THE FIDIC 'ORANGE BOOK

AN INTRODUCTION TO
THE FIDIC ORANGE BOOK

THE ROLE OF THE EMPLOYER'S

REPRESENTATIVE

THE OBLIGATIONS OF THE

CONTRACTOR

ANDREW HIBBERT and

AGNE SANDBERG
 FIDIC CONDITIONS OF CONTRACT
FOR DESIGN BUILD AND TURNKEY
INTRODUCTION TO THE ORANGE BOOK

by
ANDREW mBBERT

Partner, Masons Solicitors

Presented 11/13 November 1996 - Vienna

MASONS

Solicitors
& Privy Council Agents
 INTRODUCTION TO THE FIDIC ORANGE BOOK

CONTENTS

The need for and purpose of the Orange Book

The main features of the Orange Book

The parties responsible for the administration of the Orange Book

The role of the Employer's Representative

The role of the Employer

The Obligations of the Contractor

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Introduction to the Orange Bock CMasons
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 1. THE NEED FOR AND PURPOSE OF THE ORANGE BOOK

INTRODUCTION

and are not new, and not specific to

international construction. Design-build contracts are sometimes called
"package deal contracts" and the distinguishing feature of this type of
contracting regime - as distinct from the more traditional regime - is that the
client has one party to look to

A turnkey contract also involves the client contracting with an entity who
agrees however, the essence of a
turnkey contract is that by way of
the completed proj ecf'HBtt'ttB' 'Btteflfr^does-. .--sot'- appear on the '-scene^tgStti until
the contractor has completed the project - and metaphorically hands the owner
the key for the owner to insert in the lock to turn it.

The term "turnkey" originated in the building and the oil and gas industries in
the United States, then spread to other types of project and other countries.
Today the term tends to be or
"package deal".

ADVANTAGES OF DESIGN-BUILD/TURNKEY

Design-build/tumkey contracts are growing in popularity throughout the

World. This is primarily because of the advantages of
as compared with

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 the complex risk sharing between the client, the contractor and the
engineer/architect which arises under a more traditional contracting regime.
There are also advantages with regard to speed and sequence of work under a
design-build/turnkey contracting regime.

In design-build/turnkey contracts it is essential that

For the unsophisticated client this may be
perceived to be a disadvantage of this contracting regime. Likewis

ROLEOFFIDIC

Although most countries have domestic forms of design-build/turnkey contracts

- eg, in the UK the JCT 1981 with Contractor's Design and the ICE Design and
Construct Conditions of Contract - prior to the Orange Book there was no
design-build/tumkey standard form contract for use internationally.

Over the years, FIDIC forms - in particular the Red Book - have been amended
on a project by project basis; however this is a complex task and in practice
very difficult to achieve successfully. This is perhaps not surprising when one
bears in mind that such a task involves turning a contract prepared on the basis
^^*^*"*^>A"*
Ihat^lfc^
remeasurement basis mto a contract where me works are fully designed by the
contractor and paid for on a lump sum basis.

In response to growing pressure for an international design-build/tumkey

contract FIDIC began the preparation of the Orange Book in 1991. The so

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Introduction to the Orange Book CMasons
Andrew Hibbert, Partner, Masons
 called "Test Edition" was produced in December 1994. Thereafter, following a )
period of consultation based on the Test Edition, the FIDIC Orange Book, First
Edition, was published in June 1995.

2. THE MAIN FEATURES OF THE ORANGE BOOK

INTRODUCTION

A cursory examination of the new contract reveals that much of the "look and
feel" of the Red and Yellow Books has been transferred across. Furthermore, -~
in overall terms the structure of the Orange Book is similar to the other
contracts, even though the approach to paragraph numbering has been
substantially changed. It must be said, however, that no significant reduction
in overall length has been achieved compared with the Red and Yellow Book;
the clauses in the Orange Book contain many ^ub-clauses and individual sub-
clauses are in general much longer than many of the equivalent provisions in
the Red and Yellow Books.

