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A. Contract Forms Referenced:
1.
Fédération Internationale des Ingénieurs-Conseils
(International Federation of Consulting Engineers or FIDIC),
Conditions of Contract for Works of Civil Engineering
Construction, Part I, General Conditions, Fourth Edition
(1987, reprinted in 1988 and 1992 with amendments) (hereinafter
"FIDIC");
2.
Australian Standard, AS 4000--1997, General Conditions
of Contract (1997) (hereinafter "Australian Standard");
3.
The Institution of Civil Engineers (United Kingdom), The
Engineering and Construction Contract, Second Edition
(1995, reprinted with corrections May, 1998)
(hereinafter "ECC");
4.
Federal Acquisition Regulation (United States), Title 48,
Subpart 52.2, Code of Federal Regulations, Text of Provisions
and Clauses (1997) ("FAR");
5.
American Institute of Architects (United States), AIA Document
A201-1997, General Conditions of Contract for Construction
(1997) (hereinafter "AIA");
6.
Engineering Advancement Association of Japan (Japan), ENAA
Model Form International Contract for Power Plant Construction
(Turnkey Lumpsum Basis), Vol. I, General Conditions (1996)
(hereinafter "ENAA");
7.
Construction Industry Development Board (Singapore), Public
Sector Standard Conditions of Contract for Construction
Works (1995) (hereinafter "Singapore");
8.
GC/Works/1 Without Quantities, Contract for Building and
Civil Engineering Major Works, General Conditions (England,
1998) ("GC/Works/1");
9.
The Institution of Civil Engineers (United Kingdom), The
New Engineering Contract, First Edition (1993) ("EC
1993");
10.
The World Bank, Standard Bidding Documents, Procurement
of Works (1995) ("World Bank").
11.
Joint Contracts Tribunal for the Standard Form of Building
Contract (United States), Standard Form of Building Contract,
Private With Quantities (1980 Edition, incorporating
Amendments issued through April, 1998) ("JCT 80");
12.
Joint Contracts Tribunal for the Standard Form of Building
Contract (United States), Standard Form of Building Contract
With Contractor's Design (1981 Edition, incorporating
Amendments issued through April, 1998) ("JCT 81");
and
13.
Institution of Civil Engineers, Association of Consulting
Engineers and Federation of Civil Engineering Contractors,
ICE Conditions of Contract (Sixth Edition, January
1991; reprinted with amendments, November 1995; reprinted
November 1997) ("ICE 6th Edition").
B. Specific Risks and
Relevant Provisions
Ground
Conditions
FIDIC:
Contractor entitled to additional costs for expenses and
time extension for delays resulting from physical obstructions
or conditions except climatic conditions not reasonably
foreseeable by an experienced contractor (Sub-Clause 12.2)
or resulting from fossils, coins, articles of value or antiquity,
and structures and other remains or things of geological
or archaeological interest discovered at site (Sub-Clause
27.1).
Australian
Standard: Contractor entitled to additional costs incurred
upon encountering minerals, fossils or relics (Subclause
24.3). Contractor entitled to variation pricing (set by
agreement, in contract or as otherwise reasonable, including
amount for overhead and profit) for costs resulting from
latent physical conditions on or near site, including artificial
things but excluding weather conditions, that differ materially
from physical conditions which reasonably should have been
anticipated by competent contractor after reviewing tender
information (Subclauses 25.1-25.3, 36.4). Time extension
also is provided as a form of relief for delays resulting
from such conditions (Subclause 34.3).
ECC:
Contractor entitled to adjustment of contract price and/or
schedule for costs/delays resulting from physical conditions
within site, other than weather conditions, which an experienced
contractor would have judged at time of contracting to have
such a small chance of occurring that it would have been
unreasonable for it to have allowed for them (Clause 60.1.12).
FAR:
Contractor entitled to equitable adjustment of contract
price and/or time for costs/delays resulting from sub-surface
or latent physical conditions at site differing materially
from those indicated in contract, or unknown physical conditions
at site which are of unusual nature and differ materially
from those ordinarily encountered and generally recognized
as inhering in work of character provided for in contract
(Section 52.236-2).
AIA:
Contractor entitled to equitable adjustment of contract
price and/or time for costs/delays resulting from sub-surface
or otherwise concealed physical conditions which differ
materially from those indicated in contract documents, or
unknown physical conditions of unusual nature which differ
materially from those ordinarily found to exist and generally
recognized as inherent in similar construction activities
(Subparagraphs 4.3.4, 8.3.1; Paragraph 10.3).
ENAA:
Contractor entitled to additional costs for expenses and
time extension for delays resulting from physical conditions,
other than climatic conditions, or artificial obstructions
on site not reasonably foreseeable by experienced contractor
on basis of information provided by owner and information
obtainable through visual site inspection (GC 35.1-35.3).
Singapore:
Contractor entitled to additional costs for expenses and
time extension for delays resulting from artificial obstructions
which are encountered while carrying out sub-surface works
and are not reasonably foreseeable by experienced contractor
(Clauses 5.2; 22.1 (g)).
GC/Works/1:
Contractor entitled to adjustment of contract sum for value
of work carried out or omitted and/or extension of time
for delays due to ground conditions (excluding those caused
by weather but including artificial obstructions) which
he did not know of, and which he could not reasonably have
foreseen having regard to any information which he had or
ought reasonably to have ascertained. (Condition 7 (2) to
(5); Condition 36 (2)(d)). Contractor entitled to variation
pricing for actions taken upon discovery of fossils, antiquities
or objects of interest or value (Condition 40 (2)(n)).
