Knowledge Hub Archive - December 2015

Frozen Out

Written by Victoria Tyson | 16/12/2015

What relief does FIDIC provide when bank accounts are frozen as a result of war, hostilities, rebellion, terrorism etc.? Maybe not as much as you think. Tensions in Africa and the Middle East have seen the implementation of numerous international financial sanctions. While these sanction regimes vary in execution and enforcement they often freeze assets and prevent financial transactions. These restrictions may impact on the Employer’s performance of its payment obligations under the Contract. This can have serious consequences where the Contractor is entitled to suspend or terminate on notice for non-payment. Many parties automatically assume that financial sanctions will be recognised as force majeure. However, this may not be the case....

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Where Do FIDIC Cases Go?

Written by Joanne Clarke | 16/12/2015

FIDIC is arguably the most widely used standard form of international construction contract but reported FIDIC cases are rare. Is it time for an increased publication of FIDIC cases? There are three categories of decisions arising out of FIDIC dispute resolution provisions: 1. Decisions of the Engineer or the Dispute Adjudication Board (DAB), which will generally not be published or reported to anyone other than the parties involved in the dispute. 2. Decisions of arbitral tribunals, which are not usually made public although this is subject to certain exceptions. 3. Decisions of national courts, which are a relatively rare occurrence for the reasons discussed below. ...

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Society of Construction Law’s Rider 1 to its Delay and Disruption Protocol

Written by Gabriel Mulero Clas | 16/12/2015

In July of this year, the Society of Construction Law (SCL) published Rider 1 (“the Rider”) of its 2002 Delay and Disruption Protocol (“the Protocol”). The Rider’s Preamble lists a series of amendments to the Protocol intended to serve as an update reflecting (a) legal and industry practice developments, (b) feedback, (c) technological developments, (d) increase in scale of larger projects, and (e) international use of the Protocol. The Rider is intended to serve as the first part of the amendments to the Protocol, the totality of which should feature in a consolidated and updated version of the Protocol later this year.[1]...

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Employers Beware

Written by Victoria Tyson | 16/12/2015

How important is it for an Employer to give a Sub-Clause 2.5 notice of a set-off or cross-claim under the FIDIC Red Book form of contract? Very, according to the Privy Council in NH International (Caribbean) Limited v National Insurance Property Development Company Limited . It found that: o Sub-Clause 2.5 applies to any claims the Employer wishes to make. o The Employer must make such claims promptly and in a particularised form. o Where the Employer fails to raise a claim as required, the back door of set-off or cross-claims is firmly shut. The case also serves as a warning to Employers who take a relaxed view towards their obligation under Sub-Clause 2.4 to provide reasonable evidence of the financial arrangements they have made and are maintaining to pay the Contract Price. It doesn’t matter how wealthy or important the Employer is (it may be a Government, company or individual with very substantial funds) detailed financial information must still be provided....

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FIDIC’s Sub-Clause 20.5 – A Condition Precedent to Arbitration

Written by Andrew Tweeddale | 16/12/2015

The 1999 FIDIC forms of contract contain a number of obligations and/or conditions precedent that require (a) a party to give notice of a claim (Sub-Clauses 20.1 and 2.5); (b) refer the claim to the Engineer (Sub-Clauses 20.1 and 3.5); and (c) submit the dispute to a Dispute Adjudication Board (“DAB”) (Sub-Clause 20.4). If either party gives a notice of dissatisfaction relating to the DAB’s Decision then Sub-Clause 20.5 provides that: “Where notice of dissatisfaction has been given under Sub-Clause 20.4 above, 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 fifty-sixth day after the day on which notice of dissatisfaction was given, even if no attempt at amicable settlement has been made.”...

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Corbett & Co Director contributes chapter to CIArb liber amicorum

Written by Charlotte Noon | 10/12/2015

Corbett & Co Director Andrew Tweeddale has contributed a chapter to the Chartered Institute of Arbitration (CIArb) liber amicorum recently published in celebration of its centenary. Andrew has written a chapter entitled “Shifting the Burden of Proof: Revisiting Adjudication Decisions”. He comments: “I was delighted to be invited to contribute to this publication, especially as this is the CIArb’s centenary.”...

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