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NEW QUESTION # 12
Under the FIDIC Red and Yellow Books (edition 1999): if the Engineer gives an instruction which requires the Employer's prior approval, the Contractor is required to verify whether the Engineer has obtained the Employer's prior approval or not. Is this statement true or false?
- A. True
- B. False
Answer: B
Explanation:
Under the FIDIC Red and Yellow Books 1999 editions, the Engineer acts as the Employer's representative with authority delegated under the contract. When an instruction requires the Employer's prior approval, it is primarily the Engineer's responsibility to obtain that approval before issuing the instruction to the Contractor.
The Contractor isnot contractually required to verifywhether the Engineer has obtained the Employer's approval. The Contractor is generally entitled to rely on the Engineer's instructions as valid and binding unless there is clear evidence to the contrary.
This principle avoids placing an undue administrative burden on the Contractor and maintains the hierarchical contract administration structure, where the Engineer is the primary point of contact and decision-maker.
References:
FIDIC Red Book 1999 Edition, Sub-Clause 3.1 - Engineer's Duties and Authority FIDIC Yellow Book 1999 Edition, similar provisions FIDIC Contract Manager Study Guide, Module on Contract Administration Procedures
NEW QUESTION # 13
The amount of an advance payment guarantee provided for pursuant to FIDIC Red and Yellow Books (both editions) may be reduced as of:
- A. The date on which an amount is repaid by the Contractor as stated in the Payment Certificates
- B. The Commencement Date
- C. The date on which the entire advance payment is repaid as stated in the Payment Certificate
- D. The date of the Taking Over Certificate
Answer: A
Explanation:
According to FIDIC Red and Yellow Books (both 1999 and 2017 editions), the advance payment guarantee amount may be progressively reduced as the Contractor repays the advance payment through deductions from interim payment certificates. This means the guarantee is reduced as per amounts repaid, not only upon full repayment.
Option D is correct: The guarantee reduces as partial repayments are certified in Payment Certificates.
Option C is incorrect because the reduction happens gradually, not only after full repayment.
Options A and B do not directly relate to the reduction mechanism of the advance payment guarantee.
References:
FIDIC Red and Yellow Books 1999 & 2017 Editions, Sub-Clause 14.2 - Advance Payment Guarantee FIDIC Contract Manager Study Guide, Module on Payment Procedures
NEW QUESTION # 14
You are the Contract Manager for the Engineer in a hotel project using FIDIC Red Book (edition 1999). The Employer demands perfection in the project's design and construction quality. There are many Variations initiated by the Employer during construction. Which one of the following is NOT considered as a Variation?
- A. The Employer verbally instructs a change in the layout of the rooftop restaurant. The Engineer issued an Instruction describing the required change with revised design drawings.
- B. The Engineer instructs a change in slopes of stairs to the parking lot with an Instruction in accordance with Sub-Clause 3.3.
- C. The Engineer requests a proposal regarding a change in type of windows and doors of the business centre.
- D. The Contractor submits a Value Engineering proposal, in which it proposed to change the colour of the outdoor paint. The Engineer approved the proposal.
Answer: D
Explanation:
Comprehensive and Detailed Explanation:
Option A is NOT a Variation because it originates from a Value Engineering proposal by the Contractor, not from Employer or Engineer instruction or request.
Options B, C, and D are all variations initiated by the Employer or Engineer.
References:
FIDIC Red Book 1999 Edition, Clause 3 - Variations
FIDIC Contract Manager Study Guide, Module on Variations
NEW QUESTION # 15
Which one of the following statements is NOT correct in respect of FIDIC Red Book (both editions)?
- A. 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.
- B. The General Conditions allocate the risks between the parties on a fair and equitable basis.
- C. The Contract typically becomes legally effective when the Employer issues the Letter of Acceptance to the Contractor.
- D. 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.
Answer: D
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 # 16
Regarding the FIDIC Silver Book (both editions), if a part of the Works is to be paid according to quantity supplied or work done, appropriate provisions must be included in the Particular Conditions. Is this statement true or false?
