Award Section of Works to Subcontractor

Hi,

without the agrement with the main contractor,it is not allowed to delete any part from the original sope of works and give it to another contractor or subcontractor.

you can reserve your rights and you can stady the impact and implications of this action.
yes the engineer is in breach of the contract.
Rgards

Thanks Ashraf for your reply.

To tell you the history, its been long in the pipeline that the Engineer’s intentions became evident. We never objected nor agreed. But, since it is done now, we want to raise a cost claim. What areas we can exploit to build our claim apart from loss of profit.

Honestly, we do not want to jump into litigation on breach of contract coz of obvious reasons.

Cheers

Hi Sajid
I have few contribution for you on thi topic. The Engineer breached the contract provisions and you have you remedies in asking for loss of expected profit andunabsolved overheads... You may go further by asking for damages associated with the removal of the works.

Dont forget also that Consultants may ask you to include your profit and attendance for an NSC packages/works.. This is a back door way of escaping the wrath of the Contractor claims....

Cheeerrrrrrrrs

Just to add few note, ENgineer has right to add, modify or omitt any portion of the work. This is his contractual right.

Nevertheless, the omission of a portion of a contract should not be carried out on ecomic benefit to the Client, it may be carried out as a result of change in functions, no longer required or for exigency reason but not to be given to another contractor for cheaper cost or for any benefit to the client.

You may contact me in future for simillar problem

Regards

Dear Sajid,

Since your Contract is under FIDIC, please review clause (1/7 - Assignment) regarding the conditions needed for one side of the Contract to give up one part or all of the Contract.

Good luck,

Samer

Thank you all for taking time to respond to my thread.

I have gone through the project documentation and now safely say that we, as epc contractor, asked to remove the design portion of the said section of works to avoid long delays of co-ordination between various stakeholders.

Also, I have came across with correspondences where the project Quantity Surveyors recommneded the Employer to remove the said Section of the Works from our SOW to be more cost benificial to the Employer.

I have gone though the conditions of the contract but could not find any clause that prevent Employer to take such a step or entitling us to ask for lost revenue.

I agree the right of Employer with VO but awarding it to our Subcontarctor is beyond my digestion.

Please enlighten me with your comments.

Hi Sajid

In this case it is not the contract that rules but common law.

When the Contractor agrees to do the work the Employer agrees that the Contractor shall do it all.

The Employer may omit some part of the work that he no linger wants but he can’t just take a big lump out and give it to someone else - particularly NOT your sub-contractor.

Any way the deal is done but you must now consider the programming aspect of the change.

The original sub-contract work was part of your contract programme.

Change the detailed section programme to one solid bar in a different colour and call it Omitted Works.

Take all the float from that section and add it to your own programme by using a Time Risk Contingeny bar - this ensures the omitted work is critical.

Monitor progress every week and if there is any slippage on the omitted works increase the duration and claim an EOT. (Remember that you still have the detailed SubContract programme on your system to monitor progress)

The sections of the contract dealing with Employers own Contractors will cover your EOT.

Good luck & Best regards

Mike Testro

Hi Testro
Thanks for your reply.

I agree with you. We have no choice but to build a claim on the Law of the Land. But, would it be a claim or litigation?

Hi Sajid

Whatever cannot be recovered under the contract falls into litigation. It would have to be a substantial ammount to justify legal action.

Open up all the heads of claim allowed in the contract and maximise them all.

Keep a weekly rolling EOT claim and costs as the work proceeds.

Keep the threat of legal action open during all meetings and negotiations.

If you are still a lot short under the contract then you can - albeit reluctantly - go to law.

Best regards

Best regards

Mike Testro