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# Construction Law/LS Contract

Question
QUESTION: Dear Sir

For the lump sum contract assume that the 200 nr of light fittings are shown in the drawings. However the BOQ only have 150 nr and rate is QAR 25 (amount is 150 x 25 = 3750).

Later the engineer instructed to omit the particular type of light fittings in some area (qty 50 nr). There is a provision in BOQ to include missing items, and however the Contractor not corrected the qty.

Then correct rate for the omission is either 25 or 18.75 (3750/200).

Could you explain with reasons.

Br

Sudantha

Thanks for your question.

Rates generally under a contract are binding throughout the currency of the contract unless the contract provides otherwise. Here in the scenario, you have cited, the item of the light fittings has been priced at a rate of QAR 25 per no and it will be such and will not be subject to change. If 50no has been omitted, the omitted amount of the 50 no shall be calculated as 50 x QAR 25 = QAR 1,150 and same shall be deducted as the cost implication of the V.O (for the instruction to omit 50) from the contract sum.

There is no way any party can defend that the rate being considered by the Contract under the contract is QAR 18.75 when it was never mentioned in anywhere during the time of signing the contract. Since the Contractor failed to specifically identify the error and point it our for possible adjustment, it would be taken that, he has undertaken a risk to cover the under-measured or erroneous quantity somewhere else in the contract (i.e. the price for the short measured 50 x QAR 25 = QAR 1,250) has been provided for somewhere in the contract and as such, cannot be interpreted as 50 x QAR 18.75.

Hope this helps?

Best of luck.

Femi

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

QUESTION: Dear Sir

Yes sir my understanding is also the same. However if the scenario is not similar to the above and, there is no provision in BOQ to include missing items, then whether the rate  18.75 (3750/200) is correct?

Please be kind enough to give your convincing argument.

Br

Sudatha

Apologies for late response.

My answer is no. the rate of QR 25.00 would remain so throughout the currency of the contract. Rates are essential binding elements of a contract with BOQ and pricing documents. They cannot be changed at will. The only condition for a change of rate is only where the contract says it and it would have proper justification which the influencing basis is outside the Contract say like inflation and specifications changes. Without those factors, Contract rate cannot be changed at will.

Hope the clears your doubts?

Kind regards.
Femi

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

QUESTION: Dear Sir

My argument is that in the BOQ, already has the quantity 200, which is an error. His correct price is 18.75, however he cannot use this correct rate due to the quantity error (can't be changed) and no provision in the BOQ also to correct the quantity error ("Additions/Omissions"). Therefore he has to use rate 25 to adjust his total actual cost of 3750.

Therefore whether using this error rate for future variation is correct?

Br

Sudantha

Dear Sudantha,

There is nothing in the contract that qualifies the rate of QR 25 to be referred to as an error. You just imagined it. If that is an error, then, you could as well say that all other rates in the BOQ are erroneous. The fact is, there is no error in rate and can never be once a rate is stated. A rate is a rate, there could be an error when extending or multiplying rate with quantity, or in writing down the amount. that is arithmetic or computation error which has another modality to deal with it. The one you are referring to is purely a negligence that arose from non-due-diligence in verifying that the correct quantity stated in the Tender BOQ and drawings or specification tallies correctly without discrepancies. Depending upon the conditions of the contract and the Instruction to tenderers, most discrepancies in tender documents must be raised by tenderers and it would be properly addressed or alternatively, it could form a risk to be undertaken by the tenderers who may become the awardee. So, here, the QR 25 is rate and nothing but contract rate and should be addressed as such.

kIND REGARDS.
Femi
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#### Femi Alofe

##### Expertise

I can answer all questions relating to the followings: 1. Contract Administration - variations, contract clauses interpretation, all post contract procedures, valuations and certificates questions, extension of time issues and prolongation cost matters. 2. Contract Practice - Any questions regarding forms of contract like JCT, FIDIC & other Bespoke forms. 3. Quantification, measurements and Estimating questions 4. Contracts and construction law questions and dispute resolutions problems. 5. All FIDIC Conditions of contracts

##### Experience

Out of my 24 years experience in construction industry, i have the following specific experience: 1. Contract Administration - 15 years in contract administration with over 10yrs in Managerial positions covering africa and the middleeast. 2. Contract Practice - 15 years experience with over 10yrs in Managerial and expert positions covering africa, north america and the middleeast. 3. All pre-contract procedures, Tendering, Quantification, measurements and Estimating questions - 20 years experience. 4. Contracts and construction law questions and dispute resolutions problems - 15 years experience with over 10yrs in Managerial and expert positions and 5 years expert witness and active practice in arbitration proceedings covering africa and the middleeast.

Organizations
1. FAIQS - Fellow, Australian Institute of Quantity Surveyors, Australia 2. FRICS - Fellow, Royal Institution of Chartered Surveyors, UK 3. CCP - Certified Cost Professional AACEI, USA 4. PQS - CIQS, CANADA 5. ACIArb. - CIArb, UK 6. MNIQS - NIQS, NIGERIA 7. RQS - QSRBN, NIGERIA

Publications
1. AACEI RP on Estimating, 2010

Education/Credentials
1. B.Tech (QS) 2. RICS professional course, CEM - UK 3. MSc , UK NARIC 4. Professional Doctorate ( to commence 2016)

Past/Present Clients
1. Larsen & Toubro Ltd, Dubai UAE 2. Larsen & Toubro (oman) LLC 3. Archi + Web consortium, Abuja Nigeria 4. George Dike & Associates, Minna Nigeria 5. Public works Authority (Ashghal), Doha Qatar