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NEW QUESTION # 19
Which one statement regarding the adjustment of the Contract Price as mentioned in Sub-Clause 13.8 of FIDIC Silver Book (edition 1999) is correct?
- A. If Particular Conditions provide a calculation method or refer to a specific set of index for adjustments following Sub-Clause 13.8, it can only apply to rises or falls in the costs of labour and Goods.
- B. The Particular Conditions can provide a calculation method or refer to a specific set of index for adjustments following Sub-Clause 13.8. Only the Base Date can be taken as the date from which the adjustment should be calculated from.
- C. The Particular Conditions can provide a calculation method or refer to a specific set of index for adjustments following Sub-Clause 13.8. This can result in lower adjustments of the Contract Price than the actual changes in the costs of labour and/or Goods.
- D. If the Contract Price is to be adjusted for rises and falls in the cost of labour, the Contractor is entitled to compensation in such a way that all rises and falls in the costs are compensated fully.
Answer: C
Explanation:
Sub-Clause 13.8 of the FIDIC Silver Book (1999) allows the Particular Conditions to specify a formula or indices for adjusting the Contract Price for rises and falls in labour and Goods costs. The method set forth may not fully compensate for actual cost changes - it can be lower than the real fluctuations - reflecting practical and commercial considerations.
Option B is correct because the contract permits this flexibility.
Option A is incorrect; full compensation is not guaranteed.
Option C is incorrect; the adjustment can cover materials and labour but may extend beyond.
Option D is incorrect; adjustments can be calculated from different dates as specified.
References:
FIDIC Silver Book 1999 Edition, Sub-Clause 13.8 - Adjustments for Changes in Cost FIDIC Contract Manager Study Guide, Module on Payment Adjustments
NEW QUESTION # 20
Under the FIDIC Yellow Book (both editions), the Contract is administered by the Employer (unless it appoints an Employer's Representative) who endeavours to reach agreement with the Contractor on each claim. Is this statement true or false?
- A. False
- B. True
Answer: B
Explanation:
Comprehensive and Detailed Explanation:
This statement is true. The Employer administers the contract unless an Employer's Representative or Engineer is appointed to act on its behalf. The Employer (or its Representative) is responsible for reviewing and negotiating claims in good faith with the Contractor to reach agreement, in line with FIDIC procedures.
References:
FIDIC Yellow Book 1999 & 2017 Editions, Clause 3 - Employer's Administration Role FIDIC Contract Manager Study Guide, Module on Contract Administration
NEW QUESTION # 21
If defects are identified during the Tests on Completion, which one of the following options is not available to the Parties under the Contract?
- A. If the defects do not affect the use of the Works for their intended purpose, the Engineer can issue the Taking-Over Certificate.
- B. The Party which is not liable for the cost of rectifying defects can expect the other Party to pay the cost of performing the repeated tests.
- C. By giving reasons, the Engineer can refuse to accept the Works until repeated tests have been successfully performed.
- D. The Employer can request to take over the Works.
Answer: B
Explanation:
Under FIDIC contracts, when defects are identified during Tests on Completion, the Engineer may still issue the Taking-Over Certificate if the defects do not materially affect the intended use (Option A). The Engineer can refuse acceptance until defects are rectified and tests repeated (Option B). The Employer can also request to take over the works (Option C).
However, Option D is not a standard contractual provision; the contract does not stipulate that the Party not liable for rectifying defects is entitled to payment for repeated tests. Typically, costs of repeated tests due to defects are borne by the liable party.
References:
FIDIC Red, Yellow, and Silver Books, Sub-Clause 10.1 and 10.3 - Taking Over and Tests on Completion FIDIC Contract Manager Study Guide, Module on Project Close-Out and Defects
NEW QUESTION # 22
Which two statements are correct regarding the FIDIC Red Book (edition 2017)?
- A. Words and expressions stated in Sub-Clause 1.1 Definitions do not apply in respect of Specifications and Drawings.
- B. In some cases, if a certain information is not provided in the Contract Data, the relevant Sub-Clause shall not be applicable.