JCT
80 and 81: These are remeasurement forms that effectively
place much of the ground condition risk on the employer.
The only express provision requires that the amount of Contractor's
direct loss and/or expense resulting from discovery and
specified treatment of fossils, antiquities and other objects
of interest or value at site shall be added to Contract
Sum, and time may extended for delays resulting from Architect's
variation instructions with respect to such items (Clause
34.3).
ICE
6th Edition: Contractor entitled to additional costs
plus reasonable profit and an extension of time for delays
resulting from physical conditions (other than weather conditions
or conditions due to weather conditions) or artificial obstructions
which conditions or obstructions could not reasonably have
been foreseen by an experienced contractor (Clauses 12 (1),
12 (6)). Even if Engineer believes such conditions were
reasonably foreseeable, any resulting variation ordered
by Engineer shall be valued according to specified rates
or prices, or approximations thereof, and included in contract
price (Clause 12 (5)).
Legal and Physical Impossibility
FIDIC:
Contractor released from performance obligations under contract
if legally or physically impossible to fulfill such obligations
(Sub-Clauses 13.1, 66.1).
Australian
Standard: Legal or physical impossibility, per se, not
addressed. Contract may be terminated for "frustration"
(not defined), with incident costs payable to Contractor
(Clause 40).
ECC:
Contractor to notify Project Manager if contract data requires
it to do anything illegal or impossible; Project Manager,
upon agreement, will give instruction to change contract
data accordingly (Clause 19.1).
FAR:
Legal or physical impossibility not addressed expressly.
Contractor shall not be in default for any failure to perform
the contract if such failure arises from causes beyond contractor's
control (Section 52.249-14).
A201:
Legal or physical impossibility not addressed expressly.
Contract provides that it shall not limit rights and remedies
otherwise available by law (Subparagraph 13.4.1). Hence,
availability of defense or excuse of impossibility depends
on applicable law.
ENAA:
Legal or physical impossibility not addressed expressly.
Contractor excused from performance to extent that such
performance is prevented by specified force majeure events
(GC 37.3).
Singapore:
Legal or physical impossibility not addressed expressly.
Contract provides that it shall not affect Contractor's
responsibilities under common law to complete works (Clause
4.1). Hence, defense or excuse of impossibility depends
on applicable law (which is law of Singapore, per Clause
36.1).
GC/Works/1:
Not addressed expressly.
JCT
80 and 81: Either party may terminate contract if work
is suspended for specified period by reason of force majeure
("force majeure" events not defined) (Clause 28A.1.1.1).
ICE
6th Edition: Contractor shall construct and complete
the work in strict accordance with the contract and to Engineer's
satisfaction "[s]ave insofar as it is legally or physically
impossible" for Contractor to do so (Clause 13(1)).
Care of the Works
FIDIC:
Contractor responsible for care of works during construction,
plus any outstanding works that Contractor undertakes to
finish during specified defects liability period, excluding
loss or damage caused by specified excepted risks (Sub-Clauses
20.1 - 20.4). All risk insurance required (Clause 21.1).
Australian
Standard: Contractor responsible for care of works from
commencement to practical completion, plus outstanding work
until final completion, excluding loss or damage caused
by specified excepted risks (Subclauses 14.1, 14.3). All
risk insurance required. (Clause 16).
ECC:
Contractor responsible for loss or damage to works until
defects certificate issued (Clause 82.1). All risk insurance
required (Clause 84.2).
FAR:
Contractor responsible for care of works until completion
and acceptance of all work except for any portion thereof
which has been completed and accepted (Section 52.236-7).
Insurance coverages specified individually for each contract.
A201:
Contractor shall provide reasonable protection to prevent
damage, injury or loss to the work and materials and equipment
to be incorporated therein which are under the care, custody
or control of Contractor or subcontractors (Subparagraph
10.2.1). Employer to provide all risk insurance (Clause
11.4.1).
ENAA:
Contractor responsible for care of works during construction
plus any outstanding works that Contractor undertakes to
finish during specified defects liability period, excluding
loss or damage caused by specified excepted risks (GC 32.1,
32.2, 38.1). All risk insurance required (Clause 34.1 (b)).
Singapore:
Contractor fully responsible for care of the works but entitled
to reimbursement for damage caused by excepted risks (Clause
25.1). All risk insurance required (Clause 28.1).
GC/Works/1:
Contractor shall during execution of work take all reasonable
measures and precautions needed to take care of site and
works and shall have custody of all goods and materials
on site intended to form part of works against loss or damage
from fire and any other cause (Condition 13 (1)). Contractor
responsible for protection and preservation of works and
all goods and materials on site intended to form part of
works until completion of works or contract termination
(Condition 30 (3)). All Risk coverage required in alternative
clause 8 (3).
JCT
80 and 81: "Care of works," per se, not addressed.
Contractor responsible for loss or damage to unfixed materials
and goods on- or off-site intended for use in work and paid
for by Employer (Clauses 16.1, 16.2). Parties to agree on
which of them will bear obligation to insure the work (Clause
22.1); such obligation terminates upon earlier of specified
completion date or Contractor's termination (Clauses 22A.1,
22B.1, 22C.1).