OVERALL STRUCTURE AND CONTENT

Despite its overall length it is generally much easier to gain a familiarity with
the overall structure and content of the Orange Book than with, for example,
the Red Book. This is largely due to the fact that a numbering system has been
adopted which sub-divides the contract into 20 sections. Each section is given
an appropriate title and each clause within each section is then pre-fixed with
the relevant section number, for example, 17.1, 17.2 etc. By contrast, although
the Red Book is sub-divided into 25 sections and these sections are headed
with appropriate titles, the headings are not numbered and the clauses within

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 each section follow no set pattern of numbering, other man an overall system
of consecutive numbering.

The section headings in the Orange Book are:

Section 1: The Contract

Section 2: -
Section 3:,.* The Employer's Representative
Section 4:
Section 5: Design
Section 6: Staff and Labour
Section 7: Plant, Materials and Workmanship
Section 8: Commencement, Delays and Suspension
Section 9: Tests on Completion
Section 10: -Employer's Taking-Oyer
Section 1 1 : Tests after Completion
Section 12:
Section 13: Contract Price and Payment
Section 14: Variations

Section 16:
Section 17: Risk and Responsibility
Section 18: Insurance
Section 19: Force Majeure
Section 20: Claims, Disputes and Arbitration

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 TYPE OF CONTRACT - LUMP SUM OR REMEASUREMENT

Unlike the Red and Yellow Books - which are remeasurement or measure and
value contracts - an important feature of the Orange Book is that it is intended
to?be a lump sum contract. In particular, Sub-Clause 13.1 provides:
''''''''^'>w''f''^i--'^:-a'C^'-'''- ' ^*

"payment for the Works shall be made on a fixed lump sum basis".

Despite the literal meaning of the term lump sum however, this does not mean
that the Contract Price cannot be varied and, as will be seen from later papers,
it is important to bear in mind that there exists in the Orange Book a host of
contractiial mechanisnis which can cause the Contract Price to go up and down
throughout the carrying out of the Works.

DEFINITIONS

The Definitions appear in Section 1 and re-pay careful study. These

definitions are grouped under 6 sub-headings and are listed alphabetically
within each sub-section. This is a considerable improvement on the non-
alphabetical list approach of the Red Book, but in practice it is sometimes
irritating to have to work out which sub-heading a definition might fall under
and purists would no doubt have preferred a,totally alphabetical Jlst. The
definition sub-headings adopted are:

Documents
Persons
Dates, Times and Periods

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 Tests and Completion
Money and Payments
Other Definitions.

Although many of the terms are familiar to users of the Red and Yellow Books,
there are a number of new terms, in particular those relating to matters of
design, namely the Employer's Requirements and the Construction Documents.

e defined as:
V

"the description of the scope, standard, design criteria (if any) and
programme of work, as included in the Contract and any alterations and
modifications thereto in accordance with the Contract".

Further, Sub-Clause 4.1 provides that:

"The Works as completed by the Contractor shall be wholly in

accordance with the Contract and fit for the purposes for which they are
intended. The Works shall include any work which is necessary to

Thus, from the Employer's point of view the Employer's Requirements are of
paramount importance in defining precisely what end product 1fle Employer
wishes to achieve. Although it is beyond the scope of this introduction to
consider the wider legal implications of the phrase "fit for the purposes for
which they are intended", suffice to say that such purposes should be set out
clearly as part of the Employer's Requirements in order to enable to the
Employer to place full reliance on this phrase.

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 It will be noted that the definition of Employer's Requirements includes
alterations and modifications"1. Under Sub-Clause 14.1 the Contractor has no
right to refuse to carry out a Variation. Thus, in entering into the Contract the
Contractor not only agrees that the Works as envisaged at the time of tender
will be fit for purpose, but also any variation. This is a relatively onerous
obligation and in some other forms of design/build contracts the Contractor has
a contractual right to refuse a variation instruction.

The (Constmction Dogmaegtsj are defined as:

"all drawings, calculations, computer software (programs), samples,

patterns, models, operation and maintenance manuals and other manuals
and information of a similar nature, to be submitted by the Contractor".