- A. False
- B. True
Answer: B
Explanation:
This statement is true. The Silver Book (EPC/Turnkey contracts) usually involves lump-sum payment, but if part payment is based on quantity or work done, this must be explicitly provided for in the Particular Conditions to avoid ambiguity.
Such provisions ensure clarity on payment terms in line with project specifics.
References:
FIDIC Silver Book 1999 & 2017 Editions, Sub-Clause 14 - Payment Provisions FIDIC Contract Manager Study Guide, Module on Payment Procedures
NEW QUESTION # 17
Which two of the following statements are correct regarding Dispute under the FIDIC Red, Yellow, and Silver Books (edition 2017)?
Choose all of the correct answers (multiple possibilities)
- A. If a Party is dissatisfied with the determination and has given Notice of Dissatisfaction (NOD) to the other party within a strict 28-day time limit, a Dispute arises and either Party may proceed under Sub- Clause 21.4 to obtain a DAAB decision on it.
- B. Both 'Disagreement' and 'Dispute' are defined terms under the Conditions of Contract.
- C. The Dispute must be submitted to the Dispute Avoidance and Adjudication Board (DAAB) within 42 days, otherwise the NOD is deemed to have lapsed and is no longer valid.
- D. In case the Engineer refuses to issue a Performance Certificate or to issue one with a correct date under Sub-Clause 11.9, and the Contractor has disagreed with the requested entitlement or relief in connection with this refusal, Dispute shall be deemed to have arisen.
Answer: A,D
Explanation:
Option A is correct. Under Sub-Clause 11.9 (Performance Certificate) refusal or incorrect issuance by the Engineer, combined with disagreement by the Contractor, may cause a Dispute to arise.
Option B is correct. If a Party is dissatisfied with a determination, it must give a Notice of Dissatisfaction (NOD) within 28 days to escalate the matter to a Dispute, allowing either Party to refer it to the DAAB as per Sub-Clause 21.4.
Option C is incorrect. The contract does not specify a 42-day time limit for submission to DAAB after NOD; timelines vary by contract and stage.
Option D is incorrect. 'Disagreement' is not a formally defined term in FIDIC contracts, whereas 'Dispute' is.
References:
FIDIC Red, Yellow, Silver Books 2017 Edition, Sub-Clause 11.9 and Clause 21 - Claims, Disputes, and Adjudication FIDIC Contract Manager Study Guide, Module on Dispute Resolution
NEW QUESTION # 18
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 the immediate end to the Contract unconditionally whenever issued.
- D. It confirms full and final settlement of all money due to the Contractor.
Answer: D
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 # 19
Which one of the following statements is NOT correct in respect of FIDIC Yellow Book (both editions)?
- A. A disproportionate amount of risks is allocated to the Contractor under the General Conditions.
- B. The General Conditions allocate the risks between the parties on a fair and equitable basis.
- C. The Contractor provides plant and designs (except as otherwise specified) and executes the other works, all in accordance with the Contract, which includes its Proposal and the Employer's Requirements.
- D. The Contract typically becomes legally effective when the Employer issues the Letter of Acceptance to the Contractor.
Answer: A
Explanation:
Option C is NOT correct. FIDIC Yellow Book General Conditions aim to allocate risks fairly and equitably between the Employer and Contractor. The contract balances risks according to who is best able to manage them. It does not impose a disproportionate risk burden on the Contractor.
Options A, B, and D are correct statements describing typical contract formation, risk allocation, and Contractor's design and execution responsibilities.
References:
FIDIC Yellow Book 1999 and 2017 Editions - Introduction and Risk Allocation Clauses FIDIC Contract Manager Study Guide, Module on Introduction to FIDIC Contracts
NEW QUESTION # 20
Under the FIDIC Red Book (edition 2017), if the Contractor fails to comply with Site clearance obligation, what two options does the Employer have?
Choose all of the correct answers (multiple possibilities)
- A. The Engineer cannot sell or otherwise dispose any remaining items and reinstate the Site at the Contractor's Cost.
