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Construction Law/Commencement of Work

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Question
Dear Alina,

GCC: FIDIC MDB June 2010

Question:

Though the above GCC is not within your expertise, I suppose you will be able to clarify me, since this GCC has been prepared with minor adjustments of FIDIC 1999 and your available expertise is adequate to advise me.
*The letter of Acceptance has been issued to the Contractor nearly three months back, but other arrangements has not been made so far as per cl.8.1 including Signing Contract Agreement, Site Possession and issuing Notice to Commence Work,due to some problem for which the Contractor is not responsible.

*The Contractor has promptly provided the Performance Bond.

*He has received the Advance Payment.

*Meanwhile as per the "General Requirements", the Programme of Works is to be prepared commencing from the date of acceptance of Bid, which is contrary to cl. 8.1, according to which the programme is to be submitted only within 28 days after the receipt of notice to Commence Work which bears more priority.

*Considering that the Contractor has given the Performance Bond and he has already received the Mobilization Advance and without anticipating the said delay, he was compelled to spend with the knowledge of the Employer as per "General Requirements" for renting buildings for Engineer's Office and Contractor's Site Office, Recruiting and Employing Project Management Team to attend to Preliminary Work, Hiring vehicles for them etc.

My problem is,whether the Contractor is entitled to claim these expenses.

Thank you.

Answer
Hi,
These expenses should, I guess, be made anyway and reimburse through Interim Pyment Applications and Interim Certificates. If they are - like renting buildings - time related items, you can claim them. It is strange to me that you were given the mobilization advance payment, since the Contract Agreement was not signed yet, but maybe the Applicable Law of your Contract allows this.
So, in your Programme of Works you should include also these activities and you should send in due time - see the providions of the Sub-clause 20.1 - the notice of claim for extending the time for the time related expenditures and for recovering these expenses.
All the best!
Alina

Construction Law

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Alina Valentina Oprea

Expertise

I can answer to questions regarding FIDIC 1999 contracts, including practical use of these conditions of contract, as well as to questions regarding dispute boards, both from theoretical and practical point of view. I cannot answer to questions related to other kind of contracts or to procurement process, except to some (limited) extent.

Experience

Implementation of works contracts (FIDIC 1999) financed by different financial institutions, including European Union; claims and disputes; dispute boards See more on www.alinaoprea.com

Organizations
Dispute Resolution Board Foundation

Publications
see http://alinaoprea.com/publications/ ; DRBF Forum Newsletter; Drumuri si Poduri; Revista Constructiilor; SIDiR Newsletter

Education/Credentials
Graduated the University of Civil Engineering Bucharest, Faculty of Railways, Roads and Bridges (1985-1990); Trained under Mr. Gwyn Owen’s pupilage program for arbitrators/adjudicators under FIDIC mentoring program (2006 – 2007)

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