Ss training fidic moustafa ismail 2017 _ lec. 1

Project Management
Development
FIDIC Forms of Contracts
How to think?
July 2017
Riyadh-KSA
123 July 2017SS FIDIC Training 1011 BTA - Dr. Moustafa Ismail July 2017 LEC- I How to think?
Course no- 1011BTA

Dr. Eng. Moustafa Ismail Abu Dief
PhD. CFCC™, FICCP, MCIOB, PMP®, RMP®, ACIArb, CCP
TOT level 2, 2008
Contracts and Claims Manager - Certified Claims Consultant
www.ZBenaa-pm.com
https://www.facebook.com/groups/1541580426160256/
https://www.facebook.com/Moustafa-Ismail-150838095005187/
SS FIDIC Training 1011 BTA - Dr. Moustafa Ismail July 2017 LEC- I How to think? 2
Training Course:
Saudi Council of Engineers
23 July 2017

international federation of national associations of independent consulting engineers
SS FIDIC Training 1011 BTA - Dr. Moustafa Ismail July 2017 LEC- I How
to think?
3
Training Course:
23 July 2017
LECTURE ONE
‫وبركاته‬ ‫هللا‬ ‫ورحمة‬ ‫عليكن‬ ‫السالم‬
23-07-2017

.
• Introduction
• FIDIC Documents
• Risk
• Procurement
• Strategy
• First 100 days
• Responsibilities
• Nominated Sub-Con.
• Staff & labour
• Plant & Materials
• Commencement
• Delays
• Taking Over
• Measurement
• Guarantees
• Claims
• Short Form
• Disputes/ Resolution
23 July 2017
Contents

FIDIC:
AN INTRODUCTION
• Founded in 1913
• Expanded in 1945 to include 40 national
associations
• Published first Conditions of Contract in 1957
• In 2004 has 64 member associations
• Headquarters in Switzerland
• Web Site : www.fidic.org
SS FIDIC Training 1011 BTA - Dr. Moustafa Ismail July 2017 LEC- I
How to think?
523 July 2017

FIDIC FORMS of Contracts
How to think?
6
1. Introduction To The FIDIC Contracts
FIDIC stands for the “Fédération Internationale
des Ingénieurs-Conseils” and is the French acronym for
the international federation of national associations of
independent consulting engineers. FIDIC was founded in
Belgium in 1913. The objectives the federation were :
“to promote … the professional interests of the
member associations and to disseminate information
of interest to members of its component national
associations.”
23 July 2017

Foreword
SS FIDIC Training 1011 BTA - Dr. Moustafa Ismail July 2017 LEC- I How to
think?
723 July 2017

FIDIC forms of Contracts
• In 1957 FIDIC published the 1st.
edition of its Conditions of Contract for Works of Civil
Engineering Construction, became to be known as the
“RED Book”.
First “red book” based on UK ICE conditions
think?
823 July 2017

International forms of contract
• Federation International des Ingeneurs-Counseils
(FIDIC);
• Other notable standard forms have been
developed for use internationally by:
 the Engineering Advancement Association of Japan
(ENAA);
 Joint Contracts Tribunal (JCT) in the United Kingdom;
 the European Development Fund (EDF);
 Institution of Civil Engineers New Engineering Contract (NEC3).
to think?
923 July 2017

FIDIC Documents
• Old “rainbow books” ‫قزح‬ ‫قوس‬needed revision
• Changes within International Projects &
Contracting
• Standardisation
• Clauses to meet current practice
• Update “Engineer” and consultant role
• Introduce “Disputes Adjudication Board”
How to think? 1023 July 2017

FIDIC 1999 Documents
• Conditions of Contract for Construction (Red Book)
• Conditions of Contract for Plant & Design
Build (Yellow Book)
• Conditions of Contract for EPC Turnkey
Projects (Silver Book)
• Short Form of Contracts (Green Book)
How to think?
1123 July 2017

think?
12
 The Form of Contract for Dredging and
Reclamation Works (The Blue Book)
 The MDB Harmonized Conditions of Contract for
Construction (The MDB Edition)
 Client/Consultant Model Services Agreement
(„The White Book‟, 3rd ed, 1998)
FIDIC 1999 Documents- continued
23 July 2017

