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more traditional position, see Croudace v Lambeth (1986) 33 BLR 20, where the
Court of Appeal held the Employer liable in damages for failing to replace the
certifier after the retirement of the named person.
A similar distinction may be made with regard to the powers delegated to the
Engineer's Representative under clause 2.3 (Engineer's authority to delegate). If
the Engineer is alive, it is arguable that the Engineer's Representative's powers
are unimpaired. However, the Contractor's ability to question any communication
of the Engineer's Representative by reference to the Engineer under clause
2.3(b) could effectively bring the Engineer's Representative's powers to an end.
If the Engineer died or otherwise ceased to act and the parties are unable to
agree to a replacement, the effects, it is submitted, would be as follows:-
(1) The Employer would not be in breach of his obligation to ensure that the
Engineer exercises his functions provided that he has taken reasonable steps to
propose an alternative Engineer and has not been unreasonable in refusing any
nominee of the Contractor. Compare clause 69.1 (Default of Employer) item (b)
"interfering with or obstructing ...any such certificate".
(2) Nor would the Employer be in breach for failing to pay the Contractor in
the absence of interim certificates. The obligation would probably be to pay when
the works were complete.
(ii) the obligation of the Employer to pay for those works as expressed in
Article 4 of the Contract Agreement or as stated in the Letter of Acceptance or by
implication will also survive. The Employer may, however, have no obligation to
make any payment until the works are complete.
(4) In the event of any delay which is not the responsibility of the Contractor,
time would be at large because of the absence of the Engineer to grant
extensions of time. If all the delay was the Contractor's responsibility, it may be
arguable that clause 47 (Liquidated damages for delay) would continue to
operate as it is not dependent upon the existence of the Engineer, who is not
mentioned in the clause. However, substantial completion is certified by the
Engineer. The Contractor could be liable for breach of an obligation to complete
within a reasonable time, once time was set at large.
Thus it is just conceivable that a project could limp onwards without an Engineer.
Plainly, it is most unsatisfactory and an Employer might be well advised, having
exhausted attempts to agree a new Engineer simply to appoint one and
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thereafter argue, when the Contractor accepts interim payment as certified by the
Engineer, that the Contractor has effectively consented to the new Engineer.
For a discussion on when the Engineer's role comes to an end and he is functus
officio, see under clause 2.1 (Engineer's duties and authority). See also the
comments under clause 67.1 (Engineer's decision).
(b)(iii) "Drawings" - The term is very widely defined. The inclusion of samples,
patents and models is perhaps surprising and produces curious results if taken
literally. For example, under clause 6.1 (Custody and supply of drawings and
documents), the Contractor is to provide for copies. This is one of the occasions
when the opening words of this sub-clause, "except where the context otherwise
requires", will be most relevant. It is also important to appreciate that this
definition is not limited to drawings etc in existence at the time time the Contract
is entered into but refers to all future drawings.
(b)(iv) "Bill of Quantities" - Surprisingly, the only other reference to the prices in
the Bill of Quantities is in clause 12.1 (Sufficiency of Tender): there is no express
indication at all that the prices are to be used for valuation other than in relation
to variations. See in particular clause 55 (Quantities) and clause 56 (Works to be
measured). The 4th Edition no longer contains a reference to the Schedule of
Rates.
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(b)(v) "Tender" - It is important to note that the Tender is a document "as
accepted by the Letter of Acceptance". Thus, it is not necessarily the tender as
submitted by the Contractor but the result of any negotiation prior to the placing
of the order. Any programme included in the tender will become part of the
contract as the tender is a contract document: for diccussion of this see under
clause 14.1 (Programme to be submitted).
(c)(i) "Commencement Date" - This definition determines the date upon which
time begins to run on the project. The notice to commence is not in a specified
form. See generally the commentary to clause 41 (Commencement of Works).
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(c)(ii) "Time for Completion" - This is the contractual completion date as set out
in the contract subject to any extensions under clause 44. Substantial completion
must be achieved under clause 48.1 (Taking-over certificate) by this date, failing
which liquidated damages will be payable under clause 47.1 (Liquidated
damages for delay).
(d)(i) "Tests on Completion" - These tests will often include commissioning and
are referred to in clause 48 (Taking-Over) as being a prerequisite to substantial
completion and the issue of a Taking-over certificate for the whole or any part of
the works for which such a test is prescribed.
(f)(i) "Works" - This term is given an adjusted meaning under clause 49.1
(Defects Liability Period). The definition of Temporary Works is not without
difficulty as set out under (f)(iii) below. As there are dangers in including
Temporary Works in the definition of Works, the draftsman has taken the
precaution of putting flexibility ahead of certainty with the words "or either of them
as appropriate". This reinforces the opening words of the sub-clause "except
where the context otherwise requires".