The latter definition ties into Sub-Clause 5.2 whereby the Contractor is obliged
to submit each of the Construction Documents 1

PRIORITY OF DOCUMENTS

Sub^ClauseL 6 provides that the documents forming part of the Contract are to
be taken as mutually explanatory of one another but that in the event of an
ambiguity or discrepancy the priority of the documents shall be:

(a) The Contract Agreement;

(b) The Letter of Acceptance;

1
It is unclear why the term "Variation" is not used here since this is also a defined term.
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 (c) The Employer's Requirements;

(d) The Teji4er;

(e) The Conditions of Contract, Part H;

() The Conditions of Contract, Part I;

(g) The Schedules; and

(h) The Contractor's Proposal.

It is perhaps surprising that "the Tender" is placed higher in priority than the
Conditions of Contract particularly hearing in mind the fact that the
Contractor's Proposal ranks the lowest in priority.

When read in conjunction with the definition of "the Contract" (Sub-Clause

1.1.1.1), it is apparent that Sub-Clause 1.6 does not provide an exhaustive
guide to the potential contents of the Contract and the regime for resolving
ambiguities and discrepancies. This is because the definition of "the Contract"
is expressed to also include:

"such further documents as may be expressly incorporated in the

Letter of Acceptance or Contract Agreement".

It is hoped that die Employer will not see these words as a signal sanctioning
the inclusion of the minutes of pre-contract negotiations or to allow the

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 Contractor's qualifications and observations to be incorporated. If so, this )
practice could give rise to conflict with the other documents. Further, in these
circumstances ambiguity which is not specifically dealt with in Clause 1.6 may
arise.

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 3. THE PARTIES RESPONSIBLE FOR THE
ADMINISTRATION OF THE ORANGE BOOK

INTRODUCTION

The following play a formal role under the Orange Book;

(a) the Employer;

(b) the Contractor;

(c) the Employer's Representative;

(d) the Contractor's Representative;

(e) the Dispute Adjudication Board.

In addition, behind the scenes there is likely to be one, and possibly two, other
parties namely a consultant responsible for design on behalf of the Contractor2
w:a
and, a consultant
,. , ii f
responsible
for preparing ,...,a^*H' ^
any .
preliminary design forming part
of the Employer's Requirements. The latter may well also fulfil the role of the
Employer's Representative. /

^OauseS-lfaefines who may prepare the design on behalf of the Contractor as: "qualified designers who are
engjneersorother professionals who comply with the criteria (if any) stated in the Employer's Requirements".
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 4 THE EMPLOYER'S REPRESENTATIVE '7)

Although there is no Engineer under the Orange Book, the reader would
probably be forgiven for thinking that many of the Employer's Representative's
duties bear a strong similarity to those of the Engineer under the Red and
Yellow Books. In particular, it is the Employer's Representative who is
responsible for deciding on:

(ia| claims arising out of unforeseeable sub-surface conditions under Clause

4.11;

(b) ^he acceptabui^ of the Construction Documents under Clause 5.2;

(c) ^extgnsions oltime under Clause 8.3;

(d) whether the Works pa^sJ^J^fs on Completion under Clause 9.4;

jjjjjyver of the Works under Clause 10.1;

(f) Jtelectsunder Clause 12.4;

(g) payment under Clause 13;

(h) Variations under Clause 14.

In discharging his responsibilities there is %o express obligation on the

Employer's Representative to act impartially in contrast to the Red and Yellow
Books. Further, the Red Book obligation to "consult with the Employer" is not

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 to be found in the Orange Book. Having said this, at least in an English legal
context it is likely that the Employer's Representative will be held to be obliged
to act in an impartial and unbiased manner when adjudicating on matters of
payment, extension of time etc. This is reinforced by Sub-Qaus^iAWiich
JU-*"~^
provides:

"When the Employer's Representative is requked to determine value,

cost or extension-'-..,....
of, time,
- -~. - i->. ^' ^-
H V ;
he shall consult with the Contractor in an
endeavour to reach agreement. If agreement is not achieved, the
f .:-';5;*"rAW .?-;* s
** *

Employer's Representative shall determine the matter fairly, reasonably

As to the qualifications to act as Employer's Representative, under Sub-Clause

.-|
itil\he or she:

"shall be a suitably qualified engineer or other appropriate professional,

having the experience and capability necessary for compliance with this
Clause, or shall employ such suitably qualified engineers and other
professionals and make them available for the Contract"

The latter part of the definition would cover a situation where, for example, the
named Employer's Representative is an employee of the Employer who is not
him or herself suitability qualified.

