Cutting Edge Construction Technology, but not Contracts

I recently read a contractual article in one of the major Middle East construction industry magazines. It took me a while to realise what the author was talking about. But it eventually dawned on me that he was using references from the FIDIC 1987 construction contract.

The 1987 contract is now 28 years old and was superseded 16 years ago by the 1999 FIDIC rainbow suite. Whilst I have to criticise the author for not bringing his subject up to date. It is not an unusual occurrence for construction contracts to be entered into based on the 1987 contract. In fact, over the past couple of years, I have been involved with several projects using this form.

Given the cutting edge of construction design and technology used in the Middle East and particularly the Gulf countries over the past couple of decades, I would suggest that if anyone suggested to an Employer that they should revert to 1980’s construction design and technology they would be laughed at.

Why then, do Employers not adopt such an attitude when selecting an appropriate form of contract?

The FIDIC contract was revised to introduce improvements and to keep in line with modern procurement methods. It was also made more equitable by a more balanced sharing of risks between the parties. So why not use the latest version? I have my own theories on this matter.

Firstly, people generally don’t like change so it is more comfortable to remain with something that you are familiar with than learn something new. But come on – it’s been 16 years since the rainbow suite was published. Surely that is enough time to become familiar with the latest versions and train staff on its use? Engineers and Project Managers should be advising Employers on such matters.

Secondly, consultants and Employers possibly don’t like the idea of equitable contracts. This is evident due to the propensity to delete the dispute adjudication board requirements from the 1999 FIDIC contracts when they are used. In my opinion, the unfair treatment of contractors by Employers and consultants is one of the main reasons why the Middle East has been a hotbed for arbitration for several years.

The FIDIC 1999 suite of contracts are currently being revised and new editions are planned to be published in 2017. It is a disturbing thought for me to consider that, based on past performance, by the time that these are in common use in the Middle East, I may no longer be around to see it!

If you wish to learn more about the 1999 FIDIC suite of contracts and in particular, understand how claims may be made under this suite of contracts, please check out our 2-Day Understanding Claims Under the FIDIC Contracts Intensive Training Course. Fee information and how to register can be found on our Dates, Fees and Locations page.