- B. The Employer may sell or otherwise dispose any remaining items and reinstate the Site at the Contractor's Cost.
- C. The Employer is entitled to the cost of reinstating, clearing the Site and disposal cost to the extent they exceed the money received from selling the remaining Contractor's items on the Site.
- D. The Employer cannot reinstate and clear the Site and dispose the remaining Contractor's items on the Site if the Contractor fails, as this is the Contractor's obligation.
Answer: B,C
Explanation:
* Option Ais correct: The Employer may sell or dispose of any items left by the Contractor and reinstate the Site, recovering costs from the Contractor.
* Option Cis correct: The Employer is entitled to recover costs for clearing, reinstatement, and disposal exceeding proceeds from sale.
* Option Bis incorrect; the Engineer does not hold this authority, but the Employer does under the contract.
* Option Dis incorrect; if the Contractor fails to clear the Site, the Employer may take action to protect the Site.
References:
FIDIC Red Book 2017 Edition, Sub-Clause 8.7 - Contractor's Use of Site
FIDIC Contract Manager Study Guide, Module on Contract Administration Procedures
NEW QUESTION # 21
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 EPC/Turnkey Projects ("Silver Book").
- B. FIDIC Conditions of Contract for Plant and Design Build ("Yellow Book").
- C. FIDIC Conditions of Contract for Construction ("Red Book").
Answer: B,C
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 # 22
There are four reasons that the Employer/Contractor shall advise in advance each other and the Engineer of any known or future events or circumstances.
Which two of the following statements areNOTapplicable reasons?
(Choose all correct answers - multiple possibilities)
- A. Increase the performance of the Works when completed.
- B. Decrease the Contract Price.
- C. Delay the execution of the Works or a Section.
- D. Adversely affect the work of the Contractor's Personnel.
Answer: A,B
Explanation:
Comprehensive and Detailed Explanation:
Under the FIDIC Red Book 2017 (similar principles apply in other editions), Sub-Clause 4.1 ("Contractor's General Obligations") and Sub-Clause 3.4 ("Delay Damages") require both Employer and Contractor to notify the Engineer in advance about any events or circumstances which maydelay the worksoradversely affect the Contractor's personnel or progress. This early notification ensures proper management and mitigation of risks that could impact the project timeline or quality.
* Option A (Delay the execution of the Works or a Section)is a core reason for notification since delays affect the critical path and programme, requiring possible extensions or adjustments.
* Option C (Adversely affect the work of the Contractor's Personnel)is also a valid reason because issues affecting workforce productivity or availability can impact project delivery.
On the other hand:
* Option B (Decrease the Contract Price)isnota reason to notify. Changes in contract price usually arise from variations or claims but are not a "known or future event" requiring prior notification unless linked to a variation or compensation event.
* Option D (Increase the performance of the Works when completed)is positive and does not negatively affect project progress or cost; therefore, it is not a reason for advance notification under these contract provisions.
Thus, the twonot applicablereasons are B and D.
References:
FIDIC Conditions of Contract for Construction, 2017 Edition, Sub-Clause 4.1 - Contractor's General Obligations FIDIC Conditions of Contract for Construction, 2017 Edition, Sub-Clause 3.4 - Delay Damages FIDIC Contract Manager Study Guide, Module on Communication and Reporting
NEW QUESTION # 23
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. 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.
- B. 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.
- 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 # 24
Applying FIDIC Silver Book (edition 1999), which one of the following elements shallnotform part of the time Programme/revised programme?
- A. The remedial work (if any) instructed under Sub-Clause 7.6.
- B. Review periods under Sub-Clause 5.2.
- C. The sequence and timing of inspections and tests.
- D. The intended order of the works.
