Major Differences between (FIDIC-JCT-NEC).pdf

Major Differences between (FIDIC-JCT-NEC)

Comparison Items
FIDIC-JCT-NEC Differences:
1- Structure and Drafting
2- Pricing and Scope
3- Admin. and Instructions
4- Quality and Inspection
5- Payment Process
6- Programme
7- Claim and Variation
8- Dispute Resolution
_________________
• American example (AIA 2017)
ppmconference.net @Prof.Planner ArabPlanners @magedkom

Instructor: Engineer/ Mohamed Maged
PgMO - Project Control Manager, MBA, B.Sc. of Civil engineering, with
experience in MENA region of (construction, infrastructure, and roads) Mega
projects, in professions of Contract administration, Procurement, Tender estimating,
Cost control, Planning & Claim analysis.
Certificates & Memberships:
MBA, PGCERT, CCP, PMP, ACIArb, AIA Fellow, SCE-PE, FIDIC Contracts Consultant
M.M. Organized four Annual Conferences of Planning and Project Management (Anniversary of
Facebook Page: Prof.Planner)- American University in Cairo, 2014, 2015 & Online 2017, 2019.
SlideShare: www.slideshare.net/MohamedMaged8/
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(related groups: Best Advice for Planners/ Cost/ Contract – Public groups)

National Construction Contracts and Law Report 2018
National Building Specification, UK

1- Structure and Drafting
General conditions in 21 Clauses with
Sub-Clauses, then the Particular
conditions which consists of Contract
data and Special provisions.
Many clauses are incorporate by
reference to the main ones of
procedures such as Variation.
FIDIC uses Shall and May.
FIDIC
“Agreement” including recitals,
articles, contract particulars, and
attestation. Then the “Conditions” in 9
Sections, and finally “Schedules”.
Most of the clauses incorporate other
related ones by reference.
JCT uses Shall and May.
JCT
“Core Clauses”, a dispute resolution
option W and secondary options X-Y.
Finally, the cost components and
contract data. Z clause for amendment.
Written using straightforward/ simple
English.
NEC uses Does and May.
NEC

NEC
New Engineering Contracts (NEC)
came to the fore by (ICE) in the
1990’s alongside two UK
Government Reports being
Commissioned:
First by Sir Michael Latham
(Constructing the Team) in 1994,
and thereafter by Sir John Egan
(Rethinking Construction) in 1998.
FIDIC
In 1913, a number of consulting
engineers met in a fair which led to
the formal constitution of FIDIC,
Fédération Internationale des
Ingénieurs Conseils, or later, the
International Federation of
Consulting Engineers.
JCT
In 1931, the Joint Contracts
Tribunal (JCT) was formed by the
Royal Institute of British Architects
(RIBA).

2- Pricing and Scope
The Red book is Re-measure & design
by Employer, while yellow book is LS
& design-build. There are also suites
for BOT, consultancy & dredging.
FIDIC
The price can be LS or Measurement
based on bill of quantity “BOQ” or
Cost reimbursement according to the
standard form used.
JCT
The same options of LS, BOQ, and
Cost-reimbursable are there with
adding Options C & D - Target cost
where parties share pain and gain.
NEC
The scope is defined as “Works”
described in the specification,
drawings, and schedules/ BOQ. The
sum of works to be stated in the Letter
of tender and accepted in the Letter of
acceptance as Accepted Contract
Amount. Also, the provisional sum is
allowed in Sub-Clause 13.4.
The scope is defined as “Works”,
described under “Recitals” in the
“Agreement” after defining the parties.
The contract sum is specified under
article 2 in the agreement. Also, the
provisional sum is allowed in contract
documents clause 3.16 and to be
valued as per clause 5.2(3).
Scope and site information are defined
in clauses 11.2(16)&(18) which are
described in contract data part 1
provided by the client. Where the
activity schedule in Option C is only
for pricing and it does not represent
Scope or Site Information as stated in
clause 55.2.

