UMES International Construction Contracts Essay

Please read the article “Contract Administration Guidelines for U.S. Contractors Working under World Bank–Funded Projects” and answer the following questions:

Assignment- International Construction Contracts
Please read the article “Contract Administration Guidelines for U.S. Contractors Working
under World Bank–Funded Projects” and answer the following questions:
1. What is the main purpose of the paper?
2. Why US contractors who are familiar with AIA 201 contract forms may have a different
perspective when it comes to the role of Engineer?
3. What is the difference between FIDIC and the World Banks Contract with regard to the role
of Bank?
4. Are oral instructions acceptable in FIDIC and World Bank Contracts? Are oral approvals
accepted?
5. What is the timeline of procedure for Extension of Time (EOT) in FIDIC contracts? What if
the Engineer fails to determine EOT according to the timeline?
6. What is the timeline for submission of progress payment? What if the Engineer delayed in
issuing the interim payment certificate?
7. What can a contractor do if payments are delayed?
Follow the rubric for above assignment as below:
1. Introduction is comprehensive, gives reader good direction, ‘sets the scene’, and is followed
throughout paper.
2. Summary/conclusion is thoughtful and relevant.
3. Fundamental issues addressed in depth with original arguments and critical judgements,
demonstrating insight and creativity.
4. Current and classic primary literature sources are utilized.
5. Writing style shows evidence of individuality, unity and fluency.
6. Overall presentation of the paper is professional with no errors in syntax, spelling, etc. (i.e.
Proper English language usage), and follows APA format
Add the APA format references at the end of your paper.
Scholarly Paper
Contract Administration Guidelines for U.S. Contractors
Working under World Bank–Funded Projects
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Salwa A. Fawzy1 and Islam H. El-adaway2
Abstract: Today’s globalized construction industry requires more integration and collaboration between various multinational and multicultural stakeholders. Many U.S. contractors are involved in large-scale projects that are funded in whole or in part by the World Bank. These
projects are managed through the Standard Bidding Documents for Procurement of Works (SBDW). The Conditions of Contract included in
the SBDW (i.e., WB contract) are based extensively on the Conditions of Contract for Construction published by the International Federation
of Consulting Engineers (FIDIC). Most of the U.S. contractors are more familiar with the families of contracts issued by the American
Institute of Architects Conditions of Contract (namely, the A201) and are less familiar with the FIDIC Conditions of Contract. This paper
presents contract administration guidelines for U.S. contractors working under World Bank–funded projects. The authors highlight the WB
contract’s fundamental administrative issues, including the role of the Bank, the responsibilities of the engineer, commencement, instructions,
approvals, delays and extension of time, acceleration, and payment provisions. For each guideline, the authors compare the associated SBDW
provisions with their respective ones under the FIDIC’s editions issued in 1987 and 1999. It is perceived that such in-depth analysis will help
U.S. contractors better understand the evolution of the philosophy governing the development of SBDW contracts and consequently help
them better manage their associated projects. DOI: 10.1061/(ASCE)LA.1943-4170.0000088. © 2012 American Society of Civil Engineers.
CE Database subject headings: Contractors; Contract management; International factors; Construction industry.
Author keywords: World Bank; FIDIC; Contract administration; Management; Commencement; Instructions; Approvals; Delays;
Extension of time; Acceleration; Payment.
Introduction
The World Bank was created at the Bretton Woods Conference,
New Hampshire, in 1944. It was established to carry out the
reconstruction works in Europe after World War II. Later, its mission was changed to reduce poverty through funding various infrastructure projects in developing countries. Currently, the World
Bank is based in Washington, D.C. and has 187 member countries.
The World Bank provides over $24 billion for activities in developing countries every year (World Bank 2010a). The World Bank
Group comprises five institutions: the International Bank for
Reconstruction and Development (IBRD), the International Development Association (IDA), the International Finance Corporation
(IFC), Multilateral Investment Guarantee Agency (MIGA), and
the International Center for Settlement of Investment Disputes
(ICSID). The first two institutions, IBRD and IDA, work primarily
with governments and their work is complemented by the other
three agencies to provide low-interest loans, interest-free credit,
and grants to developing countries for a wide range of purposes
that include investments in education, health, public administration,
and infrastructure (World Bank 2010a).
1
Contracts Manager, Dar El Mimar Group, Cairo, Egypt. E-mail: salwa
.fawzy@corp-dmg.com
2
Assistant Professor, Dept. of Civil and Environmental Engineering,
Mississippi State Univ., 501 Hardy Road, 235C Walker Engineering Building, P.O. Box 9546, Mississippi State, MS 39762 (corresponding author).
E-mail: eladaway@cee.msstate.edu
Note. This manuscript was submitted on August 26, 2011; approved on
October 4, 2011; published online on October 7, 2011. Discussion period
open until October 1, 2012; separate discussions must be submitted for individual papers. This paper is part of the Journal of Legal Affairs and
Dispute Resolution in Engineering and Construction, Vol. 4, No. 2,
May 1, 2012. ©ASCE, ISSN 1943-4162/2012/2-40–50/$25.00.
In May 2005, the World Bank prepared the Standard Bidding
Documents for Procurement of Works (SBDW) in projects funded
in whole or in part by the World Bank. The SBDW are based on the
Master Bidding Documents for Procurement of Works and User’s
Guide adopted by the Multilateral Development Banks (MDBs)
and International Financing Institutions. The Conditions of Contract included in the SBDW are based extensively on the Conditions
of Contract for Construction published by the FIDIC in 1999. Typically, the SBDW accounts for the great number of deviations from
the said Conditions of Contract using a harmonized version of contract conditions introduced under Section VII, General Conditions.
The text of the harmonized version has been agreed upon by the
International Federation of Consulting Engineers (FIDIC) and various MDBs for its inclusion in the Master Procurement Documents
for Procurement of Works & User’s Guide (World Bank 2007,
2010b). In this paper, the harmonized General Conditions
included in the SBDW are referred to as the WB contract.
The FIDIC was originally founded in 1913 by three national
associations of consulting engineers in Europe. Generally, the
FIDIC forms of contract have been developed in order to provide efficient provisions, to build on the experience gained from
the repeated use of the standard forms, and to minimize the financial provision for unfamiliar contract provisions (Bunni 2005;
Booen 2000).
The first edition for the standard conditions of contract for
works of civil engineering construction especially designed for use
in international projects was published in August 1957. This became known as the Red Book because its cover was printed in red.