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an obligation upon the Contractor to provide temporary works exclusively for the
project.
(f)(iv) "Plant" - This is a new definition not found in the 3rd Edition or ICE 5th or
6th. It might be confusing as plant is normally regarded as meaning Contractor's
machinery. Instead, this means the plant to be installed as part of the permanent
works. The Contractor's machinery is now defined as Contractor's Equipment.
(f)(v) "Contractor's Equipment" - In the 3rd Edition and ICE 5th, the Contractor's
machinery is called "Constructional Plant". The current definition is circular with
the definition of Temporary Works. As noted in the commentary to clause 41
(Commencement of Works), this is unfortunate as the failure to commence the
Works is a ground for determination under clause 63.1 (Default of Contractor).
ICE 6th has adopted the term Contractor's Equipment.
(f)(vi) "Section" - The Works may be broken down into Sections and parts. The
difference is that a Section is specifically identified in the contract whereas a part,
which is not defined, seems to be any other sub-division including a sub-division
of a Section. See this distinction in operation in clause 47.2 (Reduction of
liquidated damages), clause 48.2 (Taking over of sections or parts) and clause
48.3 (Substantial completion of parts).
(f)(vii) "Site" - This definition is a variant upon the form used in the 3rd Edition
and ICE 5th. This definition falls into two parts:-
(a) Places provided by the Employer where the Works are to be executed;
and
(b) Other places which are specifically designated in the contract as forming
part of the site.
Compare 3rd Edition and ICE 5th which break down as follows:-
(a) places on, under in or through which works are to be executed; and
The essential difference is that (a) is qualified by the words "provided by the
Employer" in this Edition but (b) contains those words in the 3rd Edition and ICE
5th. One significance of this is that the Employer cannot be in breach of clause
42.1 (Possession of site and access thereto) by failing to give possession of the
site if the site is itself defined as places provided by the Employer. As the Site
will normally be defined in the contract, this should not normally give rise to
problems. Nor, it is submitted, should the omission of the words "on, under, in or
through" create difficulties. If the failure to give possession is the failure of the
Employer to organise the removal, for example, of an underground pipe or cable
conduit, even though the possession of the surface has been given to the
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Contractor, the Contractor's claim under clause 42.2 (Failure to give possession)
should not be hampered by the absence of these words. See also the
commentary under clause 42.1 (Possession of Site and access thereto). See the
comments under clause 42.1 for further discussion of the term "Site". ICE 6th has
added the "other places...designated" formula to the ICE 5th definition.
(g)(i) "cost" - This definition for the first time expressly excludes profit. Thus,
the only occasion on which the Contractor is allowed his profit by the contract is
under clause 69.3 (Payment on termination) where, upon the default of the
Employer, he is entitled to claim "the amount of any loss or damage". This
definition has been adopted with minor amendments by ICE 6th. However ICE
6th expressly permits profit on three occasions in the contract in relation to any
additional temporary or permanent works.
(g)(ii) "day" - This edition has adopted a policy of giving periods of time in
multiples of seven days whereas the 3rd Edition used units of 30 days for longer
periods. Compare, for example, clause 67 (Settlement of disputes) in the two
editions.
(g)(iii) "foreign currency" - It is important to note that foreign currency does not
mean a currency other than the currency in which the Contract Price is
expressed but any other currency than the local currency. Thus, the Contract
Price could itself be expressed in a foreign currency. Part II provides various
amendments to clause 60 and clause 72.2 in relation to currencies.
(iv) "Final Payment Certificate" means the certificate of payment issued by the
Engineer pursuant to Sub-Clause 60.8.
Whilst it is no doubt a good idea to have defined terms for interim and final
certificates, the definition of Interim Payment Certificate raises the question as to
which clauses other than clause 60.2 (Monthly payments) will give rise to interim
payment certificates. The definition could and, it is submitted, should simply
have referred to certificates issued under sub-clause 60.2.
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but are not the certificates for payment themselves. Under clause 59.5
(Certification of payments to nominated Subcontractors), the Engineer certifies
payment to nominated subcontractors where the Contractor fails to supply proof
that previous sums certified in relation to nominated subcontractors' work have
been passed on. Such certificates fall within the definition of Interim Payment
Certificates. The certificate under 63.2 (Valuation at date of termination) is a
certificate of value only and not a certificate for payment. In contrast, the
certificate under sub-clause 63.3 (Payment after termination) is a certificate of
payment and falls within the definition of Interim Payment Certificate despite
being final in nature. Curiously, a certificate under Sub-Clause 63.3 could show
a balance in favour of the Employer. However, such a certificate is deemed to be
a debt and is not strictly therefore a certificate for payment.