- C. Contract Data contains information which is required by certain Sub-Clauses in the General Conditions.
- D. There is never a difference in effect whether in the Particular Conditions when the term "Works" is used, or when the term "works" is used.
Answer: B,C
Explanation:
Comprehensive and Detailed Explanation:
Option B is correct: The Contract Data provides information required by specific Sub-Clauses in the General Conditions to complete the contract.
Option D is correct: If required data is missing in the Contract Data, some Sub-Clauses may not apply.
Option A is incorrect; definitions generally apply throughout the contract including Specifications and Drawings.
Option C is incorrect; case sensitivity of terms can affect contractual meaning.
References:
FIDIC Red Book 2017 Edition, Sub-Clause 1.1 - Definitions and Contract Data FIDIC Contract Manager Study Guide, Module on Contract Documents
NEW QUESTION # 23
Which of the following FIDIC contract forms require certification in the payment process? (2 correct answers apply) Choose all of the correct answers (multiple possibilities).
- A. FIDIC Conditions of Contract for Plant and Design Build ("Yellow Book").
- B. FIDIC Conditions of Contract for Construction ("Red Book").
- C. FIDIC Conditions of Contract for EPC/Turnkey Projects ("Silver Book").
Answer: A,B
Explanation:
Comprehensive and Detailed Explanation:
Options A and B are correct: Both the Red and Yellow Books require the Engineer to certify payments before the Employer pays the Contractor.
Option C (Silver Book) typically places the risk on the Contractor and often provides for payment without Engineer certification, reflecting the turnkey nature of the contract.
References:
FIDIC Red and Yellow Books 1999 & 2017 Editions, Clauses on Payment Certification FIDIC Silver Book 1999 & 2017 Editions - Payment Provisions FIDIC Contract Manager Study Guide, Module on Payment Procedures
NEW QUESTION # 24
Which one of the following is not a required document to be submitted by the Contractor if the Employer requests a proposal, prior to instructing a Variation, for FIDIC 2017 Yellow Book?
- A. A description of the varied work.
- B. Details of the resources and methods to be adopted by the Contractor.
- C. A Programme for execution of the varied work.
- D. A description of the proposed design.
Answer: D
Explanation:
When the Employer requests a proposal prior to instructing a Variation, the Contractor is typically required to submit:
A description of the varied work (Option A).
Details of resources and methods for carrying out the Variation (Option C).
A Programme showing how the Variation will be executed (Option D).
A description of the proposed design (Option B) is not always required as part of the Variation proposal, especially if the Variation is limited to changes in execution rather than design.
References:
FIDIC Yellow Book 2017 Edition, Sub-Clause 3.4 - Variation Procedure
FIDIC Contract Manager Study Guide, Module on Variations and Change Management
NEW QUESTION # 25
Which of the following obligations are relevant to the Engineer's roles with regards to insurance? [2017 Edition] (2 correct answers apply) Choose all of the correct answers (multiple possibilities).
- A. The Engineer is entitled to take out an insurance on behalf of the Contractor, in case the Contractor fails to extend the validity of a specific insurance.
- B. The Engineer shall receive a copy of the evidence(s) demonstrating Contractor's payment of the necessary insurance premiums.
- C. The Engineer shall immediately suspend all construction activities at the Site, in case the Contractor failed to take out any necessary insurance.
- D. The Engineer should continuously monitor that the Contractor's insurance policies are kept valid, and extensions are duly arranged, when necessary.
Answer: B,D
Explanation:
Comprehensive and Detailed Explanation:
Option A is correct: The Engineer is entitled to receive evidence that the Contractor has paid for the necessary insurance policies.
Option C is correct: The Engineer has the role of monitoring the validity of these insurances and ensuring that renewals or extensions are arranged in a timely manner.
Option B is incorrect; the Engineer does not have the authority to take out insurance on behalf of the Contractor.
Option D is incorrect; suspension of construction activities is not automatically the Engineer's role for insurance lapses but may require instructions from the Employer.