The second edition was published in 1963 and the third in 1977.
Later, the fourth edition of the Conditions of Contract for Works of
Civil Engineering Construction was published for the Annual Conference of FIDIC held in Lausanne, Switzerland, in September of
1987 (Bunni 2005; Civil Engineering Contracts Committee 1989).
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Major revisions and modifications were made; even the word
“international” was deleted from the title of the document, hence,
the document was subsequently used in domestic contracts as well
as international ones (Bunni 2005). The fourth edition was reprinted in 1988 with editorial amendments, and was subsequently
reprinted in 1992 with further amendments. In 1999, the FIDIC
published the new suite of standard contracts. The new suite included the Conditions of Contract for Construction, which is recommended for building and engineering works designed by or on
behalf of the employer, although some elements of design may be
given to the contractor. Another important element is the appointment of the engineer to supervise the works, certify payment, and
monitor the quality of the works (Caldwell 2009). Revisions have
been made to the standard forms with the aim of attaining greater
certainty in the intention of the wording and/or of responding to the
needs of the parties (Bunni 2005).
U.S. contractors are mostly familiar with contracts issued by the
American Institute of Architects (AIA), namely, A201. The AIA
A201 family of documents is designated to deal with this delivery
method and is based on the premise that legal relationships on
a construction project comprise two-party contractual arrangements (American Institute of Architects 2009). There are the
owner–contractor contract, owner–architect contract, contractor–
subcontractor contracts, and so forth. There is no direct contractual relationship between the architect and the contractor or
the architect and the subcontractor or any two stakeholders who
are not bound with a contract agreement. Despite all good faith
attempts in relation to coordinating efforts during project activities,
this environment instills a major obstacle toward effective and
efficient communication and collaboration (El-adaway 2010a, b).
Typically, the AIA A201 includes provisions regarding definitions,
administration procedures, rights and responsibilities of the owner,
duties and authorities of the design professional (architect or engineer), rights and responsibilities of contractor, subcontractor participation, time, payments and completion, changes in the scope
of work, protection of persons and property, insurance and bonds,
disputes, termination of the contract, and safety (American Institute
of Architects 2007, 2009).
Goals and Objectives
This paper aims to provide contract administration guidelines for
U.S. contractors working under World Bank–funded projects. It
would be impractical, if not impossible, to include all contract
administration guidelines under this study. Hence, the authors
focused on the contractual provisions that are essential for effective
and efficient operation of U.S. contractors under World Bank–
funded projects. For each provision, the authors (1) highlight fundamental elements of the WB contract in such a manner so as to
respond to the concerns related to the administration of the contract
and to clarify issues related to the risk allocation among the employer and the contractor, and (2) provide a comparative analysis
of such contractual provisions with their respective ones under the
FIDIC’s conditions of contract for construction issued in 1987
and 1999.
Guidelines Development
Role of the Bank
Naturally, the term bank does not exist in the FIDIC 4th (Conditions
of Contract for Works of Civil Engineering Construction 1987) nor
FIDIC 99 (Conditions of Contract for Construction 1999). It was included in the WB Contract. According to subclause 1.1.2.11, bank is
defined as “the financing institution (if any) named in the Contract
Data.” Subclause 1.15 (Inspections and Audit by the Bank) states that
“The Contractor shall permit…the Bank and/or persons appointed by
the Bank to inspect the Site and all accounts and records relating to
the performance of the Contract and the submission of the bid, and to
have such accounts and records audited by auditors appointed by the
Bank if requested by the Bank.” Hence, the bank shall have inspection
and audit powers. This role is not only an active one but also an intrusive role (Caldwell 2009). The importance of this role is very significant and was further confirmed by the assertion made in subclause
15.6 (Corrupt or Fraudulent Practices) in which acts intended to
materially impede the exercise of the inspection and audit rights constitute a prohibited practice, defined in this subclause as “obstructive
practice.” Such practice could result in contract termination. Another
role of the bank is illustrated in subclause 4.1 (Contractor’s General
Obligations), which states that “All equipment, material, and services
to be incorporated in or required for the Works shall have their origin
in any eligible source country as defined by the Bank.” Thus, the bank
also has a significant role in establishing the origin of all equipment,
material and services, yet it should be noted that the bank’s definition
of the eligibility criteria is not provided (Caldwell 2009).
Responsibilities of the Engineer
It is of utmost important for U.S. contractors to understand the
responsibilities of the engineer under the WB contract, because
although the engineer is not a party to the contract, the engineer
is empowered to give instructions, make decisions, determinations,
or variations that are binding on the employer and the contractor.
This was asserted by Bunni (2005) for the FIDIC 4th and the authors confirm that such assertion applies to the WB contract and
FIDIC 99. Under the WB contract, FIDIC 99, and FIDIC 4th,
the employer hires the engineer to act as a supervisor to the works,
an administrator, and a certifier. Under the FIDIC 4th, the engineer
also acts as an adjudicator or quasi-arbitrator.
Subclause 3.1 (Engineer’s Duties and Authority) states that,
“The Employer shall promptly inform the Contractor of any change
to the authority attributed to the Engineer.” According to Caldwell
(2009), it is disappointing that the above provision replaces the following provision in the FIDIC 99: “The Employer undertakes not
to impose further constraints on the Engineer’s authority, except as
agreed with the Contractor.” The engineer’s role and authority is
very significant to the contract and any changes thereto could inevitably affect the contractor. The same subclause of both the WB contract and the FIDIC 99 states that “If the Engineer is required to
obtain the approval of the Employer before exercising a specified
authority, the requirements shall be as stated in the Particular Conditions.” Yet it is of extreme importance to note that according to
the WB contract, the engineer must seek the approval of the employer before taking action under the following conditions:
1. Agreeing or determining an extension of time and/or additional cost if the contractor encounters unforeseeable physical
conditions;
2. Instructing a variation, except in emergencies or if the variation
shall not exceed an amount as specified in the contract data;
3. Approving a proposal for variation submitted by the contractor; and
4. Specifying the amount payable in each of the applicable
currencies.
Notwithstanding the above provision, under the same subclause 3.1 of both the WB contract and the FIDIC 99, “whenever
the Engineer exercises a specified authority for which the Employer’s approval is required, then (for the purposes of the Contract) the
Employer shall be deemed to have given approval.” Hence, when
the contractor receives a determination from the engineer for
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which the employer’s prior approval was required, the employer
is deemed to have given approval and thus the contractor is
not entitled to query whether such prior approval was given
(Booen 2000).