ICE
6th Edition: Contractor responsible for care of the
work and the materials, plant and equipment to be incorporated
therein from specified commencement date to substantial
completion (Clause 20 (a)), plus any outstanding work and
materials, plant and equipment which Contractor undertakes
to finish during specified defects correction period until
such outstanding work completed (Clause 20 (c)), excluding
any loss or damage caused by specified excepted risks (Clause
20 (2)). Employer assumes such care of any portion of work
upon substantial completion of such portion (Clause 20 (b)).
All risk insurance required (Clause 21).
Third Party Interferences
FIDIC:
Third-party interferences not addressed expressly, but Contractor
entitled to time and money if Employer fails to assure site
availability (Clause 42.2).
Australian
Standard: Third-party interferences not addressed expressly.
Contractor entitled to undisturbed possession of the site
(Subclause 24). Contractor also entitled to extension of
time for delays except those resulting from Contractor's
breach, industrial conditions or inclement weather occurring
after practical completion date, or other causes expressly
identified by parties at time of contracting (Subclause
34.3; Item 23 of Annexure Part A). Thus, it appears that
Principal bears risk of third-party interference unless
specifically excepted in the contract.
ECC:
Contractor entitled to adjustment of contract price and/or
schedule for costs/delays resulting from Compensation Events,
which include where third parties "do not work within
the times shown on the Accepted Programme or do not work
within the conditions stated in the Works Information"
(Clause 60.1.5).
FAR:
Third-party interferences not addressed expressly. Contractor
entitled to time extension for delays due to causes beyond
its control and not resulting from its fault or negligence
(Section 52.249-14).
A201:
Third-party interferences not addressed expressly. Contractor
entitled to time extension for delays by act or neglect
of Owner's other contractors as well as "causes beyond
the Contractor's control... or by other causes which the
Architect determines may justify delay."
ENAA:
Third-party interferences not addressed expressly. Contractor
entitled to schedule adjustment for events beyond either
parties' reasonable control (force majeure), which may be
read to encompass third-party interferences though such
events are not identified specifically in force majeure
definition (GC 37.1).
Singapore:
Contractor entitled to time extension for "compliance
with requirements of any... public service company"
(Clause 14.2 (e)) and to additional compensation for failure
of the employer to give possession of the site (Clause 22.1
(c)).
GC/Works/1:
Employer must provide Contractor possession of site by specified
date (Condition 34 (1)). Contractor entitled to an increase
in contract sum for expenses incurred by reason of delay
in being given possession of any part of site (Condition
46 (1)(b)).
JCT
80 and 81: Employer shall give Contractor possession
of site by specified date (Clause 23.1.1), and Contractor
is entitled to retain possession through practical completion
(Clause 23.3.1), but the form does not specify Contractor's
remedy if Employer breaches this obligation. Additional
time is allowed for delay due to "the carrying out
by a local authority or statutory undertaker of work in
pursuance of its statutory obligations or the failure to
carry out such work" (Clause 25.4.1).
ICE
6th Edition: Contractor entitled to additional costs
(plus profit in respect of any additional permanent or temporary
work) and extension of time for delays resulting from Employer's
failure to give possession of site at specified times (Clause
42(3)).
Changes in Law
FIDIC:
Contractor entitled to price adjustment for costs resulting
from change in or introduction of national or state statute,
ordinance, decree or law or regulation or by-law of local
or other duly constituted authority (Sub-Clause 70.2). Time
extension is not specified as relief in change in law provision.
Contractor is entitled to time extension for "special
circumstances which may occur" (Sub-Clause 44.1), though
it is not clear whether this would be read to include changes
in law.
Australian
Standard: Contractor entitled to price adjustment for
costs resulting from change in legislative requirements,
including acts, ordinances, regulations, by-laws, orders,
awards and proclamations of jurisdiction, and certificates,
licenses, consents, permits, approvals and requirements
of organizations with jurisdiction in connection with work
(Subclause 11.2). Time extension not specified as relief
in change in law provision. Contractor is entitled to time
extension for specified qualifying causes of delay, which
would normally include changes of law.
ECC:
Contractor entitled to adjustment of contract price and/or
schedule for costs/delays resulting from change in law of
country in which site located which occurs after contract
date (Optional Clause T1.1).
FAR:
Contract price shall be increased by the amount of any new
or increased federal excise tax or duty on transactions
or property covered by contract (Section 52.229-3). Changes
in other laws not addressed expressly. Contractor entitled
to time extension for delays arising from causes beyond
its control and not due to its fault or negligence (Section
52.249-14).
A201:
Changes in law not addressed expressly. Contractor is entitled
to time extension for delays from "causes beyond the
Contractor's control... or by other causes which the Architect
determines may justify delay" (Subparagraph 8.3.1).
ENAA:
Contractor entitled to equitable adjustment of contract
price for expenses and extension of time for delays caused
by change in or enactment of any law, regulation, ordinance,
order or by-law having force of law in country where site
located or any portion of plant is manufactured (GC 14.4,
36, 40.1(d)).
Singapore:
Contractor entitled to time extension for "compliance
with the requirements of any law, regulation, by-law or
public authority or public service company as stipulated
in Clause 7.1" (Clause 14.2 (e)).
GC/Works/1:
Not addressed expressly.
World
Bank: The World Bank replaces FIDIC Sub-Clause 70.2,
as well as the rest of Clause 70, with a clause containing
substantially more elaborate formulae for adjusting Contractor's
payments in the event that a change in law results in additional
or reduced costs to Contractor; however, the basic risk
allocation under FIDIC Sub-Clause 70.2, whereby Contractor
gets a price adjustment for a change in law, remains the
same in the World Bank's replacement clause.
