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6CN011 Contract Law and

Dispute Resolution (Qatar)

Module Review 2
30 March 2012

FIDIC: The Priority of


Contract Documents (Clause
1.5)
1.
2.
3.
4.
5.
6.
7.
8.
9.

The Contract Agreement


The Letter of acceptance
The Letter of Tender
The Particular Conditions
The General Conditions
The Specification
The drawings
The schedules
Any further documents
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The Employer (Clause 2):


Some Roles of

Nominating Engineer
Giving possession of the site on time (2.1)
Obtaining planning permissions for the
Permanent works
Providing assistance to obtain permits (2.2)
Cooperate with the Contractor, generally
Ensuring own personnel comply with safety
requirements & protect the environment (2.3)
Making payment upon certification
Provide to the Contractor evidence of
financial arrangement to pay the Contract
price (2.4)
3

The Engineer is expected to make


certain Determinations under
Clause 3.5 of the FIDIC form
Identify a minimum of 6 issues on
which the Engineer is required to
make a determination.

Resource Management:
Staff and Labour

Contractor shall arrange to hire, pay,


maintain staff (6.1)
Remuneration and conditions of
engagement shall not be lower than
those prevailing (6.2)
Contractor shall not poach staff from the
Employers organisation (6.3)
Contractor to comply with labour laws
(6.4)
Etc
5

The Programme (8.3)

The Engineer requires programme to:


1.
Organise their office re: drawings,
schedules, nominated s/cs
2.
Organise their engineering staff and
inspectors
3.
Monitor the contractors progress
4.
Establish the cash flow (for the
Employer)
5.
Monitor claims for extensions of time
6

The Programme (8.3)

The Contractor requires programme


to:
1.
2.
3.
4.
5.

Organise subcontractors,
Procure plant, labour and materials
Plan and control the works
Establish the basis of claims
Establish the cash flow

Extension of time for completion


(8.4)

Grounds for e.o.t. include:

A variation or other substantial change


in quantity
Delay under sub-clause of these
conditions
Exceptionally adverse climatic
conditions
Shortages in personnel or goods caused
by epidemic or government actions
Delay caused by the employer
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Extension of time for completion


(8.4)

The following clauses carry an


entitlement to an extension of time plus
cost and a reasonable profit

1.9 Delayed drawings and instructions


2.1 Right of access to the site
4.7 Setting out
7.4 Testing
10.3 Interference with Tests on Completion
16.1 Contractors entitlement to suspend
work
9

Contract Price and Payments (Clause


14)

Application for interim Payment


Certificates to consider (14.3):

Estimated contract value


Adjustment for changes in legislation and
changes in cost
Deduction of retention
Advanced payments
Plant and materials intended for the works
Claims and disputes
Deductions of other certificates

NB: Contractor to supply 6 copies


monthly
10

Termination by Employer (Cl 15)


Employer can also terminate if
Contractor:
Subcontracts the works
Assigns the contract
Becomes bankrupt or insolvent
Demonstrates being corrupt (bribery,
etc)
Further; Employer can terminate by
reason of convenience (15.5)

Suspension and termination by


the Contractor
1. Contractor can stop (Suspend) work
or slow-down, [after 28 days
notice], if Employer does not:
issue payment certificate
Provide evidence of Financial
Arrangement

2. Contractor can further


1. Terminate the Contract if the Employer
does not rectify (1) above
2. Claim for losses therein
. Engineer to agree or determine matters

Claims (clause 20)

Contractors Claims (20.1)

Contractor to give notice within 28 days describing the circumstances


28 days of becoming aware; or
28 days Contractor should have been aware
Contractor forfeits the right to a claim for
failing to give a notice within 28 days
Contractor should keep contemporary records
in support of claims

Either on site or at location(s) acceptable to


Engineer
Engineer allowed to inspect documents,
13 following a

Claim - Timing

Contractor to submit claim within 42 days of


becoming (or should have become) aware
Contractor can claim on a continuous basis if
the source of claim has a continuous effect
Engineer to respond to a claim within 42 days
Decision = 1) Approved or 2) Disapprove
Engineer may request further details along
with the decision
Engineer to establish (any) additional time or
cost to which the Contractor is entitled
Approved payment(s) incorporated in (next)
Payment Certificate
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Tutorial Question 1

STECH Developments Ltd. is surprised and embarrassed to


receive a claim for loss and expense and extension of time in
respect of a project completed five years ago.
Assuming that the contract for the construction of the project
works incorporated the FIDIC form, advise STECH who was the
Employer under the contract.

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Tutorial Question 2

Bigbuilder Ltd. entered into a construction contract with a


Yankeetex Bank, a US conglomerate for the design and
construction of its European Head Office in Doha. The contract
incorporated an arbitration agreement referring all future
disputes to arbitration in Doha.
Bigbuilder served notice to refer a payment dispute to
adjudication and applied to the RICS Qatar Branch to
nominate an adjudicator. Yankeetex has responded that it is not
ready to participate in any micky mouse arbitration. Advise
Yankeetex on the adjudication process and the likely outcome if
it refuses to participate.

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