Under subclause 3.1 of both the WB contract and the FIDIC 99,
“whenever carrying out duties or exercising authority, specified in
or implied by the Contract, the Engineer shall be deemed to act for
the Employer.” According to Booen (2000), the role of the engineer
is thus not stated to be of a wholly impartial nature. The authors
assert that this represents a major deviation from the FIDIC 4th,
which expressly states in subclause 2.6 (Engineer to Act Impartially) that “Wherever, under the Contract, the Engineer is required
to exercise his discretion…he shall exercise such discretion impartially within the terms of the Contract….”
Under the WB contract and FIDIC 99, the engineer does not act
as an adjudicator or quasi-arbitrator. Yet, the engineer shall make
determinations in accordance with subclause 3.5 (Determinations).
This is an interesting change that was made from the FIDIC 4th,
which provided for the role of the engineer as an adjudicator or
quasi-arbitrator, as embodied in subclause 67.1 (Engineer’s Decision), which asserts that any dispute may be referred to the engineer
for his decision and such reference is a condition precedent to
arbitration (Bunni 2005).
Commencement
One important provision that U.S. contractors should grasp is the
provision for commencement, because many disputes arise from
the misunderstanding of what actually constitutes the commencement of the works and consequently the time for completion. An
interesting change was made to the provisions triggering the commencement date under the WB contract, from the equivalent provisions under the FIDIC 99. According to subclause 8.1 of the WB
contract (Commencement of Works):
the Commencement Date shall be the date at which the following precedent conditions have all been fulfilled and the
Engineer’s instruction recording the agreement of both Parties
on such fulfilment and instructing to commence the Works is
received by the Contractor:
1. Signature of the Contract Agreement by both Parties, and if required, approval of the Contract by relevant authorities in the
Country;
2. Delivery to the Contractor of reasonable evidence of the
Employer’s Financial arrangements [under Sub-Clause 2.4
(Employer’s Financial Arrangements)];
3. Except if otherwise specified in the Contract Data, possession of
the Site given to the Contractor together with such permission(s)
under (a) of Sub-Clause 1.13 (Compliance with Laws) as required for the commencement of the Works; and
4. Receipt by the Contractor of the Advance Payment under SubClause 14.2 (Advance Payment) provided that the corresponding bank guarantee has been delivered by the Contractor… The
Contractor shall commence the execution of the Works as soon
as is reasonably practicable after the Commencement Date….
The authors assert that this is a major deviation from the FIDIC
4th and the FIDIC 99. Under the FIDIC 4th, the commencement
date is the date upon which the contractor receives the notice to
commence pursuant to clause 41 (Commencement and Delays).
The notice to commence is to be issued within a time period
after the letter of acceptance. Such time period is to be stated in
the Appendix to Tender.
The contractor shall then commence as soon as reasonably possible after the notice to commence. No specific period is stated.
Although this paper does not cover provisions from the FIDIC
editions earlier than those issued in 1987, it is worth pointing
out that the above provision is a transition from the FIDIC third
edition, where a period is specified in the Appendix to Tender
for the contractor to commence. The FIDIC 99 follows a slightly
different logic. The commencement date is the date notified under
sub-clause 8.1 (Commencement of Works), compared to the date of
receipt of the notice as per the FIDIC 4th. Such commencement
date shall be within 42 days after the contractor receives the letter
of acceptance, not within a period stated in the Appendix to Tender,
as per the FIDIC 4th. Furthermore, the engineer must give the
contractor not less than 7 days’ notice of the commencement date.
Similar to the WB contract and the FIDIC 4th, the contractor shall
commence as soon as reasonably practicable after the commencement date and no specific period is stated.
Engineer’s Delayed Notice to Commence
According to subclause 8.1 of the WB contract (Commencement of
Works) “…(e) If the said Engineer’s instruction is not received by
the Contractor within 180 days from his receipt of the Letter of
Acceptance, the Contractor shall be entitled to terminate the Contract under Sub-Clause 16.2 (Termination by Contractor).” The
above express provision was added to the WB contract and is
absent in both FIDIC editions. However, it is crucial for the engineer, in both FIDIC editions, to follow the period set to notify the
contractor of the commencement date. Otherwise, this would result
in damages to the contractor, to which he shall be entitled
reimbursement.
Contractor’s Failure to Commence
If the contractor fails to commence without reasonable excuse in
accordance with clause 8 (Commencement, Delays and Suspension) of the WB contract, this would entitle the employer to terminate the employment of the contractor pursuant to subclause 15.2
(Termination by Employer). The FIDIC 4th and FIDIC 99 tackle
this issue in a similar way in subclauses 63.1 (Default of Contractor) and 15.2 (Termination by Employer), respectively. According
to (Bunni 2005), “[this] could result in a claim for breach of contract as well as for the remedies specified in subclause 63.2.” Subclause 63.2 covers the valuation at the date of termination.
Although Bunni’s earlier statement was addressing the provision
in the FIDIC 4th, it still applies to both the WB contract and
the FIDIC 99.
Instructions
U.S. contractors should note that compliance with instructions
given by the engineer is crucial for the completion of the works,
without incurring unnecessary additional costs to which the contractor shall not be entitled reimbursement. Thus, the authors are
highlighting the following provisions related to compliance with
instructions.
Oral Instructions
According to subclause 3.3 of the WB contract and FIDIC 99
(Instructions of the Engineer), “The Contractor shall comply with
the instructions given by the Engineer or delegated assistant on any
matter related to the Contract. Whenever practicable, their instructions shall be given in writing.” It should be noted that, according to
the same subclause, if the engineer issues an oral instruction, the
contractor confirms such oral instruction in writing within two
working days after the instruction is issued and the engineer does
not issue a rejection and/or instruction in writing within two working days after receiving the confirmation, “the confirmation shall
constitute the written instruction of the Engineer” and the contractor shall have to comply with such instruction. Tracing the
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equivalent of such provisions in the FIDIC 4th leads us to
subclause 13.1 (Work to be in Accordance with Contract), which
puts similar obligations on the contractor, however, with longer
timescales for the confirmation and the rejection of oral instructions. In the FIDIC 4th, the 2-day duration for confirmation and
the same for rejection are replaced by a 7-day duration for each.