JCT
80 and 81: Any alteration or modification to work necessitated
by change in defined statutory requirements after a specified
base date shall be treated as a variation instructed by
Architect (Clause 6.1.7), which may entitle Contractor to
adjustment of contract sum (Clauses 13.2.1, 13.4) and/or
extension of time (Clauses 13A.3.2.3, 25.3, 25.4.5.1). Contractor
also entitled to time extension for delays due to UK government's
exercise of any statutory power after base date which directly
affects execution of works by restricting availability or
use of necessary labor or preventing/delaying the securing
of necessary goods or materials (Clauses 25.3, 25.4.9).
ICE 6th Edition: Changes in law not addressed expressly.
Subcontractor Relations
FIDIC:
Employer's Engineer entitled to pay directly to nominated
subcontractors all payments, less retentions, which Contractor
fails to make to such subcontractors and to deduct by way
of set-off the amount paid from sums due from Employer to
Contractor (Sub-Clause 59.5).
Australian
Standard: Principal may pay directly to subcontractor
any sums which Contractor fails to pay to subcontractor
where permitted by law, given in a court order or upon Contractor's
written request. Such payment by Principal is deemed to
satisfy in part its payment obligation to Contractor (Subclause
38.3).
ECC:
Employer may establish trust fund for benefit of subcontractors,
among others. Trustees (paid and presumably appointed by
Employer) may make discretionary payments from fund to subcontractors
in amounts up to the value of payments due from but not
paid by Contractor (Optional Clauses V1-V3).
FAR:
Contractor shall furnish payment bond in an amount varying
according to contract price for all contracts over US$100,000
(Section 52.228-15 (b)(2)).
A201:
Owner may terminate contract if Contractor fails to pay
subcontractors (Clause 14.2.1.2) and accept assignment of
subcontracts (Subparagraph 5.4.1), whereupon subcontractor's
compensation shall be equitably adjusted for cost increases
resulting from suspension of work greater than 30 days (Subparagraph
5.4.2). Unless Contractor provides Owner with payment bond,
Contractor shall hold for subcontractors any payments received
from Owner for work performed by subcontractors, though
Contractor need not hold such sums in a separate account
(Subparagraph 9.6.7).
ENAA:
Contractor shall provide advanced payment bond (GC 13.2.1).
Singapore:
As in the Hong Kong GCCs and FIDIC.
GC/Works/1:
Employer entitled to order and pay for specified materials
directly from nominated subcontractors or suppliers and
to deduct such payments from contract sum, less Contractor's
profit adjusted pro-rata on such payment (Condition 63 (2)).
JCT
80: Employer entitled to pay nominated subcontractors
all amounts due under subcontract that Contractor fails
to pay (Clause 35.13.5.2).
JCT
81: JCT 81 does not appear to address the matter of
sub-contractor payment problems.
ICE
6th Edition: Employer entitled to pay directly to nominated
subcontractors all payments (less retentions provided for
in subcontracts) that Contractor fails to make (Clause 59
(7)).
Notice and Time Bar Provisions
FIDIC:
Contractor must provide to Employer's Engineer written notice
of claim for additional payment within 28 days after occurrence
of event giving rise to claim (Sub-Clause 53.1). If Contractor
fails to comply with notice requirement, its entitlement
to payment shall not exceed amount that Engineer or arbitrator
assessing claim considers verified by records (Sub-Clause
53.4).
Australian
Standard: Contractor must provide to Principal's Superintendent
written notice of claim for time extension within 28 days
of point when Contractor should reasonably have become aware
of event giving rise to claim (Subclause 34.3). Contractor
must provide to Principal written notice of any other claim
regarding contract as soon as practicable after becoming
aware of claim (Subclause 41.1). Failure to comply with
notice requirements shall entitle Principal to damages for
breach of contract but shall neither bar nor invalidate
claim (Subclause 41.2).
ECC:
Contractor notifies Project Manager of an event which has
happened or which it expects to happen that Contractor believes
will entitle it to extra time or money and if "it is
less than two weeks since [Contractor] became aware of the
event." (Clause 61.3). If the Project Manager has notified
the Contractor of his decision that the Contractor did not
give an early warning of a compensation event which an experienced
contractor could have given, the event is assessed as if
the Contractor had given early warning. (Clause 63.4)
FAR:
Contractor must provide Contracting Officer written notice
of differing site conditions promptly and before disturbing
such conditions. No claim for equitable adjustment for differing
site conditions shall be allowed absent such notice, though
Government may extend the time prescribed for notice (Section
52.236-2). Claims for delays caused by Contracting Officer
shall not be allowed for any costs incurred more than 20
days before Contractor notifies Contracting Officer in writing
and unless the claim is asserted in writing as soon as practicable
after delay ends but not later than final payment date (Section
52.242-17).
A201:
Contractor must provide Owner's Architect written notice
of claim for time or money within 21 days after occurrence
of event giving rise to claim or first recognizing condition
giving rise to claim, whichever is later (Subparagraphs
4.3.1, 4.3.2). There is no time bar.
ENAA:
Contractor must submit to Owner written notice of claim
for time extension as soon as reasonably practicable after
commencement of event giving rise to claim (GC 4.1, 40.2)
unless otherwise specified (e.g., force majeure events must
be noticed within 14 days of event (GC 37.2); unforeseen
physical conditions must be noticed promptly and before
additional work is performed (GC 35.1)). There is no time
bar.
