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Construction contracts

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A variation on the owner’ s end may also be required if construction procedures are to be changed. For example, the owner may request the contractor to accelerate or slow down construction progress. Similarly, the owner may request the contractor to adopt different construction practices such as using the different technology that is available to the contractor. In any case, such changes would require a variation of already established procedures and their application. In this instance, it is noticeable that subclause 13.3 of the FIDIC Red Book (1999) does not provide coverage to the contractor for any such changes.

In contrast, the owner’ s engineer has been provided with the privileges to decide on work procedures as referred to clause 12 under subclause 13.3. This tends to expose the contractor who has no other option but to reject the proposed changes by the engineer. In such a case, the possibility of a dispute between the owner and the contractor is high since no other means of settlement are provided. Consultant RelatedConsultant related changes, especially with respect to design enhancement, are commonplace. This is all the more true for projects where construction commences before the design has been finalized.

Changes in design initiated by the consultant may have mixed effects for the overall project depending on when the changes are proposed. In case that the changes are proposed earlier on in the project, the amount of variation is understandably low and hence a variation clause as per FIDIC Red Book (1999) subclause 13.3 could be used for settlement. However, in case that the design changes are introduced later on such as the addition of new features to an already constructed floor, the variations would be more disputable.

In such a case, there are chances for disputes to arise. Moreover, such variations would automatically lead to losses in productivity and negative schedule variances.

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