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Delayed Drawings and Instructions
If it is the contractor’s position that any delay by the engineer in
issuing a drawing or instruction might result in delay or disruption
to the works, the contractor should resort to subclause 1.9 of the
WB Contract and similarly in the FIDIC 99 (Delayed Drawings or
Instructions), which states that “The Contractor shall give notice to
the Engineer whenever the Works are likely to be delayed or disrupted if any necessary drawing or instruction is not issued to the
Contractor within a particular time, which shall be reasonable.” If
the engineer fails to issue the notified drawing or instruction within
a reasonable time, specified in the notice, and this results in a delay
and/or additional cost to the contractor, the contractor shall be entitled, subject to subclause 20.1 (Contractor’s Claims) to extension
of time and additional cost plus profit. The FIDIC 4th addresses the
above provision in a similar manner in subclauses 6.3 and 6.4 (Disruption of Progress) and (Delays and Cost of Delay of Drawings),
respectively, where in case it is the position of the contractor that
any further drawing or instruction is required to be given by the
engineer in order not to cause delay or disruption to the works,
the former should resort to subclause 6.3 of the FIDIC 4th (Disruption of Progress). The subclause requires the contractor, in such
case, to give a notice including details of the event and the resultant
delay or disruption expected. In case the engineer does not issue
such drawing or instruction within a reasonable time after the contractor has given appropriate notice, this is likely to raise entitlement to extension of time and payment of additional costs to
the contractor, pursuant to subclause 6.4 (Delays and Cost of Delay
of Drawings). The authors highlight that the WB contract and the
FIDIC 99 give the contractor an entitlement to reasonable profit, in
addition to the extension of time and additional costs. In the FIDIC
4th, the contractor would be only entitled to extension of time and
additional costs, with no profit. The authors stress that it is the obligation of the contractor, nevertheless, under the WB contract and
both editions of the FIDIC, to provide appropriate notices.
Approvals
On highlighting the provisions for approvals, the authors confirm
that U.S. contractors should recognize that approvals cannot be
granted orally. According to subclause 1.3 of the WB contract
(Communications), “Wherever these Conditions provide for the
giving or issuing of approvals, certificates, consents, determinations, notices, requests and discharges, these communications shall
be: (a) in writing….” This provision is based on almost exactly the
same provision in subclause 1.3 of the FIDIC 99. The only difference is that the WB contract adds discharges to the communications. Comparing subclause 1.5 of the FIDIC 4th (Notices,
Consents, Approvals, Certificates and Determinations) to the above
two subclauses, it is noted that the latter addresses the issue of
written approvals in a similar manner, by stating that “such notice,
consent, approval, certificate or determination shall be in writing.”
Timescale to Issue Approvals: “Reasonable Period”
Dilemma
Many contracts list timescales for the engineer to issue approvals. It
is crucial for the contractor to recognize such timescales, as they are
taken into consideration when the contractor plans the timing and
sequence of the works. It is of great importance to note that, under
the WB contract, there is no general timescale set for the approval
process. It rather should be granted within a reasonable period.
Subclause 1.3 of the WB contract and FIDIC 99 (Communications)
states that “Approvals, certificates, consents and determinations
shall not be unreasonably withheld or delayed.” Although no timescale is stated, the importance of the requirement of certain communication not to be unreasonably withheld or delayed and the
consequences of noncompliance therewith should not be underestimated (Booen 2000). Subclause 1.5 of FIDIC 4th (Communications) addresses the approvals in a similar manner to that of the WB
contract and the FIDIC 99, as it states that any “such consent, approval, certificate or determination shall not unreasonably be withheld or delayed.” Although such reasonable period is not defined in
the WB contract, FIDIC 99, or FIDIC 4th, the authors agree with
Knowles’s (2005) perception that a reasonable period for approval
will depend upon the circumstances surrounding the event. Such
circumstances could involve any time allowed in the program,
the contractor’s rate of progress, and the time for completion
(Knowles 2005).
On the other hand, subclause 3.1 of the WB contract further
adds a significant provision, in this context, which is absent in
the FIDIC 99 or the FIDIC 4th. Subclause 3.1 states that
“…(d) Any act by the Engineer in response to a Contractor’s request except otherwise expressly specified shall be notified in writing to the Contractor within 28 days of receipt.” Furthermore,
subclause 3.5 of the WB contract (Determinations), states that
“The Engineer shall give notice to both Parties of each agreement
or determination, with supporting particulars within 28 days from
the receipt of the corresponding claim or request except when
otherwise specified.”
A subsequent question would be, what if the engineer fails to
approve a document within a reasonable period, and as a result the
contractor was delayed in the execution of the works? In such
cases, the contractor shall be entitled to extension of time, subject
to the relevant provisions for extension of time, as shall be further
discussed in this paper.
Implications of Approvals
The authors maintain that according to subclause 3.1 of the WB
contract and FIDIC 99 (Engineer’s Duties and Authority), approvals shall not relieve the contractor from his responsibilities under
the contract. But what then would an approval by the engineer
imply? The approval granted by the engineer indicates that such
document, in general, appears to agree with the requirements
of the contract (Civil Engineering Contracts Committee 1989).
Comparing the above subclause with subclause 7.3 of FIDIC
4th (Responsibility Unaffected by Approval), the authors stress that
the latter narrows the scope of the above provision as it tackles
the case where the engineer grants approval to any document submitted by the contractor in relation to part of the permanent works
designed by the latter, such approval shall, similarly, not relieve
the contractor of any of the responsibilities he has under the
contract.
Delays and Extension of Time
The provisions for delays and extension of time usually vary from
one contract to the other. Hence, understanding such provisions is
very important for contractors in the U.S. to avoid any failure to
properly follow the procedures for extension of time. To this end,
one important provision in any contract is the provision for delays
and extension of time.
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Entitlement
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The WB contract lists the delay events that could possibly raise
entitlement to extension of time, under subclause 8.4, as follows:
1. “a Variation [unless an adjustment to the Time for Completion
has been agreed under Sub-Clause 13.3 (Variation Procedure)]
or other substantial change in the quantity of an item of work
included in the Contract,
2. a cause of delay giving an entitlement to extension of time under
a Sub-Clause of these Conditions,
3. exceptionally adverse climatic conditions,
4. unforeseeable shortages in the availability of personnel or
Goods caused by epidemic or governmental actions, or
5. any delay, impediment or prevention caused by or attributable to
the Employer, the Employer’s Personnel, or the Employer’s
other contractors.”