Singapore:
Contractor must submit to Superintending Officer written
notice of event that Contractor believes entitles it to
time extension within 60 days of occurrence of event as
prerequisite to any such entitlement (Clause 14.3(1)). If
Superintending Officer considers Contractor's notice insufficient,
Superintending Officer may require Contractor to provide
further particulars of event within 14 days or such other
period as Superintending Officer selects (Clause 14.3(2)).
There is no time bar.
GC/Works/1:
As condition precedent to any right or remedy in respect
of unforeseeable ground conditions, Contractor must immediately
notify Project Manager of such conditions and state his
proposed responsive measures (Condition 7 (3)). Contractor
not entitled to an increase in contract sum for specified
prolongations and disruptions unless he provides notice
thereof to Project Manager immediately upon becoming aware
that progress of Works will be impacted thereby. (Condition
46 (3)(a)).
JCT
80 and 81: Contractor must submit a quotation regarding
estimated price adjustments for specified variations within
21 days from the later of the date of receipt of variation
instruction or the date of receipt of sufficient further
information to enable Contractor to provide such quotation
(Clause 13A.1.2). Contractor must make application for reimbursement
of losses and/or expenses resulting from specified events
as soon as it has become or reasonably should have become
apparent to Contractor that the progress of work has been
or was likely to be affected by such events (Clause 26.1.1).
Contractor must give notice whenever it becomes reasonably
apparent that the work is being or is likely to be delayed
if delay caused by specified events (Clauses 25.2.1.1, 25.3.1).
JCT 80 and 81 do not address implications of Contractor's
failure to timely provide the quotation, application and
notice discussed above.
ICE
6th Edition: If Contractor intends to claim a higher
rate or price for a variation than that notified to him
by Engineer or to claim any additional payment under the
contract, Contractor shall notify Engineer within 28 days
of the variation notice or the event giving rise to the
claim for additional payment (Clause 52 (4)(a) and (b)).
If Contractor fails to comply with this notice requirement,
then Contractor entitled to payment only to extent such
failure has not prejudiced Engineer or prevented Engineer
from investigating claim (Clause 52 (4)(e)).
Contractor
also shall within 28 days after the cause of any delay has
arisen or as soon thereafter as is reasonable notify Engineer
thereof (Clause 44 (1)). Contract does not indicate implications
of Contractor's failure to comply with this latter notice
requirement, though it does provide that Engineer may in
the absence of any such claim make his own assessment of
the delay he believes Contractor has suffered and shall
determine whether time extension is warranted (Clause 44
(2)(b)).
Variation Valuation
FIDIC:
Contractor entitled to additional costs (including overhead
but excluding profit (Sub-Clause 1.1 (g)(i)) for expenses
resulting from Engineer's failure to timely issue specified
drawings or instructions (Sub-Clause 6.4); encountering
unforeseeable physical obstructions or conditions (Sub-Clause
12.2); encountering fossils or other specified objects of
archeological or geological interest (Sub-Clause 27.1);
tests required by Engineer but not provided for in contract
(36.4); uncovering work where no defect exists (Sub-Clause
38.2); suspensions ordered by Engineer for reasons other
than Contractor's default or because needed for proper execution
of works or by reason of climatic conditions (Sub-Clauses
40.1, 40.2); Employer's failure to give Contractor possession
(Sub-Clause 42.2); damage to works or Contractor's equipment
or other expenses arising from specified force majeure risks
(Sub-Clauses 65.3, 65.5); termination upon outbreak of war
(Sub-Clause 65.8) or termination or suspension upon Employer's
default (Sub-Clauses 69.3, 69.4); rise in costs of labour
or materials (Sub-Clause 70.1); subsequent legislation (Sub-Clause
70.2); and subsequent currency restrictions (Sub-Clause
71.1).
Variations
ordered by Engineer valued at contract rates where applicable
and reasonable or, failing that, rates agreed upon between
Employer's Engineer and Contractor (Sub-Clause 52.1). If
disagreement, Engineer fixes rates. Engineer may elect to
have varied work performed on daywork basis (Sub-Clause
52.4). If variations result in additions to or deductions
from contract price in excess of 15 percent of such price,
contract price shall be adjusted accordingly by agreement
of Engineer and Contractor or, failing such agreement, by
Engineer with regard for Contractor's overhead and site
costs (Sub-Clause 52.3).
Australian
Standard: Contractor entitled to additional costs resulting
from discrepancies in contract documents (Subclause 8.1);
changes in legislation (Subclause 11.2); loss or damage
resulting from specified risks for which Principal is liable,
including Superintendent's negligence, war or similar hostilities,
nuclear radiation, Principal's use of project, and defects
in designs provided by those other than Contractor (Subclauses
14.2, 14.3); encountering valuable minerals, fossils or
other specified objects of archeological or geological interest
(Subclause 24.3); errors in setting out work caused by incorrect
information from Superintendent (Subclause 26.2); disturbances
to survey marks caused by Superintendent (Subclause 26.3);
Superintendent's directions regarding sequence of construction
program (Subclause 32); suspensions ordered by Superintendent
for safety reasons or pursuant to court order not made necessary
by Contractor or because of act or default of Superintendent,
Principal or other contractors (Subclause 33.4); and termination
by frustration (Clause 40).
Variations
directed by Superintendent are priced by agreement, by applicable
rates or prices in contract, or by using otherwise reasonable
rates or prices, which include reasonable amount for profit
and overhead (Subclause 36.4). Contractor entitled to variation
pricing for differing site conditions (Subclause 25.3).