FIDIC Form Selection

NEC4 Engineering and Construction
Contract (ECC)
• Option A: Priced contract with
activity schedule
• Option B: Priced contract with bill of
quantities
• Option C: Target contract with
activity schedule
• Option D: Target contract with bill of
quantities
• Option E: Cost reimbursable contract
…………

JCT 2016
Traditional or conventional: Measurement
• Standard Building Contract With Approximate Quantities (SBC/AQ)
• Measured Term Contract (MTC)
Traditional or conventional: Cost reimbursement or cost plus
• Prime Cost Building Contract (PCC)
Design and build
• Major Project Construction Contract (MP)
• Design and Build Contract (DB)
…………..

3- Admin. and Instructions
The Employer appoints an Engineer
who administers the contract (3.1).
The Engineer may issue instructions
necessary for the Works or Variation.
FIDIC
The Employer assigns an Architect/
Contract Administrator to administer
the contract (3.5). CA may issue
Instructions or Variation.
JCT
The Client assigns a Project Manager
“PM” to administer the contract
(clause 14). PM may give instructions
or notify Compensation Events.
NEC
Notices and other communications
shall be in writing (1.3).
Instructions are allowed orally in case
of emergency (1.7.5) or otherwise than
in writing (3.12) but these shall be
confirmed in writing.
Verbal instructions are not mentioned
but all communications to be in a form
which can be read, copied and
recorded (13.1).

Administration Role
Costain Ltd v Bechtel Ltd (2005)
Mr Justice Jackson emphasized that the CA is obliged to act impartially: “it was
the project management consortium's duty to act impartially as between employer
and contractor otherwise it is a breach of its duty”.

4- Quality and Inspection
The Engineer is responsible for
supervision (Inspection (7.3)),
appoints representative and delegates
(3.3 & 3.4).
FIDIC
The Employer appoints a clerk of
works to act as an inspector under the
CA directions (3.4).
JCT
The Client assigns a Supervisor to do
tests and inspections or notify the
contractor of defects in order to
correct them.
NEC

5- Payment Process
Payments are under Clause 14 Contract
Price and Payment. The Contractor
submits a statement then the Engineer
issues Interim Payment Certificate
“IPC” and the Employer makes the
payment with reference to the date of
the statement submission except for the
final statement, it is 56 days from the
FPC after the Performance Certificate.
- The Engineer does the measurement
and valuation pursuant to Clause 12.
FIDIC
The payment process is managed
under section 4. The payment cycle is
monthly, and the due dates are referred
to the later of interim valuation date or
receipt of the interim payment
application. These dates are for
payment notice, payless notice, final
payment, and the final date for
payment following UK Acts.
- The valuation shall be done by QS,
and CA issues the payment certificate
stating the calculation basis (4.9).
JCT
The payment process (section 5) is
mainly based on defining the
assessment dates to determine the due
dates for application for payment,
assessment/ correction, final
assessment, and payment. PM decides
the first one then the recurring would
be based on the interval stipulated.
- For Option C, the contractor is
reimbursed for the PWDD which
equals to “Defined Costs” plus fee
minus any “Disallowed Costs”.
NEC

Payment
in FIDIC
Within 56 days after issue of
“Performance Certificate”
4.11.2 Contractor submits
Final Statement or “Partially
Agreed Final Statement” and
the 14.12 discharge

JCT & NEC
NEC:
Assessment
Date
UK Construction ACT
96/2009: Scheme for
Construction Contracts
(England and Wales)
Regulations 1998
(Amendment – 2011)

Grove Developments Ltd v Balfour Beatty Regional Construction Ltd 2016
The parties' contract was a JCT standard design and build contract amended by a series of amendments. The parties
amended that by agreeing a schedule of 23 valuation and payment dates covering the period from September 2013
to July 2015. The contract specified a completion date of 22 July 2015.
The works were not completed by that date. In August 2015 the contractor issued an application for a further
interim payment. The developer asserted that the contractor had no further entitlement to interim payments.
The issues were whether the contractor was able to recover interim payments after the contractual completion date
under the Housing Grants, Construction and Regeneration Act 1996 s.109, which provided that a party was entitled
to interim payments for "any work" under a construction contract, and the Scheme for Construction Contracts.
Court agreed with Grove that BB (Contractor) had no contractual right for an Interim Application for
Payment. The parties had entered into a contract, and just because that contract didn’t cover all payment
eventualities didn’t mean the Scheme should come into force.
Interim Payments