Subclause 8.4 in the WB contract is identical to that in the
FIDIC 99 except that the words “on the Site” are added to the
end of subparagraph (e) in the FIDIC 99. It is of significant importance to highlight the clauses mentioned in the WB contract that
raise entitlement to extension of time, as referred to in subparagraph (b), “a cause of delay giving an entitlement to extension
of time under a Sub-Clause of these Conditions.” Bunni (2005) lists
the following subclauses as relating to extension of time in the
FIDIC 99 and the authors contend that the same would apply to
the WB:
• Subclause 1.9: delayed drawings or instructions;
• Subclause 2.1: delay in giving access to or possession of
the site;
• Subclause 4.7: error in specified referenced points;
• Subclause 4.12: adverse unforeseeable physical conditions;
• Subclause 4.24: fossils;
• Subclause 7.4: delayed testing caused by employer;
• Subclause 8.5: delays caused by authorities;
• Subclause 8.9: a suspension initiated by the employer;
• Subclause 10.3: interference by employer in tests on
completion;
• Subclause 13: variations [dealt with in subclause 8.4 (a)];
• Subclause 13.7: adjustments for changes in legislation;
• Subclause 16.1: contractor’s entitlement to suspend work;
• Subclause 17.4: employer’s risks; and
• Subclause 19.4: Force Majeure
Tracing back the above provisions in the FIDIC 4th clarifies
that the delays that raise entitlement to extension of time are listed
under subclause 44.1, as follows: “In the event of: (a) the amount or
nature of extra or additional work, (b) any cause of delay referred to
in these Conditions, (c) exceptionally adverse climatic conditions,
(d) any delay, impediment or prevention by the Employer, or, (e)
other special circumstances which may occur, other than through a
default of or breach of contract by the Contractor or for which he is
responsible…being such as fairly to entitle the Contractor to an
extension of the Time for Completion of the Works, or any Section
or part thereof….” The authors highlight that subparagraph (b),
“any cause of delay referred to in these Conditions,” refers to a
much narrower range of clauses than those referenced to in the
WB contract or the FIDIC 99. According to Bunni (2005), such
subclauses could be classified as follows:
• “subclauses 6.3 and 6.4: delay in supply of documents;
• subclause 12.2: adverse physical obstructions or physical
conditions;
• subclause 27.1: fossils and articles of value and antiquity;
• subclause 36.5: tests required but not provided for;
• subclause 40.2: suspension of the progress of the works;
• subclause 42.2: failure to give possession of site;
• subclause 41.1: extension of time for commencement of
Works; and
• subclause 69.4: contractor’s entitlement to suspend work or
reduce rate of work.”
It is also of great importance to note that subparagraph (e),
“other special circumstances” is ambiguous, and according to
Bunni (2005), this statement has actually caused problems in interpretation and application. In this respect, Bunni (2005) adds that
whereas the FIDIC 4th makes no express provision for delays
arising out of the following:
•
•
•
•
“discrepancies in or divergence between contract documents;
errors in drawings, technical specifications;
changes in law/legislation;
delays caused by other contractors employed by the employer,
or nominated subcontractors/suppliers; and
• delays caused by public bodies/authorities.”
A question that arises here is, can the occurrence of such event
be classed as a special circumstance? Bunni (2005) suggests that
this would be “a matter for the Engineer’s consideration and at his
discretion.” However, such discretion must be exercised having regard to that which is “[fair] to entitle the contractor to an extension
of the time for completion of the works.” In the WB contract and
the FIDIC 99, there is no reference to other special circumstances.
Instead, subparagraph (b), “a cause of delay giving an entitlement
to extension of time under a Sub-Clause of these Conditions,” refers
to a wider range of subclauses. Also, subparagraph (d), “unforeseeable shortages in the availability of personnel or Goods caused by
epidemic or governmental actions” was added. This removes the
ambiguity in the FIDIC 4th caused by the provision of other special
circumstances.
Procedures
Under the WB contract, it is interesting to highlight that the procedures for extension of time are the same as those for additional
payment. Both are covered under subclause 20.1, which states the
following:
If the Contractor considers himself to be entitled to any extension of the Time for Completion and/or any additional payment, under any Clause of these Conditions or otherwise in
connection with the Contract, the Contractor shall give notice
to the Engineer, describing the event or circumstance giving
rise to the claim. The notice shall be given as soon as practicable, and not later than 28 days after the Contractor became
aware, or should have become aware, of the event or circumstance… Within 42 days after the Contractor became aware
(or should have become aware) of the event or circumstance
giving rise to the claim, or within such other period as may be
proposed by the Contractor and approved by the Engineer, the
Contractor shall send to the Engineer a fully detailed claim
which includes full supporting particulars of the basis of the
claim and of the extension of time and/or additional payment
claimed…
Fig. 1 illustrates the aforementioned procedures.
This leads us to the next question: what if the event has a continuing effect, what would be the procedures for extension of time?
The WB contract builds them on the above procedures by adding
the following to the same subclause 20.1:
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All the above provisions are identical to those in the FIDIC 99
except that the WB contract has modified the last few words in the
above paragraph from “within such time” to “within the above defined time period.” The purpose of such modification is not clear, as
both statements serve the required purpose. Subclause 20.1 adds
that the engineer’s determination shall be made pursuant to subclause 3.5 by stating that
Within the above defined period of 42 days, the Engineer shall
proceed in accordance with Sub-Clause 3.5 (Determinations)
to agree or determine (i) the extension (if any) of the Time for
Completion (before or after its expiry) in accordance with
Sub-Clause 8.4 (Extension of Time for Completion), and/or
(ii) the additional payment (if any) to which the Contractor
is entitled under the Contract.
Fig. 1. Extension of time under the WB contract and the FIDIC 99
If the event or circumstance giving rise to the claim has a continuing effect: (a) this fully detailed claim shall be considered
as interim; (b) the Contractor shall send further interim claims
at monthly intervals, giving the accumulated delay and/or
amount claimed, and such further particulars as the Engineer
may reasonably require; and (c) the Contractor shall send a
final claim within 28 days after the end of the effects resulting
from the event or circumstance, or within such other period
as may be proposed by the Contractor and approved by the
Engineer.
Fig. 2 illustrates the aforementioned procedures.
The WB contract provides timescales for the engineer to make a
determination with respect to extension of time and additional payment in subclause 20.1, as follows:
Within 42 days after receiving a claim or any further particulars supporting a previous claim, or within such other period
as may be proposed by the Engineer and approved by the
Contractor, the Engineer shall respond with approval or with
disapproval and detailed comments. He may also request any
necessary further particulars, but shall nevertheless give his
response on the principles of the claim within the above defined time period.