ECC:
Contractor entitled to adjustment of contract price for
additional costs resulting from specified compensation events
(Clauses 60 to 65). Price adjustment assessed as to effect
of compensation event upon actual cost of work completed,
forecasted cost of work to be completed and resulting fee
(Clause 63.1). Adjustment depends on contract pricing (e.g.,
assessments for price adjustment for compensation events
occurring under contract with bill of quantities are in
form of changes to bill of quantities, with rates and lump
sums to be used at parties' option instead of actual cost
and resulting fee (Optional Clause B63.9)).
FAR:
Contractor entitled to adjustment in contract price, excluding
profits, for additional costs resulting from unreasonable
suspensions, delays or interruptions of work caused by Contracting
Officer (Sections 52.242-14, 52.242-17).
Contractor
entitled to equitable adjustment of contract price and time
for costs/delays resulting from change orders (Section 52.243-4);
stop-work orders (Section 52.242-15); and property furnished
in unsuitable condition by government (Section 52.245-2).
Contract price shall be equitably adjusted based on variations
between actual and estimated quantity of unit-priced items
greater than 15 percent above or below estimated quantity
(Section 52.211-18).
A201:
Contractor entitled to additional costs resulting from errors,
omissions or inconsistencies in contract documents (Subparagraph
3.2.3); written interpretations from Architect (Subparagraph
4.3.6); Owner's order to stop work where Contractor not
at fault (id.); written order for minor change in work issued
by Architect (id.); Owner's failure to pay (id.); Owner's
termination of contract (id.); Owner's suspension (id.);
shut-down, delay and start-up in connection with discovery
and disposal of hazardous materials not brought to site
by Contractor (Subparagraph 10.3.2); emergencies affecting
safety of persons or property (Subparagraph 10.6.1); and
uncovering and replacement of work as ordered by Architect
where no defect exists (Subparagraph 12.1.2).
Where
changes require adjustment of contract price, such adjustment
shall be based on mutually agreed lump sum; unit prices
stated in contract or otherwise agreed upon; cost plus a
fixed or percentage fee; or as determined by Architect on
basis of cost plus allowance for overhead and profit (Subparagraphs
7.3.3, 7.3.6).
Contractor
entitled to adjustment of contract price, including profit,
upon Owner's suspension or termination for convenience (Subparagraphs
14.3.2, 14.3.3). Contractor entitled to equitable adjustment
of contract price for costs resulting from concealed or
unknown physical conditions (Subparagraph 4.3.4).
ENAA:
Contractor entitled to costs resulting from tests or inspections
ordered by Owner and not provided for under contract (GC
23.5); compliance with Owner's instructions as to procession
of work in event of disputes regarding tests or inspections
or Owner's disapproval of specified documents, which disputes
are resolved in contractor's favor (GC 20.3.5, 23.7); uncovering
and replacement of work as ordered by Owner where no defect
exists (GC 24.8); unforeseen physical conditions (GC 35.2);
changes in tax rate or other legislation (GC 14.4, 36);
war and other specified hostilities (GC 38.4); preparation
of statement of adjustment of price, time and scope necessitated
by change that Owner requests and subsequently withdraws
(GC 39.9); suspension of work ordered by Owner for reasons
other than Contractor's breach or default (GC 41.3); and
termination for Owner's convenience (GC 42.1.3).
Changes
priced according to unit rates, including overhead and profit,
specified in contract or such other rates as agreed to by
Owner and Contractor (GC 39.5 and App. 3). Where no agreement
reached, price disputes to be referred to Engineer (GC 39.8).
Singapore:
Contractor entitled to costs resulting from discrepancies
and ambiguities in contract documents (Clause 4.4) and unforeseeable
artificial obstructions (Clause 5.2). Contractor also entitled
to recover loss and expense incurred as result of other
specified events (Clause 22.1). Variations valued according
to rates in contract if applicable; market rates and prices;
or cost plus 15 percent for overhead, profit and other related
expenses (Clause 20.1).
GC/Works/1:
Contractor entitled to adjustment of contract sum for extra
work carried out as a result of unforeseeable ground conditions
(Condition 7 (5)); and expenses incurred as a result of
Employer's execution of other work, Employer's delay in
providing Contractor any part of site or any delays due
to (i) design information provided by Project Manager, (ii)
directions by Employer or Project Manager regarding site
access passes or nominations or (iii) advice from Planning
Supervisor other than that required by Construction Design
and Management Regulations (Condition 46 (1) and (2)).
Contractor
entitled to reimbursement for costs or expenses incurred
in replacing or repairing any loss or damage caused by:
negligence or default of Employer or Employer's other contractors;
specified risks; unforeseeable ground conditions (contract
distinguishes between extra work performed because of such
conditions, for which Contractor entitled to adjustment
of contract sum, and loss or damage resulting from such
conditions, for which Contractor entitled only to reimbursement
of resultant expenses and costs); or other circumstances
beyond the control of and not reasonably foreseeable by
Contractor (Condition 19 (5)).
Variations
valued as lump sum proposed by Contractor, scheduled rates,
measurements at rates deduced from scheduled rates or at
fair market rates, or materials used and labor employed
on daywork charge basis (Condition 42 (2), 42 (5)).
World
Bank: Under FIDIC, Contractor entitled to additional
costs (including overhead but excluding profit) for expenses
resulting from, inter alia, loss or damage to Contractor
arising out of termination upon Employer's default (Sub-Clause
69.3). The World Bank deletes this provision from Sub-Clause
69.3.