Answer: A
Explanation:
Comprehensive and Detailed Explanation:
According to the FIDIC Silver Book, 1999 Edition (The Conditions of Contract for EPC/Turnkey Projects), the Contractor is required under Sub-Clause 8.3 ("Programme") to submit a time programme that illustrates the sequence and timing of the works, including milestones and key events. The intended order of the works (Option A), sequence and timing of inspections and tests (Option B), and review periods (Option D) related to contract management processes such as approval of design or submissions (Sub-Clause 5.2) are integral to effective scheduling and coordination.
However,remedial work instructed under Sub-Clause 7.6, which concerns remedying defects or damage, is generally not part of the initial or revised programme. Instead, remedial works are typically handled as separate tasks or incorporated into specific defect liability or rectification schedules after the main programme has been executed. Such remedial works arise from defects liability obligations and do not belong to the original or revised time programme used to plan the main construction phases.
This distinction is important because the programme reflects planned works execution, whereas remedial work is reactive and may be scheduled separately under defects liability clauses or final project close-out arrangements.
References:
FIDIC Silver Book 1999 Edition, Clause 8.3 - Programme
FIDIC Silver Book 1999 Edition, Clause 7.6 - Remedial Work
FIDIC Contract Manager Study Guide, Module on Time and Delay Management
NEW QUESTION # 25
The details of all the matters that have been clarified and agreed between the Employer and tenderers during the tender stage are recorded by, for instance, a memorandum of understanding. The Employer may award the contract to the tenderer through a letter of formal acceptance, signed by the Employer. This process is in compliance with which one of the following Golden Principles (GP's)?
- A. GP 3
- B. GP 1
- C. GPA
- D. GP 2
Answer: B
Explanation:
FIDIC's Golden Principles (GPs) guide good contract management and administration.Golden Principle 1 (GP1)emphasizes"Clear communication and documentation"to avoid misunderstandings and disputes. It specifically promotes thorough documentation of all agreements and clarifications reached during the tender process. The use of a memorandum of understanding or similar record ensures transparency and mutual understanding. Furthermore, the formal award of the contract by a signed letter of acceptance aligns with the principle of clear and formal contract formation.
* GP1ensures that all key matters, changes, and agreements are properly documented during the tender phase and contract award to form an unambiguous contractual basis.
* GP2 and GP3relate more to ongoing contract administration, risk management, and dispute resolution rather than the contract formation process.
* GPA(Golden Principle A) is not a standard FIDIC term associated with contract formation or tender stage documentation.
Therefore, the described process aligns best withGolden Principle 1 (GP1).
References:
FIDIC Contract Manager Study Guide, Section on Golden Principles of Contract Management FIDIC Guidelines for Contract Managers
NEW QUESTION # 26
You are the Contract Manager of the Engineer in a condominium project under FIDIC Yellow Book (edition
2017), with Time for Completion of 5 months.
The Contractor received a Letter of Acceptance on 1 May 2022. The Contract Agreement was signed on 1 June 2022. The Contract Agreement states that the Commencement Date shall be notified by the Engineer, but it shall be no later than 14 days after the signing of the Contract Agreement, subject to the issuance of the construction permit.
1 July 2022 is the first day the Engineer was at Site. On the same day, the Engineer issued a Notice to the Contractor that the Commencement Date shall be 15 July 2022. However, the construction permit was issued only on 1 August 2022.
The Project was completed on 1 December 2022. After completion, the Employer submitted a claim for Delay Damages. Following consultations, the Parties could not reach agreement on the Commencement Date.
What is the correct Commencement Date?
- A. 15 July 2022
- B. 12 June 2022
- C. 1 August 2022
- D. 15 June 2022
Answer: C
Explanation:
According to the FIDIC Yellow Book 2017, the Commencement Date is the date notified by the Engineer as the date on which the Contractor shall start the execution of the Works (Sub-Clause 8.1). In this case, although the Engineer notified 15 July 2022 as the Commencement Date, it was subject to the issuance of the construction permit. Since the construction permit was only obtained on 1 August 2022, work could not legally commence before that date.
FIDIC recognizes that the Contractor cannot be expected to start before all necessary permissions are granted.