The first few words “Within the above defined period of
42 days” are added in the WB contract and are absent from the
FIDIC 99.
Comparing the above procedures with their respective ones under
the FIDIC 4th, it is interesting to highlight that under the FIDIC 4th,
the procedures for extension of time were not related to those for
additional payment. The procedures for each are covered under separate subclauses. The procedures for extension of time are covered
under subclause 44.2, which states the following:
Provided that the Engineer is not bound to make any determination unless the Contractor has (a) within 28 days after such
event has first arisen notified the Engineer with a copy to the
Employer, and (b) within 28 days, or such other reasonable
time as may be agreed by the Engineer, after such notification
submitted to the Engineer detailed particulars of any extension
of time to which he may consider himself entitled in order that
such submission may be investigated at the time.
Fig. 3 illustrates the aforementioned procedures.
The procedures for extension of time for events having a
continuing effect are regulated in subclause 44.3, which states
the following:
Provided also that where an event has a continuing effect such
that it is not practicable for the Contractor to submit detailed
particulars within the period of 28 days referred to in SubClause 44.2(b), he shall nevertheless be entitled to an extension of time provided that he has submitted to the Engineer
Fig. 2. Extension of time for events having a continuing effect under the WB contract and the FIDIC 99
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Notice
Delaying Event
28 days
Detailed Particulars
28 days
(may be
extended by
agreement)
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Fig. 3. Extension of time under the FIDIC 4th
interim particulars at intervals of not more than 28 days and
final particulars within 28 days of the end of the effects resulting from the event…
Fig. 4 illustrates the aforementioned procedures.
It is of great importance to note that under the FIDIC 4th, unlike
the WB contract and the FIDIC 99, there is no duration set for the
engineer to make a determination for extension of time. The only
requirement, in this regards is for the engineer to make a determination without undue delay.
Procedural Breaches by the Engineer and the
Contractor
A question usually asked by contractors is, what if the engineer
fails to determine extensions of time in accordance with the provisions of the contract? According to Booen (2000), “(a) there
would thereafter be no ‘Time for Completion (time is said to be
‘at large’); (b) the Contract would be construed accordingly
(Sub-Clause 8.6 may be inapplicable, for example); and (c) the
Contractor’s obligation would be to complete within a time which
was reasonable in all circumstances.” For clarification, item (b) entails that the employer may lose his entitlement to delay damages
under the contract. The WB contract and the FIDIC 4th would follow the same approach, as there is no deviation between the WB,
the FIDIC 4th, and the FIDIC 99 in this regard.
Another question which is a little more puzzling is, what if the
contractor fails to properly follow the procedures for extension of
time? Knowles (2005) answers this question by stating a general
rule: “Where a contractor or subcontractor fails to serve a proper
delay notice, this will not result in the loss of rights to an extension
of time unless the contract expressly states that the service of a notice is a condition precedent to such rights.” By applying the above
rule to the WB contract and similarly to the FIDIC 99, we note that,
according to subclause 20.1 “If the Contractor fails to give notice
of a claim within such period of 28 days, the Time for Completion
shall not be extended….” Hence, the service of a proper notice
is considered a condition precedent to the contractor’s entitlement
to extension of time. The same subclause continues to state that “If
the Contractor fails to comply with this or another Sub-Clause in
relation to any claim, any extension of time and/or additional payment shall take account of the extent (if any) to which the failure
has prevented or prejudiced proper investigation of the claim…”
The above provision would cover the contractor’s failure to properly follow the procedures pertaining to providing the details of the
claim for extension of time. The authors emphasize that the FIDIC
4th follows a totally different route in this regard. According to subclause 44.2, the engineer may, but is not bound to, make any
determination for extension of time, unless the contractor has followed the procedures set for extension of time. Hence, the service
of a proper notice and details are not considered a condition precedent to the contractor’s entitlement to extension of time under the
FIDIC 4th.
Acceleration
Some contracts tackle in detail the provisions for acceleration,
while others are silent about them. To avoid the misapprehension
of the provisions for acceleration, which in turn can cause U.S. contractors to incur additional costs, the authors introduce how such
provisions are tackled in the WB contract. Generally, the contractor
shall accelerate the works either to overcome delay(s) caused by the
contractor, or to overcome excusable delay that entitles the contractor to extension of time. An acceleration to overcome the latter
cause of delay would thus lead to the achievement of earlier completion than the date extended as a result of such excusable delay.
Subclause 8.6 of the WB contract and the FIDIC 99 asserts that
if the contractor is delayed in executing the works because of reasons that do not entitle the contractor to extension of time, the engineer may instruct the contractor to provide a revised program
(i.e., schedule) and report describing the measures the contractor
shall take to expedite progress in order to complete within the time
for completion. The contractor shall bear the acceleration costs.
Furthermore, if the employer incurs additional costs incurred as
a result (e.g., supervision costs in case the contractor works additional hours), the contractor shall reimburse the employer with such
costs, subject to the provisions of subclause 2.5 (Employer’s
Claims). If the contractor still fails to complete within the time
for completion, the contractor shall pay to the employer the delay
damages provided in subclause 8.7 (Delay Damages). It should be
noted that the engineer’s instruction given to the contractor to
Fig. 4. Extension of time for events having a continuing effect under the FIDIC 4th
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expedite progress should be carefully drafted in order not to be used
by the contractor to submit an unjustifiable claim for acceleration of
the works (Bunni 2005). Similar provisions apply to sub-clause
46.1 (Rate of Progress) of FIDIC 4th.
If the contractor apparently fails to proceed in accordance with
the engineer’s above instruction without reasonable excuse, the employer may be entitled to the terminate the contract pursuant to subclause 15.2 (Termination by Employer) in case of the WB contract
and the FIDIC 99 and to subclause 63.1 (Default of Contractor) in
case of the FIDIC 4th.
Under the WB contract, the engineer is entitled to instruct the
contractor to accelerate the works in order to achieve completion
before the time for completion expires, in case such time for completion has been extended because of delays which raise entitlement to extension of time, as listed under subclause 8.4. This is
provided in subclause 8.6, which is concluded by the following:
“Additional costs of revised methods, including acceleration measures, instructed by the Engineer to reduce delays resulting from
causes listed under Sub-Clause 8.4 (Extension of Time for Completion) shall be paid by the Employer, without generating, however, any other additional payment benefit to the Contractor.”