JCT
80: Contract sum shall be increased by amount of Contractor's
direct loss and/or expense incurred as a result of (i) Architect's
late submission of instructions, drawings, details and levels
for which Contractor applied; (ii) uncovering and testing
of work and making good the consequences thereof, at Architect's
instruction where no defect exists; (iii) discrepancies
between contract drawings and specified documents; (iv)
work performed by Employer or its other contractors, or
material supplied by Employer which Employer agreed to provide
or the failure to so supply; (v) Architect's instructions
to postpone work; (vi) Employer's failure to timely provide
ingress to or egress from site upon notice or as otherwise
agreed; (vii) Architect's instructions requiring variations
or regarding expenditure of provisional sums; (viii) execution
of work for which the amount specified in bills of quantities
is an inaccurate forecast of quantity of work required;
or (ix) Employer's compliance or non-compliance with obligations
regarding planning supervisor and principal contractor under
Construction (Design and Management) Regulations of 1994
(Clauses 26.1, 26.2, 26.5, including Amendment No. 14 issued
March 1995).
Variations
priced according to specified rules (Clauses 13, 13A).
JCT
81: Contract sum shall be increased by amount of Contractor's
direct loss and/or expense incurred as a result of (i) uncovering
and testing of work, and making good the consequences thereof,
at Employer's instruction where no defect exists; (ii) delay
in receipt of permission or approval for purposes of Development
Control Requirements necessary for execution of work; (iii)
work performed by Employer or its other contractors, or
material supplied by Employer which Employer agreed to provide
or the failure to so supply; (iv) Employer's instructions
to postpone work; (v) Employer's failure to timely provide
ingress to or egress from site upon notice or as otherwise
agreed; (vi) Employer's instructions effecting a change
or regarding expenditure of provisional sums; (vii) Employer's
delay in providing Contractor necessary instructions, decision,
information or consents; or (viii) Employer's compliance
or non-compliance with obligations regarding planning supervisor
and principal contractor under Construction (Design and
Management) Regulations of 1994 (Clauses 26.1, 26.2, 26.3,
including Amendment No. 8 issued March 1995).
Changes
priced according to specified rules (Clause 12.5).
ICE
6th Edition: Contractor entitled to costs incurred as
a result of (i) Engineer's failure to timely issue specified
drawings, specifications or instructions (Clause 7 (4)(a));
and (ii) uncovering and replacing work at Engineer's instruction
where no defect exists (Clause 38 (2)).
Contractor
entitled to costs (plus profit in respect of any additional
permanent or temporary work) incurred as a result of (i)
delays or disruption in Contractor's arrangements or methods
of construction caused by Engineer's instructions to the
extent such costs could not reasonably have been foreseen
by an experienced contractor at the time of tender (Clause
13 (3)); (ii) Engineer's unreasonable delay in consenting
to Contractor's proposed construction methods (Clause 14
(8)); (iii) Engineer's requirements regarding such methods
or limitations imposed by any of the design criteria supplied
by Engineer, which requirements or limitations could not
reasonably have been foreseen by an experienced contractor
at the time of tender (Clause 14 (8)); (iv) affording all
reasonable facilities for other contractors employed by
Employer and other specified entities pursuant to Engineer's
requirements to the extent such costs were not reasonably
foreseeable by experienced contractor at time of tender
(Clause 31 (2)); and (v) suspensions ordered by Engineer,
except to the extent such suspension is otherwise provided
for in Contract, necessary by reason of weather or Contractor
default or necessary for proper execution or safety of work
and necessity does not arise from specified excepted risks
(Clause 40 (1)).
Variations
valued according to specified rates and prices or fixed
by Engineer based on such rates and prices (Clause 52 (1)
and (2)). Engineer may elect to have additional or substituted
work performed on a daywork basis (Clause 52 (3)).
Dispute Resolution
FIDIC:
Disputes determined initially by Engineer within 84 days
of reference, then by arbitration under ICC Rules (Sub-Clauses
67.1, 67.3). Arbitration to be noticed within 70 days of
Engineer's decision or after period for such decision has
expired (Sub-Clause 67.1) and may proceed on or after 56
days from notice date (Sub-Clause 67.2).
Australian
Standard: Disputes initially referred to party representatives
within 14 days of notice of dispute (Subclause 42.1). If
no resolution within 28 days of notice, dispute referred
to arbitration (Subclause 42.2).
ECC:
Disputes initially referred to independent adjudicator,
who must determine dispute within four weeks from notice
and submission of information. Party dissatisfied with decision
or lack thereof may then refer dispute to tribunal (arbitration
or otherwise based on parties' agreement) for final determination
upon notice within four weeks after adjudicator notifies
or should have notified parties of decision (Clauses 90-93).
FAR:
Specified disputes initially must be referred to Contracting
Officer within six years of accrual date. Time limits for
decision vary based on claim amount. Upon mutual consent,
parties may use alternative dispute resolution. Contractor
may appeal Contracting Officer's decision to an agency board
of contract appeals or file suit in U.S. Court of Federal
Claims; decisions of either of these entities then may be
appealed within U.S. federal court system (Section 52.233-1).
