13. Variations and Adjustments 13.1 Right to Vary

1. Construction Contract AdministrationPresentation of chapter 13 at FIDIC(Variations and Adjustments )Prepared By : Jomah M. AL-NajjarInstructor : Dr. Kamalain K. ShaatSpring 2006

2.  13. Variations and Adjustments 13.1 Right to Vary *Variations may be initiated by the Engineer at any time prior to issuing the Taking – Over Certificate for the Works. *The Contractor shall execute and be bound by each Variations, unless the Contractor promptly gives notice to the Engineer stating that the Contractor cannot readily obtain the Goods required for the Variation. Upon receiving this notice, the Engineer shall cancel, confirm or vary the instruction. FIDIC

3. 13 /2 الهندسة القيمية:”Value Engineering” يمكن للمقاول في أي وقت أن يقدم إلى المهندس اقتراحاً خطياً، يعرض فيه رأيه، الذي إن تم اعتماده، فإنه: 1- يعجل في انجاز الأشغال، 2- يخفض قيمة الأشغال(لمصلحة صاحب العمل) فيما يخص عمليات التنفيذ أو صيانة أو تشغيل الأشغال، أو 3- يحسن من فاعلية أو قيمة الأشغال المنجزة لما فيه مصلحة صاحب العمل، أو 4- أنه يحقق منفعة أخرى لصاحب العمل . يتعين أن يتم اعداد الاقتراح على حساب المقاول، وأن يكون مستوفياً لمتطلبات اجراء التغييرات المحددة في المادة(13/3)لاحقاً. FIDIC

4. *إذا اشتمل عرض المقاول ، الذي تتم موافقة المهندس عليه، تعديلاً على تصميم أي جزء من الأشغال الدائمة، فإنه يتعين القيام بما يلي(إلا إذا اتفق الفريقان على غير ذلك): أ- أن يقوم المقاول بإعداد تصميم هذا الجزء، و ب- تطبق عليه أحكام الفقرات (4/1-أ،ب،ج،د)المتعلقة بالتزامات المقاول العامة،و ج- إذا ترتب على هذا التعديل تخفيض في قيمة العقد لهذا الجزء ، فإنه يتعين على المهندس، عملاً بأحكام المادة (3/5) أن يقوم بالاتفاق عليه أو تقدير بدل الأتعاب المترتب على تعديل التصميم لتضمينه في قيمة العقد. FIDIC

5. *ويكون هذا البديل مساوياً لـ (50%) من الفرق بين المبلغين التاليين: (1) التخفيض المتحقق في قيمة العقد لهذا الجزء، مما هم ناتج عن التعديل، باستثناء التعديلات بسبب تغيير التشريعات بموجب المادة(13/7)، والتعديلات بسبب تغير التكاليف بموجب المادة(13/8)، و (2) النقص الحاصل (إن وجد) في قيمة تلك الأجزاء المغيرة بالنسبة لصاحب العمل، مأخوذاً في الاعتبار أي نقص في النوعية أو العمر المتوقع أو الفاعلية التشغيلية. *إلا أنه إذا وجد أن قيمة (1) تقل عن قيمة (2)، فعندها لا يحتسب أي بدل للأتعاب. FIDIC

6. 13.3 Variations Procedure If the Engineer requests a proposal, prior instructing a Variation, the Contractor shall respond in writing as soon as practicable, either by giving reasons why he cannot comply or by submitting: a* A description of the proposed work to be performed and a programme for it’s execution; b* The Contractor's proposal for any necessary modifications to the programme according to Sub-Clause 8.3 {Programme} and to the time for completion, and; C* The Contractor’s proposal for evaluation of the Variation.  FIDIC

7. * The Engineer shall, as soon as practicable after receiving such proposal (under Sub-Clause 13.2 {Value Engineering} or other wise), respond with approval, disapproval or comments. The Contractor shall not delay any work whilst awaiting a response. * Each instruction to execute a Variation, with any requirements for the recording of costs, shall be issued by the Engineer to the Contractor, who shall acknowledge receipt.  FIDIC

8.  *Each Variation shall be evaluated in accordance with Clause 12{Measurement and Evaluation}, unless the Engineer instructs or approves otherwise in accordance with this Clause. 13.4 Payment in Applicable Currencies If the Contract provides for payment of the Contract Price in more than one currency, then whenever an adjustment is agreed, approved or determined as stated above, the amount payable in each of the applicable currencies shall be specified. FIDIC

9. 13.5 Provisional Sums Each Provisional Sum shall only be used, in whole or in part, in accordance with the Engineer’s instructions, and the Contract Price shall be adjusted accordingly. The total sum paid to the Contractor shall include only such amounts, for the work, supplies or services to which the Provisional Sum relates, as the Engineer shall have instructed. For each Provisional Sum, the Engineer may instruct: a* Work to be executed (including Plant, Materials or services to be supplied) by the Contractor; FIDIC

