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Construction Law/Loss/Expense: Invoices + 15%

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Question
Dear Peter,

We are the Main Con.

The Contract cites “ …… loss/expense ……… provide invoices …… +15% for admin, overheads and profit…...”

We, for Corporate Policy reasons, will not provide Invoices to substantiate our Claim(s).

Our Claim is submitted on basis of Quotation (cheapest of 3) + 35% (note: not 15%).

The 35% represents our actual overheads at 28% (for this Project) and profit at 7% (Corporate level). Let’s assume that said uplifts are verifiable.

The Employer’s position is “we pay Quotation with no uplift or Invoice +15%. Your decision”

Who is correct?

Answer
Dear martincymru,

As the Employer states 'your decision'.  

The Contracts states the basis for reimbursement, but you want to change it unilaterally.  On what contractual basis?  I suggest that you would find it very difficult to justify 35% overheads, especially if you had to do it on the basis of audited accounts.  

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Peter M. Elliott

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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 www.eotprotocol.com before submitting a question.

Experience

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')

Organizations
Institution of Civil Engineers, Association of Chartered and Certified Accountants, Society of Construction Law, Dispute Resolution Board Foundation

Education/Credentials
B Sc(Hons) in Civil Engineering

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