Hence, the effective Commencement Date must be the earliest date on which the Contractor can legally commence work, i.e., the date when the permit was issued (1 August 2022). The contract's requirement that the Commencement Date notification occur no later than 14 days after signing is subject to actual readiness conditions (permit availability).
Therefore, for purposes of delay and completion, the Commencement Date is 1 August 2022. This affects the calculation of the Time for Completion and any delay claims accordingly.
References:
FIDIC Yellow Book 2017 Edition, Sub-Clause 8.1 - Commencement of Works
FIDIC Yellow Book 2017 Edition, Sub-Clause 2.1 - Right of Access to Site and Permits FIDIC Contract Manager Study Guide, Module on Contract Formation and Execution
NEW QUESTION # 27
Which FIDIC Book (edition 2017) should be considered first by an Employer that is an experienced employer who knows exactly what they want from a design & engineering perspective?
- A. Yellow or Silver Book
- B. Red Book
- C. Silver Book
- D. Yellow Book
Answer: B
Explanation:
The FIDIC Red Book (2017 edition) is traditionally used for construction contracts where the Employer provides the design, and the Contractor primarily executes the construction works. This form is suitable for Employers who have detailed and well-defined design and engineering requirements and want to retain control over the design.
* TheRed Bookis ideal for experienced Employers who have a clear and fixed design and require the Contractor to build accordingly.
* TheYellow Bookis typically used where the Contractor is responsible for both design and construction (design & build). It suits Employers who want to delegate design responsibility to the Contractor.
* TheSilver Bookis used for turnkey or EPC contracts where the Contractor takes full responsibility for design, procurement, construction, and commissioning, suitable for Employers seeking minimal involvement in design and execution details.
* Hence, for an Employer whoknows exactly what they wantfrom a design and engineering perspective and wants to maintain control, theRed Bookis the first and most appropriate choice.
References:
FIDIC Red Book 2017 Edition - Conditions of Contract for Construction
FIDIC Yellow Book 2017 Edition - Conditions of Contract for Plant and Design-Build FIDIC Silver Book 2017 Edition - Conditions of Contract for EPC/Turnkey Projects FIDIC Contract Manager Study Guide, Module on Contract Selection
NEW QUESTION # 28
You are the Contract Manager of the Engineer and person Y is the Contract Manager of the Employer in a construction project under FIDIC 2017 Red Book. The project is late in schedule and Y has issued Employer's claim on Delay Damages. You have asked Y to consider whether the Contractor's delay to completion is a reflection of cash-flow shortfall from interim payments before making deductions to the Contractor's payment. Y replied that even if the Contractor pays Delay Damages to the Employer, the Contractor is still obliged to complete the Works and is not relieved from its duties and obligations. You warned Y of the risks of further reduction of cash-flow by the deduction of Delay Damages from payments. As this could worsen the situation of the Contractor, leading to further delays to the completion of the Works. Who is right?
- A. You are correct, Y is wrong.
- B. Both you and Y are wrong.
- C. Both you and Y are both correct.
- D. You are wrong, Y is correct.
Answer: C
Explanation:
Both statements are correct:
Y is right that payment of Delay Damages does not relieve the Contractor from completing the Works.
You are also correct that excessive deduction of Delay Damages can reduce the Contractor's cash flow, potentially worsening delays.
This situation requires careful balance between enforcing contractual rights and maintaining project progress.
References:
FIDIC Red Book 2017 Edition, Sub-Clause 8.7 - Delay Damages
FIDIC Contract Manager Study Guide, Module on Claims and Cash Flow Management
NEW QUESTION # 29
Regarding FIDIC Yellow and Silver Books (edition 1999) the Contractor has submitted its design proposal through the Contractor's Proposal. Which two of the following statements are true in this respect, after it has been submitted?
Choose all of the correct answers (multiple possibilities).
- A. The Contractor is not allowed to submit a proposal for Value Engineering, as any value engineering should already have taken place before submitting its design proposal.
- B. The Contractor is not allowed to make any changes regarding the design to optimise the design, unless approved by the Engineer/Employer.
