ICE Construction Contract

ICE Construction Contr impressThe ICE Conditions of Contract 7th mutantMeasurement Version1. IntroductionThe ICE contract has been around since 1945 and is intended for use on civil organiseing exercise. Civil engineering work is fundamentally different from building work it involves fewer trades, but can be much bigger in scale thither is greater uncertainty in civil engineering work, particularly in ground works. When a state of affairs investigation takes place for building work, bore holes and trial pits usually give a good indication of the extent of ground water, rock and the like in the case of a large reservoir, for example, it is unimaginable to be as certain. This in telephone number can mean that structural work needs to be varied. For these reasons the work has to be remeasured and valued as it progresses, the bill of quantities being approximate a bode of confusion is when should work be measured and valued d consume the stairs the contracts variation provision s, and when should the re meter provisions be used. The bill of quantities therefore has two main functions firstly, as a naked as a jaybirding document and secondly, as a founding for valuation.The contract does not recognise the existence of a quantity surveyor. All payment and valuation is by the engineer, although a Q.S. may factually do some of this work.This note does not cover everything in the assures, but highlights some of the more contentious areas.2. Discussion of clausesGenerallyThe clauses look at no punctuation. Only a court can decide where punctuation can go.Clause 1 definitions and interpretationsSub-clause (1)(c ) defines the locomotive engineer. The Engineer is a person or Firm..This should be read in conjunction with clause 2(2)(a) the contractile organ must k instantaneously who go away be giving it instructions.Sub-clause (1)(v) defines the site. This can include different places and not retributory the land where work is taking place.Sub-clause (2) defines cost .all expenditure properly incurred or to be incurred whether on or off site including overhead finance and other(a) charges properly allocatable thereto but does not include every(prenominal) allowance for profit.Clause 2 The Engineer and the Engineers RepresentativeThe EngineerCarries out duties lowtake in or implied by the contractHas the authority specified in or implied in the contractA named Chartered Engineer must act as the engineer if a firm is stated in the contract, a named individual must be nominated within 7 daylights of the demo of the contract, and before the works commencement dateThe Engineer can be replaced the contractile organ must be informedThe Engineers RepresentativeHas more power than the shop assistant of works nether JCTEngineers duties may be delegated, apart from decisions and certificates chthonian 12(6), 44, 48, 60(4), 61, 65 or 66. Delegation shall be in writing with a copy to the contractorAssistantsThe Engineer or the ER may appoint assistants to assist the ER. Names shall be notified to the contractor. Assistants are purely concerned to secure the haveance of materials and workmanship as being in accordance with the contract. They can neck instructions only in relation to these matters.InstructionsShall be in writingHowever, the contractor shall be with oral instructions different from JCT.Oral instructions can be confirmed in writing by the contractor or Engineer no time limit, but as before long as is possible below the circumstancesThe Engineer or ER can be asked to specify under which of the Engineers duties or authorities the instruction was issued. It does not hang to an empowering provision, another clause in the contract, unlike JCTClause 5 (documents mutually explanatory)This clause is very legal brief but highly contentious. On the face of it, it says that the various documents forming the contract shall be taken as mutually explanatory and any ambiguities shall developed and adjusted by the engineer who shall thereupon issue instructions in writing to the contractor. These instructions shall be regarded as instructions issued under clause 13. (More will be said about clause 13 later on).Does this clause mean that only ambiguities and discrepancies included in the tender documents can be adjusted? If an error in the tender documents was so obvious when looking at the documents as a whole, should an engineer refuse to issue an instruction?Unlike JCT, the contractor does not take on to revalue the engineer about any matters requiring clarification.On the other hand the word shall imposes a duty on the engineer to issue instructions and does not lend any discretion on the engineer.It is curious that clause 13(3) refers back to clause 5 and allows for payment to be made to the contractor, but clause 5 itself makes no mention of payment.See also the comments on clause 8 below.Clause 7 (further drawings specifications and instructions)There are two classes of further drawings specifications and instructionsi). Those which amplify and explain what is already in the contract.ii). Those which require any variation to any part of the workings.. In this case the work is deemed to be a variation under clause 51 i.e. no formal instruction in writing is needed.The express link between clause 7 and clause 51 implies that the valuation rules under clause 52 should apply.It should also be noted that the contractor could be paid under clause 13, although clause 7 does not state this. under(a) sub-clause (1) the information shall be supplied from time to time. This means that the engineer can take into account the contractors actual progress on the job.Sub-clause (3) States that the contractor shall give