New Contract Features in FIDIC Contracts
• Simple Language
o 20 Clauses & 163 Sub Clauses/ 72 clauses in 1987
• Engineer instead of Employer’s Representative
Clause 1.1.2.4
• Employer's Claims Clause 2.5
• Contractor’s Claims Clause .20.1
• Value Engineering Clause 13.2
• QUALITY & PROCEDURES: Cl.4.9, 4.18, 6.7, 8.3, 13.2 & 13.3
How to think?
1323 July 2017

Formats of FIDIC Documents
• Acknowledgements
• Foreword & Charts
• General Conditions
• DAB Conditions
• Directive and Guidance Notes
• Forms of Agreements
• Appendix to Tender
think? 1423 July 2017

Conditions of Contract for Construction
Red. Book
• Works designed by Employer or Engineer
• Contractor Constructs in accordance
with designs provided
• May include some design elements
How to think?
1523 July 2017

FIDIC Conditions of Contract (Y Book) for Plant
& Design Build
• Electrical & Mechanical Plant
• May include building and engineering
• Design & Execution of works
• Contractor designs and constructs in
accordance with Employer’s Requirements
• Engineer Administers
How to think? 1623 July 2017

Features of Plant & Design Build Contract
• General Comments:
Contractor will economise
Employer will supervise
More risk for Employer Variations
Good for Lump Sum
Design Savings
Employer responsible for ER errors
Risk Shared
How to think?
1723 July 2017

FIDIC Conditions of Contract for:
EPC/Turnkey Projects ( Silver Book)
• Process or Power Plant
• Infrastructure Projects
• High Degree of Certainty
• Contractor has total responsibility for Design
& Execution
• Administered by Employer- no Engineer
think? 1823 July 2017

Features of EPC/Turnkey Form (Silver Book)
• General Comments
o Not suitable when:
• No time to tender
• Much underground works
• If Employer wishes to supervise
• If payments need to be administered
think?
1923 July 2017

Featured Clauses in EPC Contracts
• Single point of responsibility – Contractor/all design,
engineering, procurement, construction, commissioning and testing
• If EPC Contractor is a JV, liability/responsibility is joint
• Fixed Contract Price – limited Contractor‟s RF changes
• Constrained Duration and definite date for completion. Any
delay will activate LD which is properly predefined based on
actual losses
• Extension of time, sub-clause 8.4 C granted where Contractor
is inculpable
23 July 2017
think?
20

FIDIC Short Form of Contract Green Book
• Small capital value projects Up to 500 $
• Simple content
• Contractor constructs to Employer’s designs
• No use for “Particular Conditions”
• No identification of “Impartial” Engineer/ consultant
, it shows authorized person and Emp. representative
think?
2123 July 2017

COMMUNICATIONS in FIDIC
• Cl.1.3:
o Approvals, Certificates, Consents,
Determinations, Notices, Requests
• Official In Writing
• Delivered
• No-unreasonably withheld or delayed
• Number of Copies
to think?
2223 July 2017

Outlines- the Engineer
How to think?
2323 July 2017

Q&A
SS FIDIC Training 1011 BTA - Dr. Moustafa
Ismail July 2017 LEC- I How to think?
24
Q1. FIDIC Conditions of Contract for Construction
1. Red. Book 2-White Book
Q.2 In the Red Book the Works is designed by Employer
or Engineer
1. TRUE 2-False
Q.3 FIDIC Red Book Employer's Claims Clause 2.5
1-TRUE 2-False
Q.4 Contractor‟s Claims Clause .20.1
1-TRUE 2-False
Q.5 FIDIC Conditions of Contract for Plant
& Design Build “Electrical & Mechanical Plant”
1- (Y Book) 2-False 23 July 2017