- C. The Contractor is entitled to change the design by optimising the design, without approval of the Employer/Engineer.
- D. The Contractor may submit a proposal for Value Engineering.
Answer: B,D
Explanation:
Option B is correct: The Contractor must obtain approval from the Engineer/Employer before making design changes.
Option C is correct: The Contractor can submit Value Engineering proposals to improve efficiency or reduce costs.
Option A is incorrect; unilateral changes are not allowed.
Option D is incorrect; Value Engineering can be proposed even after initial submission.
References:
FIDIC Yellow and Silver Books 1999 Edition, Sub-Clauses 4.1 and 4.4
FIDIC Contract Manager Study Guide, Module on Design and Value Engineering
NEW QUESTION # 30
Before applying the procurement process of any FIDIC Book, the Employer should always check if there are local procurement rules that also apply. Which one of these responses is correct?
- A. No, because Employers never have specific procurement rules.
- B. Yes, but this is only applicable for public entities like governments. If the Employer is a private organisation (like a company), they are free to procure how they want.
- C. No, because the FIDIC procurement process is universal.
- D. Yes, based on the law system, internal governance or type of Employer additional procurement rules can apply.
Answer: D
Explanation:
Local procurement laws, regulations, and internal governance rules often apply in addition to or alongside FIDIC contract provisions. Employers, whether public or private, must comply with applicable national or sector-specific rules, which may affect procurement procedures, documentation, and contract award processes.
Option C is correct because procurement requirements depend on local legal systems, the nature of the Employer, and applicable governance.
Option A is incorrect as FIDIC contracts provide contractual frameworks but do not override local legal obligations.
Option B is incorrect because many Employers have procurement policies.
Option D is incorrect since private entities may also be subject to procurement laws or internal policies.
References:
FIDIC Contract Manager Study Guide, Module on Contract Formation and Procurement Strategies World Bank Procurement Guidelines and National Procurement Laws
NEW QUESTION # 31
Under the FIDIC Silver Contract (edition 2017), which two of the answers provide for preconditions for certification and payment of the Interim Payment Certificate?
Choose all of the correct answers (multiple possibilities).
- A. The appointment of the Contractor and receipt of the Advance Payment Guarantee, by the Employer, in the form, and issued by an entity, in accordance with Sub-Clause 14.2.1.
- B. Receipt of a statement and supporting documents.
- C. The appointment of the Contractor's Representative and receipt of the Performance Security, by the Employer, in the form, and issued by an entity, in accordance with Sub-Clause 4.2.1.
- D. Receipt of a statement via a letter showing the amounts to which the Contractor considers itself to be entitled.
Answer: A,B
Explanation:
Comprehensive and Detailed Explanation:
Option A is correct: Certification and payment of interim payments are conditional on Employer's receipt of the Contractor's appointment and the Advance Payment Guarantee (Sub-Clause 14.2.1).
Option D is correct: Payment also requires receipt of the Contractor's statement supported by relevant documentation.
Option B alone is insufficient without supporting documents.
Option C relates to appointment and performance security but is not a stated precondition for payment certification.
References:
FIDIC Silver Book 2017 Edition, Sub-Clause 14.6 - Interim Payment Certificates FIDIC Contract Manager Study Guide, Module on Payment Procedures
NEW QUESTION # 32
You are the Contract Manager of the Employer's Representative in a Thermal Power Plant Project. The Contract for this project is EPC Turnkey Contract using the FIDIC Silver Book (edition 2017) with a Contract Price of 28 million USD. The Employer's Requirements require that: "the Contractor design in accordance with international and national technical regulations, and standards, [etc.]".
For piling works, the Employer's Requirements state that the Contractor will design according to a specific national standard for piling works NTS-PW-01. After all piles for the jetty have been installed, a pile load test on lateral bearing capacity shows that actual lateral bearing capacity is much lower than the calculated lateral bearing capacity. It was later revealed by the Technical Standard Committee that there was a typo mistake during preparation of the NTS-PW-01 (translated from a foreign standard). The lateral bearing capacity of installed piles had been substantially overestimated as a result of this typo. Contractor submits a claim for
200,000 USD regarding extra costs for installing additional piles as a result of errors in the Employer's Requirements.