6- Programme
The main dates under contract are:
Base date, Delivery of Performance
Security, Commencement Date, Date
of Completion, Defects Notification
Period, Performance Certificate.
FIDIC
Base date, date/s of possession,
completion date (Practical
completion), Rectification period up to
Certificate of making good.
JCT
Starting date, access dates, Completion
date, Defect correction period up to
Defects date.
NEC
The Contractor shall submit an initial
programme under Sub-Clause 8.3
within 28 days after the
Commencement Notice (8.1) or a
revised after 14 days from the
Engineer Notice.
The Contractor provides a master
programme under clause 2.9.1.2 and
the Contractor provides amendment or
revision within 14 days from CA
decision (2.28.1) without imposing
any obligation beyond the contract.
The programme (section 3: time) is in
the heart of the contract as it should be
revised on a regular basis.
- The delay in submitting the first
programme allows the PM to retain
25% of the PWDD (50.5).

7- Claim and Variation
Advance warning added in 8.4 while
claims and variation are managed
under Clauses 20 & 13. However, the
causes that entitle to EOT are included
in Sub-Clause 8.5 EOT for
Completion.
FIDIC
The claims for time are under
Relevant Events (2.29) while the
claims for cost are under Relevant
Matters (4.22). However, the adverse
weather is included only as a relevant
event, not relevant matter.
JCT
EW (clause 15) is a tool that parties
use to notify the potential changes/
CEs.
NEC
The Valuation is under Sub-Clause
13.3 and the Engineer determination is
under Sub-Clause 3.7 Agreement or
Determination.
The valuation rules depend on whether
measurable work (5.6) or contractor’s
designed portion (5.8), otherwise
dayworks apply (5.7).
Claims for cost or/and time are under
compensation events (section 6). The
Contractor submits quotations which
comprise changes to prices and/or
alterations to the accepted programme
(62.2), then PM replies (62.3).

Request for
Proposal
13.3.3
Contractor’s
Proposal
13.2
DAAB
21.4
FIDIC Phases of Variation/ Claim
Engineer’s
Instruction
13.3.1
Parties’ Agreement or
Engineer’s Determination
3.7 – 12.3
Arbitration
21.5-21.6
Claim
20

Relevant Event
Relevant Matter
JCT Types of Events
2.27 Notice by Contractor of delay to progress
2.28 Fixing Completion Date
1. If, .. on receiving a notice .. under clause 2.27: :
.1 any of the events which are stated to be a cause of delay is a
Relevant Event; and
.2 completion of the Works or of any Section is likely to be
delayed thereby beyond the relevant Completion Date,
then, .. Architect/Contract Administrator shall give an extension
of time by fixing such later date as the Completion Date for the
Works or Section as he then estimates to be fair and reasonable.
2.29 Relevant Events
Loss and Expense
4.20 to 4.24
4.22 Relevant Matters
The following are the Relevant Matters:
.1 Variations (..including any .. matters or instructions which under
these Conditions are to be treated as a Variation);
.2 Architect/Contract Administrator’s instructions: …
.4 any impediment, prevention or default, whether by act or
omission, by the Employer, the Architect/Contract Administrator, the
Quantity Surveyor or any Employer’s Person,..
4.23 Amounts ascertained – addition to Contract Sum

NEC
Flowchart of
Compensation
Events

8- Dispute Resolution
Clause 21 Dispute and Arbitration.
Normally the dispute starts from 3.7
or referred to DAAB directly. If no
agreement under 3.7.1 the Engineer
makes notice of determination 3.7.2.
In case of dissatisfaction 3.7.5, parties
obtain DAAB’s Decision 21.4, finally
Amicable settlement 21.5 and
Arbitration (ICC) 21.6.
FIDIC
Section 9 is settlement of disputes
starting with mediation in case of not
resolved by negotiation then
adjudication and after that arbitration
in accordance with the JCT 2016
edition of the Construction Industry
Model Arbitration Rules (CIMAR)
applying UK Arbitration Act 1996.
JCT
There are three W options to comply
with the international use. Whereas,
options W1 and W2 refer to
adjudication but W2 applies The UK
Housing Grants, Construction and
Regeneration Act 1996 while option
W3 uses the dispute avoidance board
and finally tribunal/ arbitration.
NEC