References:
FIDIC Red, Yellow, Silver Books 2017 Edition, Sub-Clause 18 - Insurances FIDIC Contract Manager Study Guide, Module on Contract Administration and Insurance
NEW QUESTION # 26
Under the FIDIC Red Book (edition 1999): the Contractor submitted Final Statement in accordance with the Contract and the Contractor wants to correct it. Can the Contractor correct the Final Statement?
- A. Yes
- B. No
Answer: A
Explanation:
According to the FIDIC Red Book 1999,Sub-Clause 14.10 - Application for Final Payment Certificateand related procedures allow the Contractor to submit the Final Statement, which includes the final account of all sums due.
If after submission the Contractor identifies errors or omissions in the Final Statement, the Contractor is generally entitled tosubmit corrections or adjustmentsto that statement before the issuance of the Final Payment Certificate. This ensures that the final account accurately reflects all amounts due.
The Engineer reviews the Final Statement and may seek clarifications or adjustments. The contract typically allows the Contractor to correct or revise the Final Statement as part of this review process.
However, once the Final Payment Certificate is issued and accepted by the parties, it becomes more difficult for the Contractor to amend the Final Statement without formal agreement or dispute resolution.
Hence, prior to certification, the Contractor can correct the Final Statement.
References:
FIDIC Red Book 1999 Edition, Sub-Clause 14.10 - Application for Final Payment Certificate FIDIC Contract Manager Study Guide, Module on Contract Administration Procedures
NEW QUESTION # 27
You are the Contract Manager of the Engineer for a contract using FIDIC Yellow Book (edition 2017). You are drafting a notice holding the Commencement Date. Which one of the following approaches has the most clear and unambiguous drafting?
- A. The commencement date of this project under Sub-Clause 8.1 of the Conditions of Contract will be 10 days from 7 April 2023.
- B. I hereby give notice, in accordance with Sub-Clause 8.1 of the Conditions of Contract, the Commencement Date shall be 17 April 2023.
- C. I hereby give notice, in accordance with Sub-Clause 1.1.84 and 8.2 of the Conditions of Contract, that the Time for Completion shall commence from 17 April 2023.
- D. The Contractor is kindly notified that the project shall be started by 17 April 2023.
Answer: B
Explanation:
Option A provides the clearest and most unambiguous notice because:
It explicitly references the relevant Sub-Clause (8.1) that governs Commencement Date notification.
It uses precise language "I hereby give notice" indicating formal notification.
It clearly states the Commencement Date with a specific date (17 April 2023).
Options B and C are less formal or ambiguous and do not refer to the proper contract clause, which could lead to disputes. Option D incorrectly refers to the Time for Completion start rather than the Commencement Date specifically.
Clear and formal notices help prevent contractual disputes by explicitly identifying the contractual clause and key date.
References:
FIDIC Yellow Book 2017 Edition, Sub-Clause 8.1 - Commencement of Works
FIDIC Contract Manager Study Guide, Module on Contract Formation and Execution
NEW QUESTION # 28
Choose which one statement consists of an example of an unclear and ambiguously drafted Particular Conditions.
- A. All deletions of a General Conditions are replaced with new Particular Conditions that cover the same scope.
- B. Provisions of the General Conditions are deleted and replaced in the Particular Conditions solely by the words "not used".
- C. Clarifications to the meaning of tender documents together with answers to tenderers' inquiries made during the tender period by the Employer should be e-mailed in a Excel table in both PDF and XLS file format.
- D. The clarifications to the Contract given during the tender period are never to be attached to the Contract, as such clarifications are reflected by amending the Particular Conditions.
Answer: B
Explanation:
The use of vague phrases such as "not used" in Particular Conditions to delete provisions of the General Conditions without replacement or explanation leads to ambiguity and unclear contractual obligations. Such drafting can cause confusion as it fails to clarify whether the deleted provisions are simply not applicable or replaced by other terms. This practice is discouraged because it creates legal uncertainty and possible disputes regarding the rights and responsibilities of the parties.