Q&A
SS FIDIC Training 1011 BTA - Dr. Moustafa
Ismail July 2017 LEC- I How to think?
25
Q1. FIDIC Conditions of Contract for Construction
1. Red. Book 2-White Book
Q.2 In the Red Book the Works is designed by Employer
or Engineer
1. TRUE 2-False
Q.3 FIDIC Red Book Employer's Claims Clause 2.5
1-TRUE 2-False
Q.4 Contractor’s Claims Clause .20.1
1-TRUE 2-False
Q.5 FIDIC Conditions of Contract for Plant
& Design Build “Electrical & Mechanical Plant”
1- (Y.Book) 2-False 23 July 2017

General provisions: 1.1 Definitions- 65w
think?
2623 July 2017
1. Abu Dief, M. (2017) Applied Management for FIDIC Contracts, Part One:
Segregation of General Provisions , PM World Journal, Vol. VI, Issue VII – July
2017
Example: Engineer .. engineer

Interpretation
SS FIDIC Training 1011 BTA - Dr. Moustafa Ismail July 2017 LEC- I How to think? 2723 July 2017
MR : MRS
Work Works

Communication
Receiving Emails ?

Communication- continued
23 July 2017
Mutual agreement- confirm receipt-written communication, mail, receiving signature
Law and Language:
The applicable law and language of the parties‟
communication shall be identified in the contract
documents- appendix to tender- particular conditions.

Priority in contract documents
to think?
3023 July 2017

Contract Preparation
The Contractor submits the Letter of Tender LOT
 If accepted by The Employer
The Employer issues the Letter of Acceptance
 If received and accepted by the Contractor with the date D
Then: A binding Contractual relationship exists
 In 28 days from the date D the parties should sign a
Contract Agreement as per the form annexed to the
Particular conditions
LOA may Substitute the Contract Agreement--- missing LOA, then
Contract Agreement is mandatory

Establishing a contractual relationship
• Three possibilities to establish a contractual
relationship.
 Issue letter of acceptance “ LOA”
 Signing an agreement with or without “LOA”
 Signing of a formal comprehensive „ Contract
‟ document which would include the Contract
Agreement.
23 July 2017

Assignment
„ Neither Party is permitted to assign or transfer the
whole or any part of the Contract or any benefit or
interest in or under the Contract without the
agreement of the other Party. ’ Exceptionally either
Party may, as security, assign its right to any
money due under the Contract to a bank or
financial institution.
23 July 2017

Care of project documents
think?
34
• The Employer is required to provide to the Contractor
two copies of the Contract & drawings.
• The Contractor has to supply 6 copies of the Contractor‟ s
Documents to the Engineer/including submittal/ approval
• The Contractor should seek clarification from the
Engineer if a 6 copies is required at the submittal - for -
approval stage or only required once the documents are
approved.
23 July 2017

Delayed Drawings and Instructions
• The Contractor is required to give notice to the
Engineer whenever „ the Works are likely to be
delayed or disrupted ‟ due to delay in
Drawings/instructions
• The Contractor is further required to provide
details of „ how, when and why ‟ the drawings
or other instructions are needed. This has a
direct relationship to the preparation of
programs (Sub - Clause 8.3 refers).
23 July 2017

Case Study (1)
think?
3623 July 2017

Case Study (1) Analyzed by: Eng. …………………………….
think?
3723 July 2017
In the shown part of Contract Agreement, as per FIDIC
general conditions requirements discuss:
The Project name and location is identified in order to:
……………………………………………………………….
The Contract parties names and addresses are necessary as
per FIDIC Red Book 1999 Clause/s:
……………………………………………………………………
The Contract Date shall affect the following:
1- Date of submission of performance security
2- Date of project completion
…………………………………………………………………
To identify the Contract Cause and place of work/ applicable Law

to think?
38
END OF LECTUTRE ONE
Thank you
‫هللا‬ ‫أمان‬ ‫فى‬
23 July 2017

Ss training fidic moustafa ismail 2017 _ lec. 1

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