10. b*Plant. Materials or services to be purchased by the Contractor, from a nominated Subcontractor; and for which there shall be included in the Contract Price: (i) The actual amounts paid by the Contractor, and; (ii) A sum for overhead charges and profit, calculated as a percentages of these actual amounts by applying the relevant percentage rate (if any) stated in the appropriate Schedule. If there is no such rate, the percentage rate stated in the Appendix to Tender shall be applied. FIDIC

11. *The Contractor shall, produce quotations, invoices, vouchers and accounts or receipts in substantiation. 13.6 Day work For work of a minor or incidental nature, the Engineer may instruct that a Variation shall be executed on a day work basis. The work shall then be valued in accordance with the day work Schedule included in the Contract, Before Ordering Goods for the work, the Contractor shall submit quotations to the Engineer. When applying for payment, the Contractor shall submit invoices, vouchers and accounts or receipts for any Goods. FIDIC

12. *The Contractor shall deliver each day to the Engineer accurate statements in duplicate which shall include the following details of the resources used in executing the previous day’s work: a* The names, occupations and time of Contractor’s Personnel; b* The identification, type and time of Contractor’s Equipment and Temporary Works, and; FIDIC

13. c*The quantities and types of Plant and Materials used. *One copy of each statements will, if correct, or when agreed, be signed by the Engineer and returned to the Contractor. 13.7 Adjustments for Legislation The Contract Price shall be adjusted to take account of any increase or decrease in Changes in Cost resulting from a change in the Laws of the Country (including the introduction of new Laws and the repeal or modification of existing Laws). or in the judicial or official governmental interpretation of such Laws, made after the Base Date, which affect the Contractor in the performance of obligations under the Contract. FIDIC

14. *If the Contractor suffers delay and/or incurs additional Cost as a result of these changes in the Laws, the Contractor shall give notice to the Engineer and shall be entitled subject to Sub-Clause 20.1 {Contractor’s Claims) to: a* An extension of time for any such delay, if completion is or will be delayed; b* Payment of any such cost, which shall be included in the Contract Price. After receiving this notice, the Engineer shall proceed in accordance with Sub Clause 3.5 {Determinations} to agree or determine these matters. FIDIC

15. 13.8 Adjustments for Changes in Cost *In this Sub-Clause, “table of adjustment data” means the completed table of adjustment data included in the Appendix to Tender. If there is no such table of adjustment data, this Sub-Clause shall not apply. *If this Sub-Clause applies, the amounts payable to the Contractor shall be adjusted for rises or falls in the cost of labour, Goods and other inputs to the works, by the addition or deduction of the amounts determined by the formulae prescribed in this Sub-Clause. For any rise or fall in costs is not covered by the provisions of this or other Clauses, the Accepted Contract Amount shall be deemed to have included amounts to cover the contingency of other rises and falls in costs. FIDIC

16. The adjustment to be applied to the amount otherwise payable to the Contractor, by the formula shall be of the following general type: Pn = a + b (Ln / Lo) + c (En / Eo) + d (Mn / Mo) + …. * “Pn” is the adjustment multiplier to be applied to the estimated contract value. * “a” is a fixed coefficient, representing the non-adjustable portion in contractual payments; * “b”, “c”, “d”,… are coefficients representing the estimated proportion of each cost element related to the execution of the works, as stated in the relevant table of adjustment data; cost elements. FIDIC

17. *“Ln’, “En”, “Mn”, … are the current cost indices or reference prices for period ‘n’ expressed in the relevant currency of payment, * “Lo”, “Eo”, “Mo”,… are the base cost indices or reference prices, expressed in the relevant currency of payment, each of which is applicable to the relevant tabulated cost element on the Base Date. *The cost indices or reference prices stated in the table of adjustment data shall be used. If their source is in doubt, it shall be determined by the Engineer. FIDIC

18. *In cases where the “currency of index” (stated in the table) is not the relevant currency of payment, each index shall be converted into the relevant currency of payment at the selling rate, established by the central bank of the Country, *Until such time as each current cost index is available, the Engineer shall determine a provisional index for the issue of interim Payment Certificates. FIDIC

19. *If the Contractor fails to complete the works within the time for completion, adjustment of prices thereafter shall be made using either : (i) Each index or price applicable on the date 49 days prior to the expiry of the time for completion of the works; (ii) The current index or price: whichever is more favorable to the Employer. FIDIC

20. * The weightings (coefficients) for each of the factors of cost stated in the table (s) of adjustment data shall only be adjusted if they have been rendered unreasonable, unbalanced or inapplicable, as a result of Variations. Thank You {وكل عام وأنتم بخير} FIDIC