Like the Engineer under the Red and Yellow Books the Employer's
Representative retains the role of Quality Controller.

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 The Employer's Representative Although the )
Orange Book is subject to a three tier dispute resolution procedure, the first
tier involves reference to the Dispute Adjudication Board (see later paper on
Claims Handling and Dispute Resolution).

5. THE EMPLOYER

The Employer plays a secondary, but nonetheless important, role compared

with that of the Employer's Representative. In particular the Employer:

(a) ^provides the Site under Clause 2.1;

(b) is entied to jgjminatetneContrat without cause

(c) carries out Tests after Completion under Clause Wi-i;*

(d)

(e) terminates the Contractor's employment with cause under Clause 15.2;

(f) accepts the Employer's Risks under Clause 17.3.

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 6. THE CONTRACTOR

INTRODUCTION

The most striking feature of the Orange Book is clearly the disappearance of
the Engineer; the other striking feature is, consequently, that the!

A series of Clauses describe the role and duties of the Contractor. The most
essential and central clause is obviously that dealing with "Design" (Clause 5),
although it is preceded by a clause entitled "The Contractor" (Clause 4)
covering certain other obligations, which might seem less typical of a Design-
Build context.

In fact, when scanning through Clause 4, one realises that most of the
apparently common obligations of the Contractor reflect and enhance his
fundamental role in the Project, which goes beyond the Design itself and
the Project as a whole.

Finally, Clauses 6 and 7 although dealing with what might appear as more
secondary obligations of the Contractor, also reveal this overall role of the
Contractor, who takes on the fullest responsibility for, respectively, Staff and
andnt inall

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 o
THE DESIGN ROLE OF THE CONTRACTOR

Clause 5 specifically deals with the Design and starte (5.1 General Obligations)
with the assumption that the Contractor has the "experience and capability
?

necessary for the design" since he "

But the Contractor also holds out "his designers and design Subcontractors" as
sufficiently competent, which suggests that the design may either be done
internally by the Contractors own designers or sub-contracted to design
consultants. The only imperative is that the design shall be "prepared Jjy
qualified designers who are engineers or other professionals -who comply with
the criteria (if any) stated in the Employer's Requirements".

It is interesting to note that the Red Book does not contain any definition of the
Engineer nor any possibility of providing for criteria which the Engineer should
comply with in order to be regarded as sufficiently experienced and capable.
Clause 2.1 of the Red Book only sets out in broad terms die Engineer's duties
and authority.

While the Orange Book does not either provide for a formal and conceptual
definition of the "Design Engineer", (since it was felt that he should be treated
as part of the Contractor's organisation, which is consistent with the idea of a
single point responsibility), it is however quite specific, as to the standards.
expected from the Designer, and provides for an opportunity to be even more
specific by including all sorts of technical criteria in the Employer's
Requirements.

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 Such guidelines and precision as to the Quality of the Design Engineer used by
the Contractor seems on first impression to be rather pointless, or even in
contradiction with the global undertaking of the Contractor who holds himself
out as a competent professional, and who therefore warrants the quality of his
services and performance. This is in fact consistent with the spirit of the
^ '^'^,-":-^^'--^^^,-A^i^j-^^;:^^^^^^f^ *

Orange Book, as we will see further that the Employer keeps a substantial
supervisory role, and remains in control throughout the progress of the works.
while incurring no liability whatsoever and letting it rest fully onto the
Contractor.

The General Obligations of the Contractor are set out under clause 5.1 to the
effect of vesting him with the most comprehensive responsibility for the whole
i project from conception to actual performance, and the remaining0 sub-clauses
of the clause draw out the practical consequences of such general obligation.
In particular, much of clause 5 refers to Construction Documents (cl 5.2),
Technical Standards and Regulations (cl 5.4) and as-built drawings (cl 5.6).

The Design obviously constitutes the most substantial part of the Construction
4
Doc1ttints, and is covered by the words "drawings, calculations, and
computer software".

The design documents will be issued as appropriate through successive stages

of the Works.