Option A exemplifies this problem, as it deletes General Conditions clauses without specifying alternatives or clarifications.
Option B is a good practice where deletions are replaced by well-defined clauses to maintain contract balance.
Option C describes a clear method of issuing clarifications, promoting transparency and traceability.
Option D is consistent with standard practice, where clarifications during tender are formalized by contract amendments.
References:
FIDIC Contract Manager Study Guide, Module on Contract Administration Procedures and Particular Conditions drafting FIDIC Red Book 2017 Guide notes on drafting Particular Conditions
NEW QUESTION # 29
A large sewage pump installation has been constructed under the FIDIC Yellow Book (edition 1999). Prior to commencement of the Tests on Completion, the Employer requires the Contractor to issue the Operation and Maintained Manuals. All contract documents are to be drafted in the English language as per Sub-Clause 1.4.
However, the Employer discovers all documents are drafted in a different language: French. The Contractor explains that the territory where the Plant was constructed is a region with French as a second official language, as result of which, this approach is acceptable. This also works for the proposed maintenance company, which is Paris-based. The Employer is surprised and asks you what to do. Select the best fitting advice you should give the Employer.
- A. If French is indeed an official second language of the region where the Plant is built, the Contractor is entitled to deliver the documents in French. The usability in terms of language is not described in Sub- Clause 5.7, so the Employer should accept the Operation and Mantained Manuals in French.
- B. As the Contract is written in the English language, Sub-Clause 1.4 dictates that the Operation and Maintenance Manuals should be written in English as well.
- C. The Employer should check on the Appendix to Tender, Employer's Requirements and / or Particular Conditions. There could very well be specific requirements regarding the language in those. If that is not the case, the language of the Contract determined in Sub-Clause 1.4 and the language of the Operation and Maintained Manuals should in this case be English.
- D. Golden Principle no. 1 states: The duties, rights, obligations, roles and responsibilities of all the Contract Participants must be generally as implied in the General Conditions, and appropriate to the requirements of the project. In this case this means it is appropriate that the Operation and Maintenance Manuals are in French, as the maintenance is based in France.
Answer: C
Explanation:
The best advice is to verify specific contractual documents such as the Appendix to Tender, Employer's Requirements, and Particular Conditions, which may specify the required language for Operation and Maintenance Manuals. If no specific provision is made, the default language is that of the Contract as per Sub- Clause 1.4, which in this case is English.
Therefore, the Contractor is generally obliged to provide manuals in English unless otherwise specified.
Options B, C, and D are less comprehensive or may disregard contractual hierarchy or project-specific details.
References:
FIDIC Yellow Book 1999 Edition, Sub-Clause 1.4 - Language
FIDIC Yellow Book 1999 Edition, Sub-Clause 5.7 - Operation and Maintenance Manuals FIDIC Contract Manager Study Guide, Module on Contract Language and Documentation
NEW QUESTION # 30
Which one of the following statements is correct regarding the Provisional Sum under the FIDIC Red, Yellow, and Silver Books (edition 1999)?
- A. The Provisional Sum cannot be issued by instruction either by the Engineer (or Employer in case of FIDIC Silver Book).
- B. The Contractor shall, when required by the Engineer, produce proof to substantiate how it has used the Provisional Sum.
- C. Each Provisional Sum shall not be used, in whole or in part, in accordance with instructions from the Engineer.
Answer: B
Explanation:
Comprehensive and Detailed Explanation:
Option B is correct. Under FIDIC contracts, the Contractor must provide proof of how the Provisional Sum has been expended when requested by the Engineer. This ensures transparency and proper use of funds allocated as Provisional Sums.
Option A is incorrect; Provisional Sums are often used based on instructions from the Engineer or Employer.
Option C is incorrect because Provisional Sums are precisely intended to be used, in whole or in part, according to Engineer's or Employer's instructions.
References:
FIDIC Red, Yellow, and Silver Books 1999 Edition, Sub-Clause 13.2 - Provisional Sums FIDIC Contract Manager Study Guide, Module on Payment Procedures
NEW QUESTION # 31
What does discharge confirm under the FIDIC Red Book (edition 1999)?