adequate bill poster in writing. and sub-clause (4) allows for the contractor to be given an prolongation of time and extra costs if it is delayed by failure or inability of the Engineer to issue at a time reasonable in all the circumstances D rawings, Specifications or instructions requested by the contractor.. The words requested by the contractor are rather ambiguous is formal written visor under sub-clause (3) a school precedent to the operation of sub-clause (4)?Clause 8(1) (contractors general responsibilities)Under this provision the contractor shall(a) construct and complete the works (the meaning of such phrases has already been covered)(b) provide all labour materialsand everything.required .for such construction and climax so further as the necessity for providing the same is specified in or reasonably to be inferred from the Contract. The highlighted words suggest that if ambiguities and discrepancies could be corrected by inference from other contract documents, then the contractor could not expect the engineer to act under clauses 5 and 13.Clause 10 (performance security)This very important clause will be discussed in the lecture on insurances and bonds.Clauses 11 and 12 (the basis on which the tender w as based/ adduces arising from adverse physical conditions and artificial obstructions)Clause 11Sub-clause (1) under ICE 6 the employer was deemed to have made available to the Contractor, before submission of tenders, all information on ground works obtained by or on behalf of the Employer from investigations undertaken relevant to the Works. This meant that the employer should have given the contractor every piece of information about the site that was in the employers possession, and if he did not do so the contractor could have grounds for a take up under clause 12 irrespective of the contractors obligation to inspect the site under sub-clause (2). The wording has now been changed to reflect the fairer position that the contractor should have priced that job on the basis of the information actually passed to it (subject to its obligation to inspect the site under sub-clause (2).A rude(a) section (1)(b) has been added covering pipes and cables in on or over the ground.Second part of 11(1) the contractor is responsible for the interpretation of all such information for the purposes of constructing the Works. does this refer to the tender preparation or the work on site?Sub-clause (2) inspection of site the contractor is deemed to have(a) inspected the site(b) to have satisfied himself so farther as is practicable and reasonable on(i) the form and nature of the ground(ii) the extent and nature of the work(iii) means of communication and access etc. to the site(iv) obtaining information as to risks contingencies and all other circumstancesSub-clause (3) basis and sufficiency of tender the contractor shall be deemed to have(a) based his tender on his own inspection and the information made available by the Employer or obtained by the contractor(b) satisfied himself as to the correctness and sufficiency of the treads and prices stated by him in the bill of quantities.Clause 12Sub-clause (1) Has the Contractor encountered physical conditions (other t han weather conditions or conditions collectable to weather conditions) or artificial obstructions which could not reasonably have been foreseen by an experienced Contractor? Clearly, foreseeability would need to be examined in the light of what information the employer passed to the contractor under 11(1) and the information that should have been gathered by the contractor under 11(2). If so written notice should be givenUnder sub-clause (2) the Contractor shall at the same time or as soon thereafter as may be reasonable inform the Engineer in writing pursuant to Clause 53 and/or Clause 44(1) that he intends to claim costs and/or timeNB clause 53 has a 28 day limitSub-clause (3) requires the Contractor to give details of any evaluate effects of the physical conditions or artificial obstructions measures he has taken or is taking and anticipated effects, costs and delays in or interference with the carrying out of the Works (whether or not the contractor intends to submit a claim) .Sub-clause (4) action by the engineer he may require the Contractor to investigate and report on alternative measures he can give written consent to the measures taken by the Contractor give written instructions as to how the physical condition or artificial obstruction should be dealt with and he can order suspension under clause 40 or a variation under clause 51Up to this point there is no admission of liability on behalf of the employer unless a variation has been orderedSub-clause (5) if the Engineer decides that the physical condition or artificial obstruction could have been reasonably foreseen by an experienced Contractorthen the Engineer shall inform the Contractor in writing however, any variation ordered under sub-clause (4)(d) shall be paid under Clause 52.Sub-clause (6) the engineer determines the delay and costs incurred with a reasonable addition for profit, and any extension of time provided that the conditions or obstructions could not reasonably have been fore seen by an experienced contractor. There is no need for the contractor to submit a separate claim for an extension of time under clause 44.Clause 13Sub-clause (1) (work to be to satisfaction of engineer)Save insofar as it is legally or physically impossible the Contractor shall construct and complete the Works in strict accordance with the Contract.and shall comply with and adhere strictly to the Engineers instructions on any matter connected therewith (whether mentioned in the Contract or not).These words