How Do You Submit a Claim Under a FIDIC Contract?

Question from Piet, How Do You Submit a Claim Under a FIDIC Contract?

Answer from AI:

Submitting a claim under a FIDIC (International Federation of Consulting Engineers) contract involves a series of steps that are outlined in the contract itself. FIDIC contracts are commonly used in international construction projects and provide a standardized approach to managing claims and disputes. Here is a general overview of the process:

Understanding FIDIC Contracts

FIDIC contracts are known for their detailed provisions on various aspects of construction projects, including claims. The most commonly used FIDIC contracts are the Red Book (Construction), Yellow Book (Plant and Design-Build), and Silver Book (EPC/Turnkey Projects). Each has specific clauses related to claims.

Identifying the Relevant Clauses

• First, identify the relevant clauses in your FIDIC contract that pertain to claims. These are typically found in the clauses related to employer’s claims (Clause 2) and contractor’s claims (Clause 20 in the 1999 edition, Clause 21 in the 2017 edition).

Notification of Claim

• The claiming party must notify the other party of their intention to claim within a specified time frame, usually 28 days from the date they became aware, or should have become aware, of the event or circumstance giving rise to the claim.

Detailed Claim Submission

• After the initial notification, a fully detailed claim must be submitted within a further specified period, often 42 days. This submission should include a detailed description of the event, the basis of the claim, and the extension or payment sought.

Engineer’s Response

• Upon receiving the detailed claim, the Engineer (as defined in the contract) has a set period to respond—usually 42 days. The Engineer may request additional information, provide a determination, or reject the claim.

Keeping Records

• It is crucial to keep detailed records and documentation to support the claim, as these will be essential in the Engineer’s review and any potential dispute resolution process.

Amicable Settlement

• If the claim is not resolved through the Engineer’s determination, the parties may attempt to settle the claim amicably before proceeding to arbitration or litigation.

Dispute Adjudication/Avoidance

• If an amicable settlement is not reached, the parties may refer the dispute to a Dispute Adjudication Board (DAB) or a Dispute Avoidance/Adjudication Panel (DAAB) as per the 2017 editions, which provides a decision that can be binding until finally resolved by arbitration or litigation.

Arbitration or Litigation

• If the DAB/DAAB decision is not satisfactory, the parties may proceed to arbitration or litigation, as specified in the contract.

Seeking Legal Advice

It is important to note that the above steps are a simplified overview of the process. The specific details and requirements for submitting a claim under a FIDIC contract can be complex and may vary depending on the particular contract and the circumstances of the claim. Therefore, it is strongly recommended that parties consult with a legal professional who specializes in construction law and international contracts for personalized advice.

For more information on FIDIC contracts and guidelines, you can visit the official FIDIC website.

Remember, the process of submitting a claim under a FIDIC contract requires careful attention to detail and adherence to contractual timelines. Failure to comply with the contract’s requirements can result in a claim being time-barred or otherwise invalidated.