21.5 Amicable Settlement
Where a NOD has been given under Sub-Clause 21.4 [Obtaining DAAB’s Decision], both
Parties shall attempt to settle the Dispute amicably before the commencement of
arbitration. However, unless both Parties agree otherwise, arbitration may be
commenced on or after the twenty-eighth (28th) day after the day on which this NOD
was given, even if no attempt at amicable settlement has been made.
FIDIC: Optional Amicable Settlement
DAAB Decision
Engineer Determination
Arbitration

NEC Adjudication Option W1 vs DAB W3
JCT & NEC Adjudication (W2) Dispute Avoidance Board (W3)
- JCT starts with Mediation but NEC refers disputes
first to the Senior Representatives.
- A party issues a notice of adjudication (Adjudicator
acts impartially) for any issue not agreed to refer this
dispute to adjudicator, and finally tribunal which can
be arbitration.
- A party doesn’t refer to the tribunal unless it has
been referred to the Adjudicator, via a notification to
be given within 4 weeks of the Adjudicator’s
decision, otherwise it becomes final and binding.
- The DAB assists the parties in resolving disputes
before they become disputes.
- The DAB acts impartially.
- The DAB visits the Site and inspects the work,
reviews all potential disputes without the need to be
formally referred.
- A party doesn’t refer to the tribunal unless it has
been referred to the DAB within four weeks from the
DAB’s recommendation.

The American example (AIA 2017)
There is no standard form of construction agreement in the
United States but the A-201 General Conditions and other
forms published by the American Institute of Architects (AIA)
are probably the most widely used in local government projects
and private construction.
Federal construction projects are generally governed by the
Federal Acquisition Regulation (FAR), a book containing
numerous clauses mandated on various types of jobs.
There are other well-known suites of contract forms which
are published by ConsensusDocs, the Engineers Joint
Contract Documents Committee (EJCDC)/ ASCE and the
Design Build Institute of America (DBIA).

Standard Form of Agreement Between Owner and Contractor where the basis
of payment is a Stipulated Sum
ARTICLE 9 ENUMERATION OF CONTRACT DOCUMENTS
§ 9.1 This Agreement is comprised of the following documents:
.1 AIA Document A101™–2017, Standard Form of Agreement Between Owner and Contractor
.2 AIA Document A101™–2017, Exhibit A, Insurance and Bonds
.3 AIA Document A201™–2017, General Conditions of the Contract for Construction
.4 …..

General Conditions of the Contract for Construction
- Tenderers
- Sections - Clauses
- Employer / Client - Architect/CA / PM
- Practical Completion/ Defects date
- Programme
- Relevant Matter / Compensation Event
- Senior Rep.s / Mediation – Adjudication/DAB – Tribunal
UK Forms (JCT & NEC)
- Bidders
- Articles
- Owner - Architect
- Substantial Completion/ Final Completion
- Construction Schedule
- Change Order
- Initial Decision - Mediation – Arbitration (AAA)
AIA- Document A201

Two commonly occurring categories of scope
changes on construction projects are either:
changes directed by the owner, or changes
identified by the contractor as a result of an
action or inaction of the owner, also known as
constructive changes (causes claims).
An owner-directed change may ultimately
become a constructive change (claim) if the
contractor believes it will be impacted by the
directed change.
Change Order

Related Lectures and Courses
Course at Luqman Academy YouTube Lectures
32

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‫حديثا‬
33
‫تشرح‬ ‫العقود‬ ‫إدارة‬ ‫في‬ ‫متكاملة‬ ‫دورة‬
‫والعقود‬ ‫العطاءات‬ ‫وأنواع‬ ‫مراحل‬
‫مع‬
‫االستدالل‬
‫من‬ ‫وأمثلة‬ ‫المدني‬ ‫بالقانون‬
‫األنظمة‬ ‫وبعض‬ ‫البريطاني‬ ‫العام‬ ‫القانون‬
‫م‬ ‫وكذلك‬ ‫واألمريكية‬ ‫والبريطانية‬ ‫العربية‬
‫ع‬
‫النموذجية‬ ‫العقود‬ ‫صيغ‬ ‫بعض‬ ‫استخدام‬
.

Thank You
Don’t Hesitate to contact….
M.Maged
magedkom@gmail.com
mobile : 00966-580264968

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