The initial stage will be that of the^riiw^^^^^^^a^^^e^gj^^^^which is

the ^lblpel^fliScffliibfy. It is the only stage where the responsibility is
still that of the Employer but since the basia design criteria will be included in
, and therefore used as a basis for the Contractor's

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 the will, inevitably,

"*&.r\
ces that the Contractor might make
as a result of being misled by errors, miscalculations and mistakes contained in
aadsMlLbe held
dless of their initial cause, (which might in fact be a
^^^****"*^*iesB^^iipggi!
mistake of the Employer's own Designers!)

The Contractor also has a "Duty to Warn" the Employer of any such difficulties
arising ^ut^f4he-^
generally.
'" *'
Furthermore, the levelit&^^f^^^^W^
of detail contained in the preliminary design
-WJPL^iX,depending on the complexity of the project; most of the time, the
preliminary design will not be sufficiently detailed to allow construction to
fe^1*?!!!?!*^^ 1S?(*9WH!53!W*IWW!ei!-.. -..,-. __ _ _ _ _ _
,.-, wr,- ,, _ ___.,
,.,-
. . . .'''^^^^^^^laf^^K^e^^f^^faKIKrlf^*^'^-----"--

proceed. A final stage

w will be
. needed, in order to produce
* what the Orange
Book refers to as "The Design", the responsibility of which lies fully with the
Contractor.

Last but not least, it should be noted that a large number of sub-clauses relating
to Construction Documents deal with submission and approval of documents:

sub-clause 5.2 contains the general statement that documents must be

submitted to Jhe .^f^^^^i^mL and may not be used for
construction or manufacture until such approval is issued

pursuant to sub-clause 5.3, the

actor formally undertakes to
comjpjy witft tue laws oijbicojmtryT -V--"- -v*'
Jhe Contract Documents. Sub-
S^^^^*s^,^^-->^^

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 Clause 5.4 goes even further, as not only the Design but also all the
Construction Documents and all the work executed by the Contractor
shall comply with all specifications, standards and regulations
applicable under the Contract or by law

Sub-Clause 5.5 deals with the submission and approval of samples

Sub-Clauses 5.6 and 5.7 require that the Contractor shall submit both
"as built" drawings and all operation
r i
and maintenance manuals before
commencement of the Tests on Completion

The above sub-clauses are further illustrative of the underlying principles of the
Orange
0 Book, as they
J show the extent of the Employer's supervisory authority,

which on one view might be seen as ii

Turnkey concept.

THE OVERALL RESPONSIBILITY OF THE CONTRACTOR -

Moving from clause 5 to clause 4, which is entitled "The Contractor", one

finds that the overall liability of the Contractor is further confirmed.
-'SWWas

The Contractor's liability covers the project as a whole: his "General

Obligations" are set out under sub-clause 4.1, which reflects this global
responsibility. The scope of the Contractor's obligation is the Employer's
project, and is not necessarily limited to the terms of the Contract.

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 Although the Contractor might have complied with the Contract and completed
the works in accordance with the Contract, he might still not have fulfilled his
obligations if the works are not^if?||jtfAi^j^^s for which they are
intended, as defined in the Contracf (clause 4.1).

It however is the case that the Employers intent as to the purpose of works
should be defined in the contract. In other words, the Contractor should not
* incur any liability in respect of any particular purpose that the Employer had in
mind but did not define in sufficient detail in the Contract.

The Works are required not only comply with the Employer's Requirements,
the Contractor's Proposal and the Schedules, but shall also include nall works
not mentioned in the Contract but which may be inferred to be necessary for
stability or completion or the safe, reliable and efficient operation of the
Works".

While it is clear from the wording of clause 4.1 that anything necessary to
ensure stability, completion and safety of the Works is within the scope of the
Works and therefore within the scope of the fitness for purpose obligation
owed by the Contractor set out in clause 4.1, the concept of "reliable and
may give rise to various subjective
interpretations. Such loose wording may be used as an excuse for the
Employer to demand that the Works be fit for any allegedly implied purpose,
ire. the Employer might expect the Contractor to do work which is not
mentioned in |he^C0ij&ack^
the Works to be efficient when judged by the yardstick of the Employer's own
standards.

