jan08-q&a-6

My comments are given in red below,

From: Gudmi Mohammed Sadik [mailto:[email protected]] Sent: Thursday, March 27, 2008 8:57 AMTo: Prof. SamSubject: RE: Jan08-Q&A-6

Dear Doc,We have a D&B Contract with some PC items. Now we have nominated the supplier for these PC items. For the adjustment of contract sum accordingly I am facing following problem. There appears to be a big flaw in the procurement route. In Design & Build Contracts, the Employer does not provide a BOQ. Assuming that the D&B Contractor produced the BOQ, the following comments are made.

The B.O.Q Qty is more than actual quantity based on contract drawing. For eg. We have ceramic tiles with 124 sqm with the rate of 95 Dhs while the actual quantity as per contract drawing comes with 83 sqm with new rate of 87.2 Dhs based on supplier’s rate. Please advice while reconciliating the contract price I should omit the 124 sqm with 95 Dhs or 83 sqm with 95 Dhs. To get the adjusted contract sum. ( please note that there is no adjustment item nor p>S in the B.O.Q)

Omit 83 x 95 and add 83 x 87.2 and also adjust the Overheads and profit accordingly. (This is the way PC rate adjustment is made under Lump Sum Contracts. For Re-measure contracts 124 x 95 should be omitted and 83 x 87.2 should be added and OH&P adjusted accordingly, but since D&B contracts are generally not re-measure type, this method is not applicable)

Regards,

Prof. Sam. Prof. Indrawansa Samaratunga PhD, DScFRICS, FAIQS, FIQSSL, FCIArb, FCIOB, FCMI, FASI, FBEngChartered Quantity Surveyor and Registered Arbitrator / ExpertAustralian Inst.of Qty.Surveyors-Middle East RepresentativePO Box 23461, Dubai, UAE. T +971504588949 F +97143378668

Thanks and Regards

Mohd. Sadik. G

----- Original Message -----From: Faisal Khan To: [email protected]: Thu, 27 Mar 2008 11:23:18 +0400Subject: [No Subject]

Respected Sir, I have the following query regarding Clause 52.3 : In FIDIC 1987, the manner in which Clause 52.3 is written is ambiguous. I do not agree. True that it is difficult to understand but it is not ambiguous. The Sub-Clause was explained in detail during the course. There is lot of incorrect applications of this Sub-Clause in this part of the world because almost all (other than trained) Contract Administrators are ignorant about its correct application). In our Contract, work has been deleted by an amount such that it exceeds the 15% mentioned in this Clause. Due to the above, the Contractor has claimed for overheads which far exceed the allowable overheads (16.7%) (which have to be added to the Effective Contract Price) for our project. Now, it is required by myself to write a letter back to the Contractor confuting his claim quoting Clause 52.3. As per normal procedure, the above letter is to be signed by the Resident Engineer but I found it very difficult to explain the operation of the Clause 52.3 and at the end he was not convinced due to the ambiguity of the wording of this Clause. My question is that is there any other certified / recognised book which substantiates FIDIC 1987 and explains clearly this Clause? I am afraid there are no books written on this subject. If not, then can you advise on how I should convince my R.E. regarding the operation of this Clause? You can suggest him to attend the next CA training programme starting on 20th April where he would gain full knowledge on the correct application of Sub-Clause 52.3. This is why I have previously circulated the following email among the Alumni in order to make their lives easier.

Regards,


An early reply would be appreciated. Regards, Mohammed Faisal KhanQuantity SurveyorWilbur Smith AssociatesBatch of Spring 2007

Dear Alumni of “Sound Contract Administration” Training Course,

Thank you for your support in the past in recommending the course to your colleagues.

I have no doubt that you (and especially your company) may have benefited from the knowledge you gained from the "Sound Contract Administration" training course and its regular updates (based on queries received) being emailed to you from time to time. Just imagine, to what extent life would be easier, if you could communicate in the same wave length with your counterparts, subordinates and colleagues, when dealing with contract administration matters, without having to elaborate at great length, a point that you wish to make ! However, this is possible, only if they too are knowledgeable to an equal level as you are.

Few places are still available in the Class of Spring 2008 which starts on 20th April 2008. Course details are attached. I shall be grateful if you could pass this to anyone who could benefit from this training.

