Content of the pre-2017 FIDIC forms

Clauses 6 and 7

Clauses 6 and 7 deal with personnel, and with plant, materials and workmanship. Clause 6 has particular importance in relation to personnel. The contractor must not only engage labour and staff, but must also make appropriate welfare arrangements for them.

Clause 7 includes detail on the inspection and testing procedures and gives the engineer the right of rejection if:

‘... any Plant, Materials or workmanship is found to be defective or otherwise not in accordance with the Contract’

© The International Federation of Consulting Engineers - FIDIC

In the event of rejection, the contractor is obliged to make good the problem to ensure compliance with the contract.

Clause 8

Clause 8 relates to commencement, delay and suspension.

Subclause 8.1 requires the contractor to 'proceed with the Works with due expedition and without delay' and in the English decision Obrascon Huarte Lain SA v Her Majesty’s Attorney General for Gibraltar [2015] EWCA Civ 712 the Court of Appeal confirmed that such obligation under subclause 8.1 is not directed to every task on the contractor’s to-do list, but it is directed to activities which are or may become critical.

Subclause 8.3 sets out the manner in which the contractor should provide programmes showing how he proposes to execute the works. For example, the programme must be supported by a report describing the methods which the contractor is to adopt.

Compared to the provisions relating to programme in other forms of contract such as the JCT, this clause is extensive. This is because the programme is designed as a project management device which is revised by the contractor ‘whenever the previous programme is inconsistent with actual progress or with the Contractor’s obligations.’

This compares to the position under the JCT where the contractor is only required to update the programme following a ‘delaying event’. Under the FIDIC the contractor’s role is far more pro-active.

The extension of time provisions are made clear by subclause 8.4:

'... the contractor shall be entitled to an extension of the Time for Completion if and ... to the extent that completion is or will be delayed by any of the following causes ...' The International Federation of Consulting Engineers - FIDIC

Subparagraphs 8.4(a) – (e) set out the clauses that will entitle the contractor to claim an extension of time.

In the English decision Osbracscon Huarte Lain SA v Her Majesty’s Attorney General for Gibraltar [2014]  EWHC 1028 (TCC) provides useful guidance on the inter-relationship between subclause 8.4 and subclause 20.1 which contains a condition precedent to claims for additional time and cost. Contrary to popular understanding, the judge could not see any reason why subclause 20.1 should be construed strictly so that notice would be required even when an event does not immediately effect the completion date.

Subclause 8.7 deals with delay or liquidated damages – the level of delay liquidated damages should be set out in the appendix to tender. To be able to levy such damages, the employer must make an application in accordance with subclause 2.5.

Clauses 9 and 10

The procedure for the testing and hand over of the works to the employer is dealt with in clauses 9 (Tests on completion) and 10 (Employer’s taking over.)

The works shall be taken over by the employer when they are:

• completed in accordance with the contract (which includes passing the tests on completion); and
• the taking over certificate has been issued.

Once the contractor has provided the employer with the as-built documents and the operation and maintenance manuals, they are to give 21 days' notice to the employer of when he will be ready to carry out the tests on completion. These tests will determine whether the works are ready to be taken over by the employer.)

Clause 9 sets out the types of tests to be carried out (although it is likely that these will be modified or supplemented in the contract documents) and the steps to be taken if any of the tests are failed.

The contractor may apply by notice to the engineer for a taking-over certificate no earlier than 14 days before the works will be in his or her opinion complete and ready for taking over. The engineer shall either issue the taking-over certificate or reject the application within 28 days of receipt. If the engineer fails to take either step during this period, as long as the works are ‘substantially in accordance with the contract’, the taking-over certificate shall be deemed to have been issued on the last day of the period.

Clause 11

Clause 11 details the defects process, while the length of the defects notification period will be set out in the appendix to tender. The contractor is liable for the cost of remedying defects and the employer has the right to engage a third party (at the contractor’s cost) if the contractor fails to comply with its obligations.

The engineer issues the performance certificate after the expiry of the defects notice period and the contractor has complied with its obligations (including remedying defects) and the performance certificate constitutes acceptance of the works.