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•Delay damages shall be paid for every day which elapses between the relevant time for completion and the date stated in the taking over certificate subjected to maximum liability as stated in the particular conditions.
•Delay damages are due to slow rate of actual progress as compared to the ‘programme’ due to the reasons attributed to the contractor’s default and leads to additional cost to the employer.
•Extension of time creates a win-win situation, through which the employer is protected against the loss of delay damages and the contractor becomes released from liability for delay damages.
•It is not appropriate to agree to milestones in combination with delay damages. However if sections of works (which are not milestones) have different importance to the employer different delay damages rates can be fixed.