- A. It confirms interim settlement of all money due to the Contractor
- B. None of the above three statements is correct.
- C. It confirms full and final settlement of all money due to the Contractor.
- D. It confirms the immediate end to the Contract unconditionally whenever issued.
Answer: C
Explanation:
Discharge under FIDIC Red Book 1999 confirms full and final settlement of all money due to the Contractor.
It signifies the Contractor's acceptance of the Final Payment Certificate and releases the Employer from further financial obligations related to the contract.
Options A and C misrepresent the nature of discharge.
Discharge is not a unilateral immediate termination but a financial closure.
References:
FIDIC Red Book 1999 Edition, Sub-Clause 14.13 - Discharge
FIDIC Contract Manager Study Guide, Module on Final Account and Discharge
NEW QUESTION # 32
Under the FIDIC Red Book (edition 2017), the Engineer has suspended works to come to a change of the design of a part of the Works. After expiry of 84 days of suspension, the Contractor gave notice thereof.
Following this notice, the suspension was not lifted within 28 days. What two statements are correct in such a situation?
- A. The Contractor may omit the affected part of Works and deny to carry out such Work going forward, but only after it has given a second notice to the Engineer.
- B. Under the Contract the Parties cannot agree on further suspension and the Contractor may immediately terminate the Contract if it affects the whole Works.
- C. The Contractor may terminate the Contract if it affects the whole Works, but only after it has given a second notice to the Engineer.
- D. The Contractor cannot terminate the Contract.
Answer: B,C
Explanation:
Under FIDIC Red Book 2017, if the Engineer suspends works for more than 84 days and the Contractor notifies the Engineer, but the suspension is not lifted within 28 days, the Contractor may terminate the contract if the suspension affects the whole of the Works (Option A).
Additionally, the Contractor must give a second notice before termination (Option C). This process ensures proper communication and adherence to contractual procedures.
Option B is incorrect; termination is allowed under specified conditions.
Option D is incorrect; omission of work is not generally permitted without formal termination.
References:
FIDIC Red Book 2017 Edition, Sub-Clause 8.9 - Suspension by Engineer
FIDIC Contract Manager Study Guide, Module on Suspension and Termination
NEW QUESTION # 33
Under the FIDIC Red and Yellow Books (edition 1999), which two of the following statements are correct regarding the issuance of Interim Payment by the Engineer?
(Choose all correct answers - multiple possibilities)
- A. If the Employer considers itself entitled to claim against the Contractor, notice and particulars must first be submitted under Sub-Clause 2.5. The Employer's entitlement is then to be agreed or determined by the Engineer, and then, incorporated as a deduction in a Payment Certificate.
- B. The Employer is not bound by the Certificate issued by the Engineer.
- C. The Employer is bound by the Certificate issued by the Engineer, and must make payment in full, except for any compensation arising from any claim which the Employer may have against the Contractor.
- D. The Employer is bound by the Certificate issued by the Engineer and must make payment in full, irrespective of any entitlement to compensation arising from any claim which the Employer may have against the Contractor.
Answer: A,C
Explanation:
Under the FIDIC Red Book and Yellow Book, 1999 editions, the Engineer issues Interim Payment Certificates certifying the amounts due to the Contractor for completed works and materials on site (Sub- Clause 14.6). The Employer is generally bound by the Payment Certificate and must pay accordingly, except where there is a lawful set-off or compensation claim against the Contractor.
Option A is correct because the Employer must pay the amount certified except for compensation claims that may be offset against the payment (Sub-Clause 14.6).
Option D is also correct: If the Employer intends to claim against the Contractor (e.g., for damages or defects), it must notify the Contractor under Sub-Clause 2.5 and provide particulars. The Engineer then assesses and decides on the claim and incorporates any agreed deductions into the Payment Certificate.
Option B is incorrect because the Employer is indeed bound by the Payment Certificate unless lawful deductions or disputes arise.
