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Subcontractor submitts an EOT Claim direct to the Engineer

5 replies [Last post]
Fri, 2012-06-29 20:49
Tanveer Ahmad Niazi
User offline. Last seen 6 years 4 weeks ago. Offline
Joined: 15 Dec 2005
Posts: 151
Groups: GPC Qatar
  1. The overall delay of the project is 95 days (including civil, architectural works, external works and MEP). The client is using FIDIC 1999.
  2. Prior to MEP activities started the project was delayed by 13 days.
  3. The major event occurred when the MEP contractor started chilled water piping 21 days later then the planned date.
  4. The main contractor rejected the EOT claim submitted by the MEP contractor due to various valid reasons.
  5. The EOT claim of the MEP contractor was based on the late approvals of the drawings and material submittals. Which was actually delayed by the large number (R0 to R15) of reviews of the drawings and material submittals.
  6. The MEP contractor forwarded the same claim to the Engineer.
  7. The Engineer suggested penalty of 82 days on the MEP contractor, considering 13 days delay by the main contractor while the MEP contractor was responsible for the rest of 82 days.
  8. The Engineer also suggested a breach of contract penalty on the MEP contractor considering 7 activities were started late and pushed the contractual finish date by 82 days later then the contractual finish dated.

Can anyone tell me?

  1. Can an on-board subcontractor forward or submit any claim directly to the Engineer or the Employer?
  2. If the Engineer’s decision was right?
  3. Did it happen anywhere before?

 

Cheers

Tanveer

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Replies

Sun, 2012-07-01 03:53
#1
Tanveer Ahmad Niazi
User offline. Last seen 6 years 4 weeks ago. Offline
Joined: 15 Dec 2005
Posts: 151
Groups: GPC Qatar

Thanx Mr. Testro I will read the subcontract agreemenr again and will come back to you. Thank you very musch

Cheers

tanveer

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Sat, 2012-06-30 16:43
#2
Mike Testro
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Joined: 14 Dec 2005
Posts: 4418
Groups: Building Information Modelling, Content Moderators, GPCCAR Editors

Hi Tanveer

If your sub-contractor is causing you delays then you the contractor will be subject to LAD's from the employer.

From this point on your recovery from the sub-contractor depends entirely on what the sub-contract says.

If there is a LAD clause in the sub-contract then all that you can recover from the Sub-contractor is the agreed amount for each day. You cannot get paid your own costs.

It is therefore essential that you read and understand the sub-contract - they often limit any liability to a percentage of the contract sum.

It is possible that the contractor may be facing large losses and cannot get it all back from the sub-contractor.

Come back if you need further input after you have read the sub-contract.

Best regards

Mike Testro

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Sat, 2012-06-30 13:07
#3
Tanveer Ahmad Niazi
User offline. Last seen 6 years 4 weeks ago. Offline
Joined: 15 Dec 2005
Posts: 151
Groups: GPC Qatar

Dear Mr. Testro

Thank you very much, but i have some more questions;

I am with the main contractor. I think I did not mention it clear that the Engineer did not reply to the subcontractor, but he suggested us (the main contractor). We just rejected the subcontractor’s ECT request and did not impose any penalty.

 

  1. As far as my analysis is concerned, the MEP subcontractor is responsible for the delays of 82 days. We (the main contractor) as far as the finishing work are concerned we followed the MEP subcontractor, which was delayed due to the MEP work.
  2. In the current condition, as you said the Engineer’s decision is not correct, what if the Engineer or the Employer imposes delay penalty on us (the main contractor?
  3. Can we impose penalty of 82 days on the subcontractor i9n that case?
  4. In lines 10 & 11 of your reply to my post, dated 2012-04-28, title “DELAY or BREACH OF CONTRACT” you wrote “If the contractor misses the task dates it is a technical breach of contract but only becomes an effective breach it the completion date is affected”. Now in this case the finish date is shifted 82 days way from its contractual date. Hence it is a breach of contract (in my view as per your words).
  5. The project was 13 days delay before the MEP delay but no civil /structure work activity was started late; delay was due to slow progress. Do you think that the breach of contract penalty cannot be imposed on the subcontractor because the finish date had already shifted?

Cheers

Tanveer

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Fri, 2012-06-29 22:39
#4
Christopher Hall
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Mike/ Tanveer,

I've seen this once before, it wasn't a standard form of contract.  Legal from both parities confirmed the subcontractor could be construed to be party to the head contract hence the subcontractor submitted claim directly to the principal/ employer.  The claim was assessed and settled excl. head contractor.

Regards,

Chris Hall

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Fri, 2012-06-29 21:00
#5
Mike Testro
User offline. Last seen 5 weeks 5 days ago. Offline
Joined: 14 Dec 2005
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Groups: Building Information Modelling, Content Moderators, GPCCAR Editors

Hi Tanveer

1. No

2. No

3. Not that I have heard

Best regards

Mike Testro

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