have barely changed over the years, and have been considered by the courts in several prominent cases.Consider the pursual scenario A contractor is asked to forward a method account with his tender. When the work starts it soon becomes apparent that the contractors method statement is impossible to work to, and he has to do the work in a more expensive manner. Can the contractor claim the extra costs involved?Sub-clause (2) states that the mode and manner of construction shall be to the engineers satisfaction.Sub-clause (3) gives the procedure for dealing with delay and extra costs.A final point to consider should variations be issued under clause 51 or 13?Clause 14 The ProgrammeThe programme under ICE has much more significance than under ICE, but not as much as under the NEC. It is, however, not a contract document.The programme should be submitted by the contractor within 21 days of the award of the contract. There are procedures for the Engineer to accept or reject the programme with reasons. In that case the contractor must amend and resubmit the programme. These procedures are all carried out in 21 day time frames.Together with the programme the engineer may request a general description of the arrangements and methods of construction.The accepted programme should be revised if the Engineer considers that the actual progress of work does not confirm to the programme.Clause 40The Engineer may instruct the contractor to suspend the progress of the wo rks or any part thereof. Subject to the exceptions listed, the contractor can be given an extension of time and costs.Clause 41The contractor shall start the works as soon as is reasonably practicable after the works commencement date. The contractor should proceed with due expedition and without delay.Clause 44The contractor should give notice within 28 days if the matters listed entitle him to an extension of time.Note sub-clause (1)(f) other special circumstances of any kind whatsoever This would be interpreted contra proferentem by a court.The Engineer shall make an assessment of the delay and notify the contractor in writing. The Engineer shall also make an assessment in the absence of a written notice from the contractor.The Engineer can make an interim extension award. This cannot later be reduced.The Engineer makes a further assessment at the due date for completion. Again, this cannot later be reduced.The Engineer makes a final determination within 28 days of substantial c ompletion.Clause 46If the Engineer considers that the contractors rate of progress is too slow, he may issue a notice to the contractor. The contractor shall then take steps to expedite the progress of the works. This is not acceleration. quickening is covered by sub-clause (3).Clause 47 liquidated damagesUnlike JCT, the Engineer does not issue a notice of non-completion/Note that under ICE, the deduction of LADs is hang up for the period of an intervening variation, then resumes. JCT does not specifically state this, but legally the position is the same.Clause 48This covers substantial completion, which is different from practical completion under JCT.under ICE the contractor starts the procedure by notifying the Engineer there is no such notice under JCT. The Engineer decides within 21 days. The work so certified shall have passed any final test.Outstanding work can be completed after substantial completion there are no criteria defining when such work can so be permitted.Claus e 49Covers outstanding work. The contractor must continue insuring this work until it is accepted.Clauses 51 and 52 variations and their valuationThese are similar to JCT. Note that if the contractor informs the Engineer that a rate for work not the subject of the variation is rendered unsuitable by the variation, the Engineer shall fix the rate.Clause 53 additional paymentsClaims are submitted under this clause, apart from any dealt with by clauses 12 or 13. Note that the basis of payment is cost, not loss and/or expense.Clauses 55-57 MeasurementICE is a measure and value contract, so procedures for remeasurement need to be included.The quantities in the BQ are estimatesThe Engineer ascertains by admeasurementRates can be adjusted if the quantity of an item increases or decreases this is determined by the engineer after consulting the contractorThe contractor is to be given an opportunity to attend for measurement if he does not, the Engineers measurements are taken to be cor rect.Remeasured work may be valued on dayworkThe method of measurement is CESMM unless otherwise provided in the contractClause 60 security measuress and PaymentsThe contractor prepares interim payment applications unless the contractor decides one is not neededPayments are made monthlyA minimum amount stated in the appendix must be reached before a payment is madeInterest is payable on overdue payments. This is in addition to the right of suspension under the Construction Act.Within 3 months of the defects correction certificate, the contractor shall forward to the Engineer a statement of final account.Within a further 3 months the Engineer issues the certificate. This is only a payment certificate and signifies nothing else.Clause 61 Defects Correction CertificateThis is issuedAt the end of the DC periodIf more than one DC period applies, it is issued at the end of the last periodOutstanding work under 48 must be completedMaking good under 49 and 50 must be completedThe certifi cate states the date when the contractor shall have completed his obligations to construct and complete the Works to the Engineers satisfaction. This is the most important certificate under ICE. Compare this certificate with the final certificate under JCT.