Contracts and payment
FIDIC contract review checklist for contractors
Published:
The clauses to read first in a FIDIC Red Book contract: notices and claims, variations, payment, time, and the Particular Conditions that change them.
Original checklist. Clause numbers refer to the FIDIC Conditions of Contract for Construction (Red Book), 2017 edition; your edition and Particular Conditions govern. It is not legal advice.
Start with the Particular Conditions
The General Conditions are FIDIC’s standard text; the Particular Conditions change them for each project. Read the Particular Conditions first and mark every sub-clause they amend: that is where your contract’s allocation of risk departs from the standard.
Notices and claims
Under Sub-Clause 20.2 of the 2017 edition, a party that considers itself entitled to more time or money must give notice no later than 28 days after it became aware, or should have become aware, of the event. A late notice can lose the claim. Keep a register of notices from the first day on site.
Variations
Clause 13 sets out how the Engineer instructs a variation and how it is valued. Check who may instruct, whether a proposal is required first, and which rates apply: contract rates, adjusted rates or new rates.
Payment
Clause 14 covers the advance payment, applications for interim payment, the Engineer’s payment certificates and the time for payment. Note every time limit in the Contract Data and the Particular Conditions, together with retention and the currencies of payment.
Time and delay
Clause 8 covers commencement, the programme, extension of time and delay damages. Check what the programme must contain, the grounds for an extension of time and any cap on delay damages.
A short checklist
Before signing or pricing a FIDIC contract:
- List every notice period and who must receive each notice.
- Note the retention percentage, the advance payment and how it is recovered.
- Check the limit of liability and the cap on delay damages.
- Identify the dispute route: the Dispute Avoidance/Adjudication Board, then arbitration.
- Record each Particular Condition that moves risk to the contractor.