Within clause 60 (Certificates and payment) there are certificates under sub-
clause 60.3 (Payment of retention money), sub-clause 60.5 (Statement at
completion) and under sub-clause 60.6 (Final statement) where part only of the
Contractor's draft final statement is not in dispute.
Clause 60.3(a) has always raised the question whether the release of the first
half of the Retention Money following the issue of the taking-over certificate
should be the subject of a special payment certificate or included in the next
monthly interim certificate. Practice varies but more often than not, the first
moiety of retention is released in the next interim certificate. The fact that the
certification falls within the definition of Interim Payment Certificate, does not
resolve the issue.
The entry in the Appendix for the "minimum amount of interim payment
certificates" applies only to clause 60.2 and does not therefore restrict small
payments under other payment clauses despite the application of the definition.
As is plain from the list of the amendments contained in the 1992 re-print, and
the extracts set out later in this supplement, the definition has not been used
wherever it is applicable. The term is now used in sub-clauses 60.2, 60.4
(Correction of certificates) and 60.10 (Time for payment).
Perhaps surprisingly, the result is that three interim payment certificates could be
issued in the same month under clauses 60.2, 60.3 (Payment of Retention
Money) and 59.5 (Certification of payments to nominated Subcontractors).
Under clause 69.1 (Default of Employer), interference with the issuing of certain
certificates is a ground for the Contractor to terminate his employment. The
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relevant certificates are those for which time-limits for payment are given under
clause 60.10 (Time for payment). The effect of the definition of Interim Payment
Certificate and the application of that definition to a number of certificates other
than monthly certificates under clause 60.2 (Monthly payments) has been the
extention of the scope of the interference ground for termination. For example,
interference with a certificate under clause 59.5 (Certification of payment to
nominated Subcontractors) would not have been a ground for determination
hitherto. Whilst interference with any form of certification is plainly contrary to the
spirit of the contract, it is unlikely that the draftsman intended to enlarge the
ground for termination to such an extent.
1.3: Clause 1.1(a)(iv) defines the Engineer as "the person appointed...". This
sub-clause is a reminder in relation to the Engineer that the Employer may name
a firm of Engineers as distinct from an individual. In view of the lack of any
provision for the replacement of an Engineer who dies or retires, this course may
be adopted more often.
1.4: This is a standard clause and was contained in the 3rd Edition and ICE
5th.
1.5: This clause is new and puts beyond doubt what may have been implicit
from clause 68 (Notices) that notices, consents etc must be in writing. Writing is
also required by the following clauses:-
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clause 48.1 Undertaking to finish outstanding work
There are additional references to written instructions but clause 2.5 (Instructions
in writing) makes this plain.
A comparison of this clause with clause 2.6 (Engineer to act impartially), clause
67.1 (Engineer's decision), clause 67.3 (Arbitration) and clause 68 (Notices)
reveals an inconsistency in the use of terms such as notices, consents etc.
Table 6 indicates the clauses in which the various terms appear.
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CLAUSE 2 : Obligations of the Engineer
This clause sets out the powers and obligations of the Engineer and his team.
The Engineer will carry out his duties and exercise the authority given to him by
the contract but is to obtain the prior approval of the Employer before exercising
his authority in relation to the list of items in Part II. The Contractor does not
have to check that the necessary approval has been given. The Engineer has no
general authority to relieve the Contractor of any of his obligations.
The Engineer may appoint and delegate duties and/or authority to the Engineer's
Representative.
The Engineer and his representative may appoint assistants and inform the
Contractor of their duties and authorities. The assistants may only give
instructions necessarily within the scope of their duties and to record their
acceptance of work, material etc. Such instructions are treated as having been
given by the Engineer's Representative.
The Engineer must act impartially in exercising his discretion. His decisions may
be reviewed by an arbitrator.
This clause has been substantially re-cast and reorganised. Sub-clauses 2.4 and
2.6 are wholly new to the 4th Edition.
2.1: It is a novel feature of the 4th Edition that the Employer is unable to
replace the Engineer should he die or for any other reason cease to carry out his
duties. For a discussion of this, see the commentary to clause 1.1(a)(iv).
(a) As the Engineer is not a party to the contract, this clause must impose
upon the Employer an obligation to ensure that the Engineer duly performs.
Under English law, this duty is taken to be to ensure that the Engineer certifies
where the contract requires a certificate or makes decisions where the contract
gives the Engineer a choice whether to act or not. The Employer is not held
responsible for the contents of the decision i.e. he has no obligation to ensure
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