Option C is incorrect as the Employer can withhold amounts due for compensation claims once these are properly notified and substantiated.
References:
FIDIC Red and Yellow Books, 1999 Edition, Sub-Clause 14.6 - Interim Payments FIDIC Red and Yellow Books, 1999 Edition, Sub-Clause 2.5 - Employer's Claims FIDIC Contract Manager Study Guide, Module on Payment Procedures and Financial Management
NEW QUESTION # 34
Which of the following statements are relevant to continuing effect claims? [FIDIC 2017 Edition] (2 correct answers apply)
- A. In case the Contractor is the Claiming Party, when he/she misses to submit even just a single interim claim, then his/her entitlement is lost.
- B. Continuing effect claims shall be noticed in the same way as "normal" claims, within 28 days after the Claiming Party became aware of the event or circumstance.
- C. In general, a fully detailed Claim has to be submitted within 84 days after becoming aware of the event giving rise to the claim.
- D. In case the Employer is the Claiming Party, then he/she is not obliged to submit interim claims.
Answer: B,C
Explanation:
Comprehensive and Detailed Explanation:
Option A is correct: Continuing effect claims (claims where the event's impact continues over time) require notices like other claims, typically within 28 days of awareness.
Option D is correct: The fully detailed claim submission generally must be within 84 days of becoming aware of the event, allowing the Claiming Party to elaborate on the claim.
Option B is incorrect; Employer claims also require timely notification.
Option C is incorrect; missing a single interim claim does not necessarily result in losing entitlement if the contract allows for correction or continued claims.
References:
FIDIC Red, Yellow, and Silver Books 2017 Edition, Sub-Clause 20.1 - Claims and Notices FIDIC Contract Manager Study Guide, Module on Claims and Continuing Effects
NEW QUESTION # 35
Upon review of the revised programme, submitted by the Contractor, if the Engineer (under FIDIC Red or Yellow Books) or Employer (under FIDIC Silver Book) does not give a Notice of Non-Compliance within 14 days after receiving a revised programme, then ... [complete the sentence, thereby considering FIDIC Red, Yellow, and Silver Books (edition 2017)]. (1 correct answer applies)
- A. The Engineer shall be deemed to have given a Consent and the revised programme shall be the Programme.
- B. The Engineer is deemed to have no objection to use the revised programme submitted by the Contractor, for the Works.
- C. The Contractor shall submit a Notice to the Engineer or the Employer reminding him to give its approval on the revised programme.
- D. The Contractor cannot proceed in accordance with the Programme.
Answer: B
Explanation:
Comprehensive and Detailed Explanation:
According to the FIDIC 2017 editions (Red, Yellow, and Silver Books), when the Contractor submits a revised programme, the Engineer or Employer has a limited time (typically 14 days) to review and raise any Notice of Non-Compliance if the programme does not meet contract requirements (Sub-Clause 8.3 or equivalent). If no notice is issued within this period, the Engineer or Employer is deemed to have no objection to the revised programme.
This does not imply formal approval or consent, but the programme can be used for the execution and administration of the works in the absence of objections. This avoids unnecessary delay due to inaction.
Option D is correct as it captures this deemed "no objection" position.
Option B is incorrect as "deemed consent" is stronger than FIDIC provisions state; it is more correct to say
"no objection".
Option A is incorrect since the Contractor does not have to remind the Engineer or Employer for consent within this period.
Option C is incorrect because the Contractor may proceed if no non-compliance is notified.
References:
FIDIC Red Book 2017 Edition, Sub-Clause 8.3 - Programme
FIDIC Yellow Book 2017 Edition, Sub-Clause 8.3 - Programme
FIDIC Silver Book 2017 Edition, Sub-Clause 8.3 - Programme
FIDIC Contract Manager Study Guide, Module on Time and Delay Management
NEW QUESTION # 36
Which of the following form a Contractor's entitlement, in case the Contractor does not receive an interim payment within the allocated contractual deadline for payment? (2 correct answers apply) Choose all of the correct answers (multiple possibilities).
