Construction Law/Claims


I am seeking your advice on the attached matter:
1.   If a contractor fails to remedy defects under Clause 11.4 (a) of FIDIC and the employer writes to the contractor stating such but includes in his letter the following.
“ the cost to remedy and complete the outstanding works detailed in previous letters, in the amount of $216,000.00, this value will deducted from your valuation balance of works and from the overall contract retention.”
2.   There was no Termination Letter stating any Clauses.
3.   The contractor submitted his  claim   twelve (12) months later for works completed inclusive of retention less the works by another contractor ($216,000.00) as per the wording in the correspondence as quote in item 1 above.
4.   The employer rejects claims based upon clause 20.1
5.   The contractor’s failure to complete was based on the fact that the employer had given the contractor additional works (variations) which he had completed but the employer failed to pay because he was tardy in his approval of the costs. He has since approved the cost of the variations, but is still insisting on Clause 20.1
What remedy or contractual clause is there available to the contractor?

You kind assistance would be greatly appreciated.

Thank You.

ANSWER: Dear Ronald,

You do not mention whether or not the request for payment was submitted as a statement of account or a claim under clause 20.1.  If the Contract had not been terminated, merely some defects remedied at the cost of the Employer, it seems to me that the request for payment should have been submitted as either a statement of account under clause 14.3 or as a Statement at Completion under clause 14.10 or an Application for Final Payment under clause 14.11, depending on whether or not the Works have been taken over and whether or not the Final Certificate has been issued.  

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QUESTION: Thank you for your quick response , the request was submitted as an application for final payment, since the works had been taken over. I await your response again I thank you



ANSWER: Dear Ronald,

Getting clients to pay is always a problem.  I guess you have to make a commercial judgement as to whether or not you go to arbitration and the courts or if you write off the loss and move on to more profitable contracts.

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

QUESTION: Good Evening
This Question deals with design and Build Contracts
A contractor is as to bid on a design for a three two story structure which he does.
Upon his getting access to the site it was discovered that based upon the clients brief and the actual site conditions all the rooms that were required could not be accommodated within the two story structures, therefore two of the structures would have to be three story structures.

The question therefore is can the contractor claim for additional design fees and additional costs due to addition works to buildings ie. substructures, framing etc.


Dear Ronald,

Not sure if you are providing two three storey building in place of three two storey buildings, or two three storey buildings and one two storey building.  The difference in cost might be hard to quantify.  If there was no change in the Employer's Requirements, there is no basis for a claim.  However, if the Employer's Requirements were inaccurate or false, then there could be the basis of a claim.  

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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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