP ----------

QUESTION: Dear Femi,

When I first read this clause, that was what I had in mind as well, that it was remeasurable.  But then again, in the Oman Standard Conditions of Contract Clauses pertaining to "Quantities", there are two Clauses.  The Clause 56 as I mentioned was the "Actual and Correct Quantities" and the other one which I forgot to mention, Clause 55 is for "Estimated Quantities".

Below is the clause for your reference:

(55) Estimated Quantities      
(1)   The quantities set out in the Bill of Quantities are the estimated quantities of the work, but they are not to be taken as the actual and correct quantities of the Works to be executed by the Contractor in fulfillment of his obligations under the Contract.  The quantities may vary conforming to the actual site conditions, due to errors or omissions in the original Bill of Quantities, and on account of variations.  Such errors in, omissions from, or variation to the Bill of Quantities shall not in any way vitiate or invalidate the Contract, nor shall the Contractor be entitled to any claim whatsoever except as provided in Clauses 51 and 52 hereof.

Works to be Measured
(2)   The Engineer shall, except as otherwise stated, ascertain and determine by measurement the value in terms of the Contract of work done in accordance with the Contract.  He shall, when he requires any parts or parts of the Works to be measured, give notice to the Contractor’s authorized agent or representative, who shall forthwith attend or send a qualified agent to assist the Engineer or the Engineer’s Representative in making such measurement, and shall furnish all particulars required by either of them.  Should the Contractor not attend, or neglect or omit to send such agent, then the measurement made by the Engineer or approved by him shall be taken to be the correct measurement of the work.  For the purpose of measuring such permanent work as is to be measured by records and drawings, the Engineer’s Representative shall prepare records and drawings month by month of such work and the Contractor, as and when called upon to do so in writing, shall, within fourteen days, attend to examine and agree such records and drawings with the Engineer’s Representative and shall sign the same when so agreed.  If the Contractor does not so attend to examine and agree such records and drawings, they shall be taken to be correct.  If, after examination of such records and drawings, the Contractor does not agree the same or does not sign the same as agreed, they shall nevertheless be taken to be correct, unless the Contractor shall, within fourteen days of such examination, lodge with the Engineer’s Representative, for decision by the Engineer, notice in writing of the respects in which such records and drawings are claimed by him to be incorrect and the decision of the Engineer shall be conclusive, final and binding.

In the case of foundation works, or where the Engineer considers it necessary, the Contractor shall, before the surface of any portion of the ground is interfered with or the work is put in hand, in conjunction with the Engineer or the Engineer’s Representative, examine the Site and the plans and sections of the work and take such additional levels or other measurements as may be necessary and shall agree as to the surface levels etc., with the Engineer.  Such agreement shall be recorded in writing and shall be signed by the Contractor and by the Engineer and shall form the basis of the measurement of the Permanent Works.

So as you can see, this is the reason of my confusion regarding these Standard Conditions.  I am aware that it is not a Fixed Lump Sum Contract.  And if I use this Clause 55, it will pertain to a remeasurement contract.  What I am confused about is if Clause 56 is used, does that mean it also acts as a remeasurement contract?  Why have two different clauses which would end up being the same?

For my final question, are Actual and Correct Quantity Contracts supposed to be Remeasurement Contracts and not Fixed Lump Sum Contracts?  I remember to have read you answering this question saying it is more likely to follow suit with a Lump Sum Contract.  But with regards to the above two clauses, I am in total disarray.

It would be awesome if you could help me shed some light on the above.

Thanks for all the help.

Bruce

Answer
Dear Bruce,

Thanks again.
Yes, i recalled in one of my answers that, i explained LUMP SUM contract based on Clause that resemble the one you cited in your clause 56 but really not because the clauses (the clause 56 and the Clause which i interpreted as LUMP sum are not same, they are worded differently).

For example, these below 1 & 2 mean the same thing under a contract:
1. When the clause says "quantities are to be taken as actual and correct..... and any omission or and error in quantities in BOQ will be corrected and treated as VARIATION to the CONTRACT". It means the RISK of any "incorrect or omitted quantities and or of work is upon the CLIENT / EMPLOYER and the Contractor will be paid for such error and incorrect quantities as a VARIATION". This is a REMEASURED Contract.

2. When the clause says - like you clause (56)Actual and Correct Quantities:
"Except as provided for under Clause 51 and 58 (1) hereof the quantities as set out in the Bill of Quantities are to be taken as to be the actual and correct quantities of the work to be executed by the Contractor in fulfillment of his obligations under the Contract.  Any error in description or in quantity or omission of item from the Bill of Quantities shall not vitiate the Contract but shall be corrected and deemed to be a variation required by the Engineer. It means the RISK of any "incorrect or omitted quantities and or of work is upon the CLIENT / EMPLOYER and the Contractor will be paid for such error and incorrect quantities as a VARIATION". This is a REMEASURED Contract.

and unlike the above two clauses, these below 3 & 4 mean the same thing as well under a contract:
3. When the clause says "quantities are to be taken as actual and correct..... and any omission or and error in quantities in BOQ will NOT be corrected NEITHER WOULD BE A GROUND FOR VARIATION to CONTRACT". It means the RISK of any "incorrect or omitted quantities and or of work is upon the CONTRACTOR to verify and be sure before entering into to the Contract". This is a LUMP SUM FIXED QUANTITIES CONTRACT.

4. The clause (55) Estimated Quantities which you cited:
"The quantities set out in the Bill of Quantities are the estimated quantities of the work, but they are not to be taken as the actual and correct quantities of the Works to be executed by the Contractor in fulfillment of his obligations under the Contract.  The quantities may vary conforming to the actual site conditions, due to errors or omissions in the original Bill of Quantities, and on account of variations.  Such errors in, omissions from, or variation to the Bill of Quantities shall not in any way vitiate or invalidate the Contract, nor shall the Contractor be entitled to any claim whatsoever except as provided in Clauses 51 and 52 hereof. It means the RISK of any "incorrect or omitted quantities and or of work is upon the CONTRACTOR to verify and be sure before entering into to the Contract". This is a LUMP SUM FIXED QUANTITIES CONTRACT.

I hope the above clears your doubt?

Thanks and kind regards.

Femi

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Femi Alofe

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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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