In the hydrological information of Site Data provided by the Employer, the annual high water level is 4.0m.
However, during the design stage, with updated data from local stations along the rivers, the Contractor found out there was a mistake in the calculation. The annual high water level should be 4.5m. As a result, the Contractor has to design and build additional flood walls along the river to protect the Plant from flooding.
The Contractor claims an amount of 300,000 USD to construct the flood wall, based on Unforeseeable difficulties.
As the Employer's Representative, after you have consulted with both Parties but failed to reach agreement, you will make a fair determination of the Claims of the Contractor.
In your "Notice of the Employer's Representative's determination", what is your determination for the Contractor?
- A. The Contractor is entitled to the Claim for the additional flood wall based on Unforeseeable difficulties only.
- B. The Contractor is entitled to the Claim for additional costs in relation to the piling, based on errors in the Employer's Requirement only.
- C. The Contractor is not entitled to either of the Claims.
- D. The Contractor is entitled to both Claims.
Answer: D
Explanation:
Both claims are valid under the Silver Book principles:
The error in the Employer's Requirements (typo in NTS-PW-01) leads to entitlement for additional piling costs.
The unforeseen hydrological data causing additional flood protection works qualify as unforeseeable physical conditions entitling the Contractor to compensation.
Hence, Option D is correct - the Contractor is entitled to both claims.
References:
FIDIC Silver Book 2017 Edition, Sub-Clause 4.1 (Employer's Requirements) and Sub-Clause 4.12 (Unforeseeable Physical Conditions) FIDIC Contract Manager Study Guide, Module on Claims and Employer's Requirements
NEW QUESTION # 33
The FIDIC Books are evolutions of earlier contract models, and although the different versions of a specific model are not the same, familiarity in definitions and structure makes it easier to work with different FIDIC books as well as with their different editions.
Is this statement true or false?
- A. False
- B. True
Answer: B
Explanation:
This statement is true. The FIDIC suite of contracts, including Red, Yellow, and Silver Books, have evolved from earlier editions and contract models, but they retain a common structure, terminology, and approach to risk allocation. This familiarity allows professionals who know one FIDIC contract to adapt more easily to other FIDIC contracts or updated editions. For example, common terms like Engineer, Employer, Contractor, Variation, and Claims exist across editions with consistent meaning.
The modular and familiar structure supports easier contract administration, negotiation, and interpretation.
However, differences in clauses, obligations, and procedures between editions (e.g., 1999 vs. 2017) require careful review. Nevertheless, the shared foundations mean prior experience provides valuable understanding, streamlining learning and application.
References:
FIDIC Contracts Guide, General Introduction and History
FIDIC Contract Manager Study Guide, Module on Introduction to FIDIC Contracts
NEW QUESTION # 34
In the FIDIC Silver Book (edition 1999), if the Employer has instructed the Contractor as per Sub-Clause 8.6 to provide a revised programme to stay within Time of Completion, the Employer can claim additional costs.
This only applies if the revised programme is still too slow to complete the Works within the Time for Completion. Is this statement true or false?
- A. False
- B. True
Answer: B
Explanation:
This statement is true. Under FIDIC Silver Book 1999, Sub-Clause 8.6, the Employer can instruct the Contractor to submit a revised programme to meet the contractual Time for Completion. If, after such instruction, the revised programme still shows the Works will not complete on time, the Employer may claim additional costs (such as delay damages or compensation) due to continued delay.
Thus, the Employer's right to claim additional costs is contingent on the revised programme not enabling timely completion.
References:
FIDIC Silver Book 1999 Edition, Sub-Clause 8.6 - Revised Programme
FIDIC Contract Manager Study Guide, Module on Claims and Delay Damages
NEW QUESTION # 35
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 cannot terminate the Contract.
- 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 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.
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 # 36
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