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Claims Under FIDIC & NEC___________________________________________7-8 May 2012, Mumbai

Report Submitted by Er. Pravin Kolhe, Executive Engineer, MID2, Akola ________________________ Page 2 of 28

Executive Summary

he workshop on Claims under FIDIC and NEC was organized by

the Global Knowledge Conference, Mumbai on 7 & 8th May 2012,

at Ramada Plaza Palm Grove, Juhu Beach, Mumabi.

The acronym FIDIC stands for Fdration Internationale Des

Ingnieurs-Conseils, French for the International Federation of Consulting

Engineers. The New Engineering Contract (NEC), or NEC Engineering and

Construction Contract is a formalized system created by the Institution of

Civil Engineers that guides the drafting of documents on civil engineering

and construction projects for the purpose of obtaining tenders, awarding

and administering contracts.

The lectures during the workshop were presented by PAUL

GREENWELL, BSc, Msc, FCIArb, MCIOB, who is specialises in project and

programme management, construction planning, critical path analysis

and claims development/rebuttal. DAVID DELLAR, BEng, CEng, MBA,

MIStructE, MAPM also delivered some part of lectures who is specialises

in programming and delay analysis, construction sequencing assessment,

claims preparation and live project advice.

The 2 day seminar was focused on Claims of Contractor under the

FIDIC and NEC contract agreement. This report includes the details of

workshop and observations performed by me. It was nice experience

since I could realize the importance of contract provisions under FIDIC

and NEC. I learned valuable information regarding various contract

clauses and I had collected reference materials.

T

Claims Under FIDIC & NEC___________________________________________7-8 May 2012, Mumbai

Report Submitted by Er. Pravin Kolhe, Executive Engineer, MID2, Akola ________________________ Page 3 of 28

Acknowledgement

take this opportunity to express my gratitude to those whose active

help and support make this report possible in the present form.

First of all, I express my sincere gratitude to Er. P.C. Zapake,

Executive Director, Vidarbha Irrigation Development Corporation, Nagpur

and Er. Bhagat, Superintending Engineer, Vidarbha Irrigation Development

Corporation, Nagpur for proposing me as a representative of Vidarbha

Irrigation Development Corporation, Nagpur for the mentioned workshop.

It is the endless guidance and constant encouragement of Er.

Rajendra Pawar, Chief Engineer, Special Projects, Water Resources,

Amravati and Er. R.V. Jaltare, Superintending Engineer, Akola Irrigation

Circle, Akola and I would like to express my heartfelt gratitude to them for

allowing me to participate in the said workshop.

Er. Pravin Kolhe,

Executive Engineer,

Minor Irrigation Division No.-2, Akola

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I

Claims Under FIDIC & NEC___________________________________________7-8 May 2012, Mumbai

Report Submitted by Er. Pravin Kolhe, Executive Engineer, MID2, Akola ________________________ Page 4 of 28

Content

ContentsExecutive Summary ............................................................................................................................. 2

Acknowledgement ................................................................................................................................ 3

Content .................................................................................................................................................... 4

1. Introduction to Contracts ....................................................................................................... 7

1.1. Introduction to Contracts ................................................................................................... 7

1.2. Elements of Contract ............................................................................................................ 7

1.3. Indian Contract Act, 1872 .................................................................................................. 7

1.4. Structure of Indian Contract Act, 1872 ........................................................................ 8

2. Introduction to FIDIC .............................................................................................................. 9

2.1. About FIDIC ............................................................................................................................. 9

2.2. Evolution of main forms .................................................................................................... 10

2.3. FIDIC Suite of Contracts ................................................................................................... 10

2.3.1. Works Contracts ............................................................................................................... 10

2.3.2. Service Agreements ........................................................................................................ 10

2.4. Allocation of Risk ................................................................................................................. 11

2.5. Contractual Risks ................................................................................................................. 11

3. Introduction to NEC ................................................................................................................ 12

3.1. Introduction to NEC ............................................................................................................ 12

3.2. Engineering and Construction Contract (ECC) ..................................................... 12

3.3. The Engineering and Construction Subcontract Contract (ECS) .................. 13

3.4. The Engineering and Construction Short Contract (ECSC) ............................. 13

3.5. The Engineering & Construction Short Subcontract (ECSS) .......................... 13

3.6. The Professional Services Contract (PSC) ............................................................. 13

3.7. Framework Contract (FC) ............................................................................................. 14

3.8. Term Service Contract (TSC) ...................................................................................... 14

3.9. Supply Contract/Short Supply Contract (SC/SSC) ............................................ 14

3.10. Adjudicator's Contract (AC) .................................................................................... 14

3.11. Guidance Notes and Flowcharts ............................................................................ 14

Claims Under FIDIC & NEC___________________________________________7-8 May 2012, Mumbai

Report Submitted by Er. Pravin Kolhe, Executive Engineer, MID2, Akola ________________________ Page 5 of 28

4. Overview of FIDIC & NEC ..................................................................................................... 15

4.1. Overview of FIDIC Contracts .......................................................................................... 15

4.1.1. Selection of FIDIC Contract Document ............................................................... 15

4.1.2. Key features ................................................................................................................... 16

4.2. Overview of NEC Contracts .............................................................................................. 16

4.2.1. NEC family ...................................................................................................................... 16

4.2.2. Structure of NEC ........................................................................................................... 17

4.2.3. Main Option Clauses ................................................................................................... 17

4.2.4. Key Issues ...................................................................................................................... 18

4.3. FIDIC and NEC Contrasted ............................................................................................... 18

4.3.1. Philosophy ...................................................................................................................... 18

4.3.2. Layout Style & Family ................................................................................................ 18

5. Claims of Contractor ..............................................................