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FIDIC Yellow: Is contractor liable to do anything under IFC in FIDIC yellow book?

0 votes
Contractor has to continually satisfy the engineer‘s requirements which comes from IFC. The cost to the Contractor is getting bigger. Is Contractor entitled to raise a claim?
asked Mar 24, 2019 in Plant and Design-Build Contract Yellow Book by Morris Yang (180 points)  
Assumption: IFC relates to International Finance Corp. (or any other third party) and not issued for construction.

I've seen many instances where compliance to third party standards/documents within a contract causes issues. However, a properly construed contract should have such requirements "frozen" at a point in time. Therefore if the Engineer is referring to requirements from the IFC which were known at the point of contract execution then the contractor has no entitlement to claim. However I have seen those in the Engineer role try to apply future variations of requirements which wouldn't wash. I've also seen clauses in contracts that allow for the latest published version of a third party's requirements to be the valid set - but really legal review should have picked this up to prevent such moving goalposts.
Thanks, Martin for your advice.
We are frustrated to continuously satisfy the IFC in connection to environmental issues. According to IFC’s performance standards and guidelines, there is no quantified samplings and testing specified by these documents. IFC keeps on requesting us do additional samplings and testing for no reason, ignorance of the previous test results which has already shown no adverse impact caused by our construction works. Thus, our cost is increasing and is in excess of the Contract price at tender. We think we are entitled to VO or Claim, but such request has been rejected by the Engineer. The funny thing is that the Engineer could not give substantial clauses to support his determination. Maybe as you said legal review should be in place.
I agree with Martin. If the project is funded by the IFC, the ESMS would be applied to the contract and this should have been included in the pre-agreement information to allow you to provide for costs and time in meeting these requirements.
My opinion is always that if it was not part of the job when you tendered, it is a change of scope or variation of works.

1 Answer

0 votes
I agree with Martin and Rudy above.
answered Jul 27, 2019 by stevencevans (2,680 points)