The authors record that the above is considered a major
deviation from the FIDIC 4th and the FIDIC 99. Under the FIDIC
4th and the FIDIC 99, there is no provision that entitles the employer to instruct the contractor to accelerate the works in order
to achieve completion before the time for completion expires.
The only means for the employer to achieve such early completion
is to enter into an acceleration agreement with the contractor.
According to the Booen (2000), “The Employer is not empowered
to instruct the Contractor to complete prior to the Time for Completion, and the Contractor is not obliged to comply with any such
instruction.”
Payment
It is of crucial importance for contractors to familiarize themselves
with the provisions for payment in any contract. It is acknowledged
that cash flow is of ultimate importance for the contractor to proceed with the works. In this paper, the authors will not cover all the
provisions for payment, but will shed light on some important provisions in relation to payment that U.S. contractors need to pay
attention to while working under WB contracts.
Subclause 14.1 of the WB contract and FIDIC 99 (The Contract
Price) asserts that the contractor is liable to pay all taxes, duties, and
fees required to be paid by him under the contract. The contract
price is thus deemed to include all taxes. The same subclause
asserts that the contract price shall not be adjusted for any of
these costs except if there is a change in legislation that affects such
costs, pursuant to subclause 13.7 (Adjustments for Changes in
Legislation).
Also, under subclause 14.3 of both the WB contract and FIDIC
99 (Application for Interim Payment Certificates), the contractor
shall submit a statement after the end of each month showing
the amounts they considers themselves to be entitled to, together
with supporting documents, including the progress report. The
statement shall be submitted in a form previously agreed with
the engineer. The period for payment shall commence from the date
the contractor submits the statement with the supporting documents, including the progress report.
It is the obligation of the engineer, under subclause 14.6 of the
WB contract and FIDIC 99 (Issue of Interim Payment Certificates),
to issue to the employer and to the contractor an interim payment
certificate indicating the amount they fairly determine to be due to
the contractor. As for the duration for payment by the employer,
this is stipulated in subclause 14.7 of the WB contract and FIDIC
(payment), which provides that the employer shall pay the amount
certified in each interim payment certificate within 56 days after the
engineer receives the statement and supporting documents. The
WB contract adds “or, at a time when the Bank’s loan or credit
(from which part of the payments to the Contractor is being made)
is suspended, the amount shown on any statement submitted by the
Contractor, within 14 days after such statement is submitted, any
discrepancy being rectified in the next payment to the Contractor.”
This addition takes into consideration the method of payment under
the World Bank–funded or partially funded projects. It should be
noted that the duration of 56 days starts from the date the engineer
receives the statement and supporting documents, regardless of
when the engineer shall issue the interim payment certificate. Fig. 5
illustrates the aforementioned sequence of interim payments.
The FIDIC 4th, issued in 1987, gives the same 28-day duration
to the engineer to issue the interim payment certificate. However,
the duration for the employer to make the payment is given as
within 28 days from the day the engineer delivers to the employer
the interim payment certificate. This usually raised the problem that
if the engineer was delayed in issuing the interim payment certificate, the employer still had 28 days to make the payment. Hence,
the duration for payment, in some instances, exceeded 56 days
from the day the engineer received the statement. This was, however, catered for in the supplement to the Fourth Edition issued
in November 1996, which provided similar durations as in the
FIDIC 99. Figs. 6 and 7 illustrate the aforementioned sequence
of payments.
Withheld Payments
The employer is not entitled to withhold the payment of any
amount determined by the engineer in an interim payment certificate. The interim payment certificate issued by the engineer is
binding upon the employer and the engineer must make payment
with respect thereof in full, regardless of any claim against the contractor (Bunni 2005). If the employer has a claim against the
contractor, it should be given through subclause 2.5 (Employer’s
Claims) and the employer is not entitled to withhold the amount
from payments due to the contractor, unless and until the procedures described in subclause 2.5 have been followed.
It should be noted, however, that under subclause 14.6 (Issue of
Interim Payment Certificates), an
Interim Payment Certificate shall not be withheld for any
other reason, although: (a) if anything supplied or work done
by the Contractor is not in accordance with the Contract, the
Fig. 5. Sequence of interim payments under the WB contract and the
FIDIC 99
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Fig. 6. Sequence of interim payments under the FIDIC 4th
contractor shall be entitled to financing charges compounded
monthly on the unpaid amount during the period of delay. Such
period shall be deemed to commence on the due date for payment (i.e., 56 days from the day the engineer receives the statement). The financing charges are calculated at the annual rate
of three percentage points above the discount rate of the central
bank in the country of the currency of payment. The WB contract adds the provision “or if not available, the interbank offered rate.” The contractor shall be entitled to this payment
without sending a formal notice and without prejudice to
any other right or remedy.
2. The second sanction for delayed payment is provided for in
subclause 16.1 (Contractor’s Entitlement to Suspend Work),
where the contractor is entitled to suspend work or reduce
the rate of work, having provided the proper notices in accordance with the contract. The WB contract and the FIDIC 99
also give this right to the contractor if the engineer fails to certify within 28 days after the date the statement was received
by the engineer or if the employer fails to comply with subclause 2.4. The WB contract adds a fourth condition under
which the contractor is entitled to suspend work or reduce the
rate of work; that is
if the Bank has suspended disbursements under the loan
or credit from which payments to the Contractor are
being made, in whole or in part, for the execution of
the Works, and no alternative funds are available as
provided for in Sub-Clause 2.4 (Employer’s Financial
Arrangements), the Contractor may by notice suspend
work or reduce the rate of work at any time, but not less
than 7 days after the Borrower having received the suspension notification from the Bank.
Fig. 7. Sequence of interim payments under the supplement to
FIDIC 4th
cost of rectification or replacement may be withheld until rectification or replacement has been completed; and/or (b) if the
Contractor was or is failing to perform any work or obligation
in accordance with the Contract, and had been so notified by
the Engineer, the value of this work or obligation may be withheld until the work or obligation as been performed.
The purpose of this provision is to ensure that the contractor is
not paid for works that are not in accordance with the contract and
that he has an incentive to properly complete such works (Bunni
2005). Yet it is the engineer who is entitled to withhold the above
amounts, not the employer.
Delayed Payments
The WB contract and the FIDIC 99 provide three sanctions in case
of delayed payments: financing charges on delayed payments, the
contractor’s entitlement to suspend work, or reduce the rate of work
and the contractor’s entitlement to terminate his employment. The
three sanctions are detailed as follows.