- A. If the payment is not made within the time period required, after the expiry of such period, from the next day onwards, the Contractor is entitled to suspend all his/her activities on Site.
- B. Right after the expiry of the payment deadline, the Contractor may terminate the contract.
- C. The Contractor is entitled to suspend the works or reduce the rate of progress of the work, after giving a due Notice (21 days) about this intention.
- D. In case the Employer paid the Contractor late, the Contractor becomes entitled to receive financing charges applying the % included in the Contract Data (if this is not stated, then applying the percentage as included under the corresponding Sub-Clause).
- E. Beyond receiving the financing charges, the Contractor has no further entitlements in such a case.
Answer: C,D
Explanation:
Option C is correct: The Contractor is entitled to financing charges (interest) on late payments, calculated as per the percentage specified in the Contract Data or corresponding Sub-Clause.
Option D is correct: The Contractor can suspend works or reduce progress after giving due notice, usually 21 days, if payments are not made on time.
Option A is incorrect; termination is not automatic right after the payment deadline expires.
Option B is incorrect; suspension requires prior notice rather than immediate action.
Option E is incorrect because the Contractor has additional remedies such as suspension, beyond just financing charges.
References:
FIDIC Red, Yellow, Silver Books 1999 & 2017 Editions, Sub-Clause 14.8 - Payment of Retention Money and Financing Charges FIDIC Contract Manager Study Guide, Module on Payment Procedures and Remedies
NEW QUESTION # 37
Which one of the following statements is NOT correct in respect of FIDIC Red Book (both editions)?
- A. The Letter of Tender may be worded by the Contractor (at its discretion) so as to allow for the alternative of the Contract to become effective when the Employer issues a Letter of Acceptance.
- B. The Contract is administered by the Engineer who is appointed by the Employer. If disputes arise, they are referred to a Dispute Adjudication Board (DAB) for its decisions.
- C. The General Conditions allocate the risks between the parties on a fair and equitable basis.
- D. The Contract typically becomes legally effective when the Employer issues the Letter of Acceptance to the Contractor.
Answer: A
Explanation:
Comprehensive and Detailed Explanation:
Option A is NOT correct because the wording of the Letter of Tender is usually governed by the tender documents and contract terms; it is not solely at the Contractor's discretion to dictate when the Contract becomes effective. The standard process is that the Contract becomes effective upon the Employer's issuance of the Letter of Acceptance.
Options B, C, and D correctly describe standard FIDIC practices.
References:
FIDIC Red Book 1999 & 2017 Editions - Contract Formation and Tendering
FIDIC Contract Manager Study Guide, Module on Contract Formation
NEW QUESTION # 38
Under the FIDIC Red Book (edition 1999), as part of the Contractor submission of Statement, any amount to be deducted for retention, will be calculated by applying the percentage of retention stated in the Appendix to Tender to the total of: (two correct answers apply) Choose all of the correct answers (multiple possibilities).
- A. Any amounts to be added and deducted for changes in legislation and changes in cost.
- B. Any amounts to be added and deducted for Plant and Materials in accordance with Sub-Clause 14.5.
- C. Any amounts to be added and/or deducted for the advance payment and repayments under Sub-Clause
14.2. - D. The estimated contract value of the Works executed.
Answer: B,D
Explanation:
Under FIDIC Red Book 1999, retention is calculated as a percentage (stated in Appendix to Tender) of the value of Works executed and Plant and Materials in accordance with Sub-Clause 14.5 that are on or off Site but intended for incorporation.
Option A is correct: Retention applies to the value of executed works.
Option D is correct: It also applies to Plant and Materials under Sub-Clause 14.5.
Option B is incorrect; advance payments and repayments are not part of retention calculations.
Option C is incorrect; changes due to legislation or costs are not included in retention calculation.
References:
FIDIC Red Book 1999 Edition, Sub-Clause 14.5 - Plant and Materials; Sub-Clause 14.6 - Retention FIDIC Contract Manager Study Guide, Module on Payment and Retention Procedures
NEW QUESTION # 39
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