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Contractor\'s Compensation
Contractor's Compensat  
Employer\'s Default
Employer's Default  
QUESTION: Dear Sir;

you will find attached a Clause 59 of General Conditions of the Contract + Article 152 of the applicable law ... they both speak about Contractor's Compensation .. please go through them thoroughly and help me by answering the followings:
1- May we use these both Clause & Article to manage a case of dispute between our Employer (we are the Engineer) and the Contractor .. The case in brief is that there is a part of filling materials quantities on site is under dispute, We see that it is to be borne by Contractor referring to a certain condition in the Contract whereas the Contractor sees that he is entitled to this part and always claim to get it paid ...  is this a case of compensation claim that lies under the attached clauses?

2- does the Contractor have any right to stop the work of this disputed part until having it settled Or he must continue the work without stoppage  based on that the Contract would be applied to settle the dispute?

Thank you Sir

ANSWER: Hello Khaled,


Thank you for your new question.

1. I understand the dispute is about a certain filling quantity which is to be executed, or not, hence, to be paid or not.

As I understand, it has not been concluded that Contractor is entitled to a certain payment, such payment has been certified and that such payment is now delayed.

If that would have been the case, Clause 59 would have applied.

But your case is different, hence you must refer to another Clause in the Contract.

2. Usually, Contractor should not suspend the work for a disputed issue. Dispute resolution should go in parallel with the works execution.

Normally, you should have a specific Clause in the Contract, indicating which reasons enable the Parties to suspend or terminate the Contract.

If described situation falls under such Clause, then Contractor has the right to suspend the work, if not, they don't.


Once again, it is difficult to answer, as I do not know which type of Contract Conditions you're using, all information is with you.

All I can do, is to guide you where to look and what to look for.

Hope that helps in the given conditions.

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

QUESTION: Hi Mr. Floren

1- May you please rephrase No. (1) again as I didn't get it. the dispute  is about a certain filling quantity which must be executed but it is about: are they  to be paid to the Contractor or its cost is to be borne by him.
The Contractor started the execution of the disputed quantity but he is feeling worried and kept sending letters to have the payment thereof approved but so far he hasn't taken any dollar of this disputed work. Again, Clause 59 as well as Article 152 could apply on our case or not? and why (again please)?

Thank you Sir,

Answer
Dear Khaled,


Thank you for coming back.

The Article that you indicated only refers to cases where the Employer does not pay and you can only use it when certain money are definitely due to the Contractor but Employer does not pay.

Your case is about establishing if the Contractor has to bear the cost of that filling, or, if he carries out the filling, he will have to be paid by the Contractor.

Thus, in this moment, you need first to establish this. And for this, indicated Article does not apply, you must look somewhere else in the Contract, or at how the situation you describe has occurred.

You must analyse how did you get at this point, compare the situation with the Contract Conditions and then draw a conclusion.

Again, right now, I can not help more as the Article you referred to me deals with something else. It is like in a restaurant where you ask me to choose a desert, but you only gave me the menu for the starters.

Please thus go back to your Contract and re-evaluate the situation.

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Florin NICULESCU

Expertise

Questions related to Civil Engineering Contracts, using FIDIC or other Conditions of Contract, concerning Procurement procedures and documents (pre-qualification, tendering and contracting) and Services/ Works Contracts implementation matters including Determinations, Payments, Time Extensions, VOs, Claims/Disputes. Additionally, questions related to dealing with International Financing Institutions. Can also answer questions in Romanian. Can not answer improperly formulated questions.

Experience

Over 20 years of experience in the field of design, works supervision, construction, management of aid funds and technical assistance for various types of contracts implementation, including severe conflictual contractual situations leading to Claims and disputes. Claims/ Contract management, Disputes adjudication, Arbitration.

Organizations
Member of Romanian Professional Association of Roads and Bridges; Listed on President's List of Adjudicators of Romanian Association of Consulting Engineers www.aric.org Former member of the Disputes Resolution Board Foundation (DRBF) of United States – nominee on DRBF President’s Disputes Board Members List www.drb.org and of DRBF Chapter for Eastern Europe http://dabdrb.googlepages.com Former member of Polish Association of Consulting Engineers (SIDiR) – nominee on SIDiR President’s Disputes Board Members National List http://www.sidir.pl/sidir/index.php?action=czlonkowie&a2=r Member of “AllExperts.com” volunteers pool http://www.allexperts.com/user.cgi?m=4&expID=85358&catID=914 Member of the "Constructions Disputes Resolution Services” International Panel of Construction ADR Specialists" of United States www.constructiondisputes-cdrs.com

Education/Credentials
- Graduate in 1994 the Construction Institute - Graduate of several FIDIC,Procurement and other courses - Graduate of first Disputes Board Members Mentoring Scheme (http://www1.fidic.org/resources/adjudicators/pupilage.html) - FIDIC Accredited Adjudicator

Past/Present Clients
- Several State organisations/Ministries , such as Ministry of Transport, National Admistration of Roads, Ministry of Regional Development (former Ministry of European Integration), Public Works and Housing, Central Contracting and Financing Unit in Romania and also in Turkey, Croatia and Macedonia - Numerous Western based private consultancy companies - full CV and other relevant information available at www.abinitio.ro

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