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 This global obligation of the Contractor is further enhanced by other sub-
clauses such as sub-clause 4.4 "Co-ordination of the Works" whereby the
Contractor is not only responsible for co-ordinating and executing his own
work properly, but is in charge of co-ordination and execution of the Works,
and therefore must ensure that other contractors' and sub-contractors' co-
ordination and site organisation are appropriate, as specified in the Employer's
Requirements.

A further aspect of the Contractor's obligations lies in the manner in which he

is to deal with sub-contractors. This is laid down in sub-clauses 4.5 and 4.6.
The Contractor shall not sub-contract the whole of the Works, nor shall he sub-
contract any part of the Works to sub-contractors other than those named in the
contract without the prior consent of the Employer.

But at the same time:-

the Contractor will be responsible for all sub-contractors acts, defaults,

non-observance of the contracts as if they were his own.

the Contractor will assign to the Employer any continuing obligation

owed to him by any sub-contractor, if such obligation extends beyond
the expiry of the Contract Period.

The Contractor therefore bears a full responsibility

-^'"""
for J
the sub-contracted
'^aese5is*g^|j^f?ft?f-*'''

works, and it is clear that the Employer's situation should remain the same
w^ejh|<of no|,jsome0f 4he works have been sub-contracted, although he is
ent||||% (through the Employer's Representative) to> ap^rovStr^feje^t Sub-
cpntractors, and is also entitled to benefit from any guarantee that Sub-

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 contractors might have offered and given. This reflects the general concern of
the Orange Book's Employer, to deal with a single entity and obtain maximum
guarantees and assurances.

The guarantees and assurances given by the Contractor include more traditional
guarantees and assurances such as:

sub-clause 4.2 relating to the issuance of a Performance Security by a

third parry

sub-clause 4.8 whereby the Contractor undertakes to set up a Quality

' , . -u

The latter's main purpose is to allow the .Employer to check, at virtually any
time, compUance of the Works with the requirements of the Contract. This
ability of the Employer to control the Works and their progress appears several
times throughout the Contract.

In particular, pursuant to sub-clause 4.14, the Qontractr must submit a

ftcigrainme to the Employer's Representative, within the time stated in the
Appendix to Tender, and must also provide him with fegular information
(whenever requested) about the arrangements and methods adopted for the
execution of the Works.

(sub-clause 4.15) should also be prepared and submitted

monthly by the Contractor to the Employer's Representative. The content and
the form of such reports are thoroughly described under sub-clause 4,15. The
Contractor has to provide photographs and detailed descriptions of progress at

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 every stage, from the design to the testing and commissioning of the Works,
and including procurement, manufacturing, delivery, construction and erection.
It is therefore perhaps somewhat surprising that the Employer may put the
entire responsibility of the project onto the Contractor, but nevertheless at the
same time remain in control of most aspects of the Works' progress, including
"many technical issues.

Along the same lines, it is interesting to note that sub-clause^3; ^describing the
~"~-f4.'.j&;^j[-ff

Employer's Representative's duties and authority contains one provision that

fy..". The Contractor should therefore bear in mind that

despite any approval which may be given to him by the Employer's
Representative by virtue of his role of controlling and supervising, he (the
Contractor) remains firmly responsible for the entire design, the, Works and the
project generally.

The next sub-clause of Clause 4 that I would like to discuss briefly is Sub-
Clause The Red Book, already contains such a clause (clause
11.1), entitled "Inspection of Site", pursuant to which the Contractor is deemed
to have satisfied himself that the site data obtained by or on behalf of the
Employer is sufficient and accurate.

Therefore, the Contractor is, even in the Red Book,

respoasilii^ylfeiB^ in
particular. Not only was he responsible for his own interpretation of the date
provided by the Employer, but he is also responsible for completing inspections
ari4j|Hpl|ng further date. In other words, me Employer is not to be held
Hable for any irmdequacy and inaccuracy in the date gathered by him.

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Introduction to the Orange Book CMasons
Andrew Hibbert, Partner, Masons
 Furthermore, if the Contractor wishes to indicate to the Employer any difficulty
contained in the data provided by the Employer, he will have to suggest
solutions to solve such difficulty, in order to be able to complete the Works in a
satisfactory manner.