A201:
Disputes initially must be referred to Architect within
later of 21 days after occurrence of event giving rise to
dispute or 21 days after claimant recognizes condition giving
rise to dispute (Subparagraphs 4.3.2; 4.4.1). Disputes then
must be referred to mediation under AAA Rules upon the earlier
of Architect's decision or 30 days after submission to Architect
(Subparagraph 4.5.1). Arbitration or legal/equitable proceedings
stayed for 60 days from date mediation request filed (Subparagraph
4.5.2). Disputes then subject to arbitration under AAA Rules
unless otherwise specified (Subparagraph 4.6.1). Arbitration
to be demanded within specified time limits and no later
than expiry of applicable limitations period for legal or
equitable proceedings (Subparagraph 4.6.3).
ENAA:
Disputes initially referred to parties' representatives
for resolution (GC 6.1.1). If no resolution within 30 days
of notice, dispute then referred directly to arbitration
(GC 6.1.2) unless dispute involves specified matter, in
which case it may be referred to Expert for timely determination
before being submitted to arbitration (GC 6.2.1).
Singapore:
Disputes, unless otherwise specified, initially referred
to Superintending Officer, who must decide within 30 days
of reference (Clauses 34.1, 34.3). Within 90 days of receipt
of Superintending Officer's decision or the date by which
such decision should have been made, parties may give notice
of intent to refer dispute to arbitration (Clause 34.2).
Reference to arbitration shall not be made before substantial
completion date (Clause 34.2) except references to arbitration
of termination disputes, which shall be made within 60 days
of event giving rise to dispute (Clause 34.3).
GC/Works/1:
Disputes may be referred on seven days' notice to specified
independent adjudicator, who shall notify parties of his
decision within 28 days of referral, which period may be
extended by any amount if the parties agree or by 14 days
if referring party consents. (Condition 59 (1) to (4)).
Adjudicator's decision binding until dispute finally determined
by legal proceedings, arbitration or agreement (Condition
59 (7)). Financial compensation is Contractor's sole remedy
against Employer with respect to certain specified decisions
by Employer (Condition 59 (8)).
Disputes
shall be referred upon notice to specified arbitrator (i)
after completion or abandonment of works or termination
of contract, and (ii) where dispute initially was referred
to adjudicator, after expiry of specified time period unless
party serving notice of arbitration does so later than 56
days after receipt of adjudicator's decision, in which case
such decision becomes unchallengeable. (Condition 60 (1)
and (2)). Arbitrator shall provide decision within three
months from end of scheduled period (not to exceed six months)
for pleadings, discovery and hearing. (Condition 60 (2)).
World
Bank: Under FIDIC, disputes determined initially by
Engineer within 84 days of reference, then by arbitration
under ICC Rules (Sub-Clauses 67.1, 67.3). The World Bank
includes the following three versions of Clause 67 (Settlement
of Disputes):
Version
1: Provides for disputes between parties to be referred
to a Disputes Review Board consisting of three members.
Version
2: Like Version 1 except disputes referred to a single Disputes
Review Expert.
Version
3: Like FIDIC Clause 67 except Engineer must be independent
from Employer.
Version
1 is mandatory for contracts estimated to cost in excess
of $US50 million. Employers may select any of the three
versions for contracts between $US10 million and $US50 million.
Contracts smaller than $US10 million should follow the dispute
resolution procedures set forth in World Bank's Standard
Bidding Documents, Procurement of Works, Smaller Contracts.
JCT
80 and 81: Parties may specify whether disputes or differences
arising under the contract are to be decided by arbitration
(Article 7A, Clause 41B) or litigation (Article 7B, Clause
41C). Whichever dispute resolution mechanism is chosen,
either party initially may require such disputes or differences
to be referred on seven days' notice to specified independent
adjudicator (Article 5, Clause 41A). Adjudicator's decision
is binding until dispute finally determined by legal proceedings,
arbitration or agreement (Clause 41A.7.1)
ICE
6th Edition: Matters of dissatisfaction shall be referred
to Engineer, who must decide the matter within one month
of referral (Clause 66 (2)). If either party is dissatisfied
with Engineer's decision or if a decision has not been given
within time allowed, either party may serve a notice of
dispute (Clause 66 (3)). Parties have option to conciliate
or adjudicate dispute before there is a reference to arbitration
(Clauses 66 (5), 66 (6)). All disputes arising under Contract
shall be finally determined by arbitration (Clause 66 (9)).
Value Engineering
FIDIC:
Value engineering (i.e., alternative designs proposed by
Contractor) not addressed.
Australian
Standard: Value engineering not addressed.
ECC:
Value engineering not addressed.
FAR:
Contractor encouraged to prepare and submit value engineering
change proposals which will reduce contract price without
impairing project's essential characteristics. Contractor
shall share in any contract savings realized from acceptance
of such proposals (Section 52.248-3).
A201:
Value engineering not addressed.
ENAA:
Contractor may at any time during performance of work propose
to Owner any change it considers necessary or desirable
to improve quality, efficiency or safety of the work. Owner
may at its discretion approve or reject any such change
(GC 39.2). Contract price to be adjusted accordingly per
rate schedule or parties' agreement (GC 39.5).
Singapore:
Value engineering not addressed.
GC/Works/1:
Contractor may at any time during execution of work submit
to Project Manager proposals it believes will enhance the
buildability, increase the efficiency, reduce the cost of
works or reduce the cost of maintenance. Contractor and
Employer share in resultant savings and project schedule
extended as necessary. (Condition 38 (4) to (7)).
JCT
80 and 81: Value engineering not addressed expressly.
ICE
6th Edition: Value engineering not addressed expressly.
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