1. Under subclause 14.8 of the WB contract and FIDIC 99
(Delayed Payment), if the employer is delayed in making
payment beyond the timeframes set in subclause 14.7, the
If the contractor suffers delay and/or incurs cost as a result
of suspending the work, the contractor shall give notice to the
engineer and shall be entitled to an extension of time for any
such delay and/or payment of any costs that he has incurred, in
addition to a reasonable profit.
3. The third sanction for delayed payment is provided for in subclause 16.2 (Termination by Contractor), where the contractor
is entitled to terminate the contract if he does not receive the
amount due under an interim payment certificate within 42 days
after the expiry of the timeframe set in subclause 14.7 (Payment), having provided the proper notices in accordance with
the contract. The WB contract and the FIDIC 99 also give this
right to the contractor if the engineer fails to certify within
56 days after the date the statement was received by the engineer or if the contractor does not receive the reasonable evidence within 42 days after giving notice under subclause
16.1 (Contractor’s Entitlement to Suspend Work) in respect
of a failure to comply with subclause 2.4 (Employer’s Financial Arrangements). The WB contract adds another condition
related to payment, which entitles the contractor to terminate
the contract, that is
In the event the Bank suspends the loan or credit from
which part of the payments to the Contractor are being
made, if the Contractor has not received the sums due
to him upon expiration of the 14 days referred to in
Sub-Clause 14.7 (Payment) for payments under Interim
Payment certificates, the Contractor may, without prejudice to the Contractor’s entitlement to financing charges
under Sub-Clause 14.8 (Delayed Payment), take one
of the following actions, namely (i) suspend work or reduce the rate of work, or (ii) terminate his employment
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under the Contract by giving notice to the Employer,
with a copy to the Engineer, such termination to take
effect 14 days after the giving of the notice.
The FIDIC 4th provides similar provisions. Under subclause
60.10 (Time for Payment), the contractor shall be entitled to interest
at the rate stated in the Appendix to Tender upon all sums unpaid
from the date by which the same should have been paid. Under subclause 69.4 (Contractor’s Entitlement to Suspend Work), the contractor shall be entitled to suspend work or reduce the rate of work,
having provided the proper notices in accordance with the contract.
Under subclause 69.1 (Default of Employer), the contractor shall be
entitled to terminate his employment under the contract, again, having provided the proper notices. It should be noted that the
durations for the above notices are different in the FIDIC 4th than
in the FIDIC 99 and the WB contract.
Conclusion
Under the WB contract, although the employer hires the engineer to
act as a supervisor to the works, an administrator and a certifier, the
employer can change the authority attributed to the engineer and
should promptly inform the contractor of such change. The engineer must seek the approval of the employer before taking action
related to issues including inter alia, determining an extension of
time and/or additional cost, if the contractor encounters unforeseeable physical conditions and variations. Yet when the contractor
receives a determination from the engineer for which the employer’s prior approval was required, the employer is deemed to have
given approval. The role of the engineer, under the WB contract, is
not stated to be of a wholly impartial nature.
Also, under the WB contract, there is no timescale set for the
general approval process. It rather should be granted within a reasonable period. However, according to subclause 3.1, any act by the
engineer in response to a contractor’s request except otherwise expressly specified shall be notified in writing to the contractor within
28 days of the engineer’s receipt of the contractor’s request. Furthermore, under subclause 3.5, the engineer shall respond with supporting particulars to a claim or request within 28 days from the
receipt thereof except when otherwise specified.
The authors further highlighted what triggers the commencement date under the WB contract. According to subclause 8.1,
the commencement date is the date at which a number of conditions
have all been fulfilled, the parties agreeing to the fulfillment of the
conditions and the engineer’s instruction recording such agreement
is given. The conditions constitute signing the contract agreement,
approval of the contract by the relevant authorities in the country,
delivery of reasonable evidence of the employer’s financial arrangements, possession of the site given to the contractor together
with the permissions (except if otherwise specified), and receipt by
the contractor of the advance payment. The contractor shall be entitled to terminate the contract if the said engineer’s instruction is
not received by the contractor within 180 days from his receipt of
the letter of acceptance. The authors assert that such provisions represent a major deviation from the FIDIC 4th and the FIDIC 99.
The authors recorded that the procedures that the contractor
should follow to submit a claim for extension of time are the same
as those for additional payment, both covered under subclause 20.1.
The service of a proper notice, in accordance with subclause 20.1,
is considered a condition precedent to the contractor’s entitlement
to extension of time and/or additional costs. Nevertheless, if the
contractor fails to comply with the remaining procedures in said
subclause or another subclause in relation to any claim, any entitlement to extension of time and/or additional payment shall take
account of the extent (if any) to which the failure has prevented or
prejudiced proper investigation of the claim. On the other hand, if
the engineer fails to determine extensions of time in accordance with
the provisions of the contract, there would be no “Time for Completion,” as time is said to be at large, the contractor’s obligation
would be to complete within a reasonable time and the employer
may lose his entitlement to delay damages under the contract.
The authors shed the light that under the WB contract, unlike
under the FIDIC 4th and the FIDIC 99, the engineer is entitled to
instruct the contractor to accelerate the works in order to achieve
completion before the time for completion expires, in case such
time for completion has been extended because of delays that raise
entitlement to extension of time. On the other hand, if the contractor
is delayed in executing the works because of reasons that do not
entitle the contractor to extension of time, the engineer may instruct
the contractor to provide a revised program and report describing
the measures the contractor shall take to expedite progress in order
to complete within the time for completion. In such case, the contractor shall bear the acceleration costs. If the contractor apparently
fails to proceed in accordance with the engineer’s above instruction,
without reasonable excuse, the employer may be entitled to the
terminate the contract.
Realizing how the negative impact of claims and disputes can
be intensified under World Bank–funded projects because of the
involvement of many multinational and multicultural stakeholders,
the authors are working to present further contract administration
guidelines to deal effectively and efficiently with the issues of
claims and dispute resolution and how they are associated with
unforeseeable physical conditions, employer’s risks, force majeure,
and delay damage
Acknowledgments
This work would have not been possible without the professional
resources and experiences provided by Dr. Sherif El-Haggan
(Partner, Contract Administration & Arbitration Bureau, Egypt)
and Mr. Erminio Granata (Managing Director, Nile Aster International S.A.E., Egypt). The authors are professionally and personally indebted to them.
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