Regards,

Prof. Sam.Prof. Indrawansa Samaratunga PhD, DSc

FRICS, FAIQS, FIQSSL, FCIArb, FCIOB, FCMI, FASI, FBEngChartered Quantity Surveyor and Registered Arbitrator / ExpertAustralian Inst.of Qty.Surveyors-Middle East RepresentativePO Box 23461, Dubai, UAE. T +971504588949 F +97143378668

-----Original Message-----From: [email protected] [mailto:[email protected]] Sent: 31 March 2008 15:10To: Prof. SamSubject: question

Dear Dr.sam I would request you to advice me on following situation: Question 1. The contractor has a valid claim for extension of time and additional cost due to additional works instructed by the engineer in one of our RTA contract. The client has agreed in principle for the extension of time and cost, but nothing in writing. Since the engineer cannot monitor the progress based on the approved clause 14 programme, he keeps on requesting for a revised programme incorporating all the additional works. Is it advisable to submit a revised programme before finalising the claims? It is the Contractor’s obligation to submit a revised programme if the work is not proceeding according to the original programme. However the Finish Date in the revised programme need not be the original date for completion. It should be the date, which in the Contractor’s opinion that he is fairly entitled to complete the Works. Question 2. If the consultant did not provide the detailed specification of irrigation works for tender and as an experienced contractor we priced it You should also have stated in the Tender, your assumptions regarding the specification that you priced. If you did not do this, then you will have a difficulty to refuse to provide the standard of material and workmanship that the Engineer may subsequently specify. But during execution stage we are in need of it for the material submittals and other references, can i ask for it officially ? I suggest that you first submit your material samples for approval, according to your Tender assumptions, and see whether they would be approved by the Engineer. How can i defend myself if any variation arises due to the new specification ? Since your Tender assumptions should have been for material generally suitable for the intended work, if the Engineer/Employer now requests for material of a higher standard, you should try to argue that such high standard could not be inferred from the tender documents and therefore it constitutes a variation.

Regards,


regards

-----Original Message-----From: sini noushad [mailto:[email protected]] Sent: 02 April 2008 17:05To: Prof. SamSubject: More Q&A

Sir,Is the Engineer can issue the Letter of intent to the Nominated sub contractor if employer delays the same?. The Sub contract would be between the Contractor and the Nominated Subcontractor and therefore the LOI or the LOA should be issued by the Contractor to the Subcontractor, after the Contractor has been informed by the Engineer of the nomination. The Engineer can issue only a letter to the Nominated Subcontractor informing him that his bid documents have been forwarded to the Contractor for them to enter into a Subcontract. (However, if according to the consultancy agreement between the Employer and the Engineer, if Engineer is required to obtain Employer’s approval before making a nomination, then the Engineer should neither write to the Contractor nor to the Subcontractor until such approval is in place.)

Also what is the difference of letter of intent and letter of acceptance? On the issue of a Letter of Acceptance, the contract is formed. On the issue of a Letter of Intent, the contract is not formed and therefore, the Contractor should proceed only with what has been stated in the LOI and if the Contract is not subsequently signed, then the parties are not bound by the provisions in the Tender, and the payment would be on a quantum meruit basis.

Regards,


Thanks and regardssini

-----Original Message-----From: Hani Ahmad Khalili [mailto:[email protected]]

Sent: 03 April 2008 09:39To: Prof. Sam

Cc: Musa Khalil Abul HajSubject: clarification

Dear Sir,

We were discussing as engineers in RTA during rest time lot of contractual issues. The following questions were raised but dispute took place due to different opinions.

Can you please clarify?

Q1. Is the Client thru Engineer able to instruct VO (additional works) to the Contractor after the engineer sent a letter to the Client inform him that the work is substantially completed subject to completion of some works?

Case A: Parts of the additional works are within current contract limits and lays within parts of the permanent works used by client.

Case B: parts of works completed but not inspected by client only consultant send a letter that main works completed and contractor submit under taken to complete remaining works during defect liability period

Case C: Parts of the additional works are out current contract limits

The answer to all three cases is that the Engineer cannot instruct additional work unless such additional work is necessary to complete the original scope of work. If it is necessary, then it can be instructed but the Contractor should be properly compensated in each of the above cases (as he would have valid claims for working outside the site limits, working after completion of the Works etc.)

(Assume that contractor was delayed completion project on time). This should be assessed separately in respect of EOT/Penalties depending on the circumstances.

What do you recommend for Mechanical Engineer to attend in order to practice and be sound contract administrator?

Whether the scope of work is Mechanical or Civil, if the Engineer is required to administrate the contract properly, (in addition to his knowledge in Mechanical Engineering), he must gain knowledge/experience/training in all subjects that you were trained in at the “Sound Contract Administration” training course, i.e. Dealing with Variations, EOT/Cost issues, Notice requirements, how to interpret the key contract provisions, drafting contracts/subcontracts, dispute resolution, procurement methods, ethics, existing incorrect practices in contract administration, the correct practice etc. (except perhaps the CESMM3 session).

Regards,


Hani Ahmad KhaliliSenior Engineer

jan08-q&a-6

Documents