The wording of the Orange Book is similar, except that it has been shortened,
and made even more terse: the Cvrtiactoi "shall be deemed to have obtained
aH &m(Mssw^iwjcmnat!^^
cjj^^
.-,...:,-:., ... ... ...r../......../,,...... - . .isr;,Asj;..ssJStS::,s;i,-. ~" ' -*,^
But there is no
further elaboration in the Orange Book, and the Contractor's liability is
therefore contained in one sentence, whereby no difference is made between
the data obtained by the Employer and that gathered by the Contractor - they
merge irrto one body of site Mormation that the Contractor is fully responsible

This being said, it is interesting to note that the "acceptance" of the Employer's
data by the Contractor is only deemed to occur within the limits of what is
practicable, taking into account cost and time. The responsibility will only lie
v fully on the Contractor if, at the Tender stage, he was allowed sufficient time,
and Jf the^.^t^u-ciim^
* unreasonable. It also means that there is a Iknit to the extent to which the
Contractor should go to check the accuracy of the Employer's data; he is only
expected to do what is practically feasible in order to identify possible
problems.

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Introduction to the Orange Book CMasons
Andrew Hibbert, Partner, Masons
 Likewise under the Contractor will notj>ear,KISgrislcftof nsub-
-foreseeable by an experienced
contractor".

If "/ AW opinion" such unforeseeable conditions are encountered, he will give

notice to the Employer's Representative who will inspect and investigate and
grant the Contractor an extension of time and/or the additional cost due to such
conditions provided such conditions were not foreseeable by an experienced
contractor.

FURTHER OBLIGATIONS OF THE CONTRACTOR IN RESPECT OF

THE SITE ORGANISATION - CLAUSES 6 AND 7

Not surprisingly, Clause 6 places on the Contractor the full responsibility for
thasta^^and la|?piur. Beyond the general requirement (6.8 and 6.9) to employ a
sufficient number of suitably qualified and experienced staff, (who may be
removed and replaced if the Employer so requires), Clause 6 contains a number
of sub-clauses which describe very specifically what the Contractor must and
must not do in respect of staff and labour.

Sub-clause 6.2 requires him to pay his staff and labour '!/&/>" wages by
comparison with the general wages and conditions observed in the local
industry. Such wording can be said to be protective of the interests of the
employees, but it is also rather vague and might give rise to dispute. It would
have been simpler to make a straightforward reference to the local laws.

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Introduction to the Orange Book GMasons
Andrew Hibbert, Partner, Masons
 Sub-clause 6.4 however, requires the Contractor to dompry with the relevant
labour laws and all applicable safety regulations, and Sub-clause 6.5 deals with
the permissible working hours on site.

Sub-clauses 6.6 and 6.7 oblige the Contractor to provide adequate welfare and
medical facilities on the Site at all times, including an ambulance and a
qualified safety officer.

Clause 7 deals with Plant, Materials and Workmanship,

The position in respect of Plant and Materials is clear and simple: both are
defined under Clause 1 and their ownership is transferred upon delivery to the
Site ^or, if earlier, on the date when payment becomes due. This is particularly
relevant in circumstances such as bankruptcy, default or termination.

The term "Workmanship" is not in fact defined, and the Contract must therefore
contain comprehensive instructions and guidelines as to what is expected from
the Contractor.

It is however stated under Sub-clause 7.1 that all work which is not sufficiently
specified shall be carried out in accordance with "recognised good practice",

Such wording, although fairly loose, is certainly a wise precaution from the
Employer's viewpoint as it might be difficult for him to be specific enough on
all aspects of the Contractor's works, especially when the latter is rather
specialised in his field, and/or where the Employer has a limited understanding
of the nature of the Works.

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Introduction to the Orange Book CMasons
Andrew Hibbert, Partner, Masons
 Moving onto Sub-clauses 7.3 and 7.4, it is noticeable once again that the
Employer, whose involvement is rather limited in terms of risks and
responsibility, reserves himself a full right to inspect, examine and test the
Works during manufacture.

The Employer is also entitled, under Sub-clause 7.5, to reject defective works
found during inspection and /or testing.

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Andrew Hibbert, Partner, Masons