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Construction Law/Value of Contract & Value of Works

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Question
Dear Engr. Arshad Mehmood
Thanks for the volunteer services being shared by your expertise;

I have one question: In the Lumpsum type of Contract some works are covered under direct execution by the Contractor however the execution of other works e.g. Design of the Project and supply and installation of Medical equipment, etc.etc. are being arranged by the Employer through their nominated contractors however their payment is deducted through the Main Contractor's IPC  by including their work done as per execution. My specific question is either all will be covered under the definition of works or the only direct part under execution by the Main Contractor will form "Works". Because the "Value of Contract" represents the total cost however  some part of that cost is just paid to the design firm or other Contractor/supplier with no profit and no loss basis.

Looking forward, best regards

Answer
Dear Sheraz,

Generally, in Lumpsum Contracts,there should be no work to be executed by the Employer through his nominated contractor.In the Contracts, where some works are required to be executed through nominated contractor,the main Contractor receives  a reasonable %age on the  net certified  amount of works executed by the nominated sub-contractor.Perhaps this is not the case in your Contract.

Now coming to your  specific question, in my opinion all the works will be included in the scope of Work of the main Contractor and the works pertaining to design or others can not be treated as separate works but are the parts of the Works of the main Contractor as per TOR of your Contract.
Any further clarification will be always well come, if required, in this regard.

Regards
Engr. Arshad Mahmood

Construction Law

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Arshad Mahmood

Expertise

I may answer to the questions relating to FIDIC 4th as well as FIDIC 2010 MDB Harmonized version,price adjustment ,Variations,Eot and Cost claims,EPC Contract,Bidding Document,consultancy Contracts,certification,Standard Forms, Dispute resolution; and others pertaining to Contract implementation.

Experience

Contract management and Contract Administration, using FIDIC Conditions of 4th Addition as well as Fidic 1999 Red, Yellow and Silver Books including MDB Harmonized Edition 2010. Particularly in the area of Procurement of Contracts, Certification,Price Adjustment, variations,disputes management, EoT and Cost Claims; and other contractual issues arises from time to time during currecy of the Contracts.

Organizations
Member -Pakistan Engineering Council Member -Pakistan Engineering Congress Member -FIDIC Organisation

Publications
Joint Venture and Consortium Agreements for Pakistan Engineering Council,Pakistan

Education/Credentials
BSc Civil Engineering; Basic Management course; Hydro power Projects; and various other on Job Trainings

Awards and Honors
Commendation Certificate for the excellent management qualities and dedication at Ghazi Barotha Hydropower Project; and Certificate of Excellent work performed during Survey Camp.

Past/Present Clients
Water and Power Development Authority (WAPDA),Associate Consulting Engineer(ACE) and National Engineering services Pakistan(Pvt.) Limited (NESPAK)

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