Omission of Items Included in the Bill of Quantities, But Not Shown on the Drawings
Bills of Quantities, Omissions and Claims: I recently received a request for advice from one of our course attendees. It related to the Bill of Quantities and later drawing issues. This topic has arisen on several occasions so I thought it worthy of a blog. The situation and query was as follows:
The Contract is a lump sum and not subject to re-measurement. The Bill of Quantities (BoQ) was prepared by the Contractor at the tender stage.
During the course of project closure, some items listed in the BoQ were omitted. This is because the items were not included on tender drawings, shop drawing or final as-built drawings.
However, the Client deducted these items as an omission at final account stage. They stated this was because the Contractor did not complete any of these billed works. The Contractor disagrees with this and asserts that he took the risk on the lump sum contract and the Bill of Quantities was merely for guidance and valuation only.
So…
What are the Contractor and Client’s entitlements under FIDIC for this kind of a situation?
What should be the stance of the Contractor on this matter?
Is the Client entitled to omit the value of the BoQ items not fulfilled by the Contractor despite it being a lump sum contract?
My reply was as follows:
This a fairly typical scenario that I have come across on several occasions and arises from the Employer/Engineer wanting both to have his cake and to eat it too.
The Devil is in the Detail…
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Please share your case studies .
Thank you so much in advance.
Could you share your case studies concerning the subject.
Thanks and regards,
If you submit your details via the form, you should receive the case study automatically. If not, do get in touch by email.
In a lumpsum contract an item shows in the architectural drawing but not shows in the respective structural drawing, the construction cost of structural part could claim to contractor or not?
In a lump-sum Contract, scope of work is the governing principle.
Any deduction for non-performance should be gauged upon actual requirement which is not the case.
I had a similar case in our project. Can you please share the case studies here, too?
Thank you
Hi there – if you pop your details into the form, you should receive the full article.
Im interrsted in reading the case study, please share
kindly share the case studies
Hi there, The full article can be downloaded by entering your details in the box above. Do get in touch by email should you have any questions.
A contractor has offered discount % at the total quoted price.
During the conatruction time, certain items were omitted. Subsrquently, comtract sum reduced. Contractor claiming his quoted price had higher profit in the particular item . Due yo omission , he is unable to give any discount further. Is his claim reasonable. How yo assess yhe discount in such case.
Could you share your case studies concerning the subject.
Hi there, you should find that if you complete the sign-up form, you will automatically receive more information.
This is really a helpful topic.
I would like to know if reducing the quantity of an item in a BoQ is appropriate on a lump sum subcontract.
The scenario is that that the contract quantity was established based off construction drawings but during the project execution, part of the work on the same line item was omitted because the material was changed and the work will be awarded to others. For this, the engineer deducted the omitted work on our payment.
Seek some advise please.
Hi, may I have the case studies?
Hi Jessica – of course, just put your details into the form at the bottom of the blog post and they’ll be emailed automatically.
kindly share the case studies
Hi Ahmed – if you enter your details in the box above you’ll receive the case studies automatically via email. Thanks, Nina.
Dear,
Currently we facing the similar case. Please share with us your case studies.
Thanks,
Hi,
Could you please share the case study with me.
Thanks in advance
Regards
Nuski
Dear Nuski,
Many thanks for your message and request. I will send the case studies to you today.
Many thanks and best regards
Tarryn
thank you very much.
Hi,
Those Case studies please
Dear Amazir,
My apologies for the delay in getting back to you. I will send the case studies to you today.
Many thanks and best regards
Tarryn
Very invaluable debate and very much interested in receiving the case studies. Please!
Hi Suliman, thank you for your comment and interest in our case studies. I’d be happy to share them with you and will send via email shortly. Regards, Tarryn
Could you please share them at my e-mail. I’d be very grateful!
Thanks
Dear Suliman,
Many thanks for your message and request. I will send the case studies to you today.
Many thanks and best regards
Tarryn
Thank you for your insight. Could you please send me copies of the case studies. Many thanks. Sarah
Hi Sarah, thank you for your comment and interest in our case studies. I’d be happy to share them with you and will send via email shortly. Regards, Tarryn
Hi Andy,
Thanks lot for your valuable services.
I still can argue other way as well on your opinion. Kindly comment on my view.
What if BOQ contains an item that is physically not present on site (or not required to do even at the tender stage) and it is not shown in the drawings and specifications?
A Lump Sum contract is simply what it says it is. The Employer promises to pay the Contractor a Lump Sum Price for what the Contractor has agreed and promised to execute. What constitutes the scope which the Contractor has to do to be entitled to receive the lump sum will be contained in the documents or reasonably implied there from.
The argument usually is the place of the BOQ in the contract. Contractors insist that in a lump sum contract if an item is measured in the BOQ it does not matter whether the item is required or not they need to be paid the full contract sum, as the basis of a lump sum contract.
This is only correct if the BOQ is not part of the contract.
Even where the BOQ is a contract document and complementary with other documents Contractors put forward the same argument. This argument is founded on the basis that the Contractor will have to execute work not measured in the BOQ or shown elsewhere but required without any additional payment as part of the lump sum contract. Where the BOQ is a contract document it is meant to describe the scope for which a price has been submitted and this is settled law. The Contractor cannot be unjustly enriched for work that he has not executed.
The item not fully executed can be deleted by the Engineer from the BOQ and the contract sum adjusted accordingly. Of course if the Contractor can prove that he priced the item in question to compensate for any missing items he would be entitled to be paid this item as a variation. If such proof is available, then the Contractor will also have equitable legal remedies.
REMEMBER THAT IF THERE ARE NO SUPERFLUOUS ITEMS IN A BOQ AND THE CONTRACTOR HAS TO EXECUTE ALL THE ITEMS IRRESPECTIVE OF ANY DISCREPENCIES IN QUANTITIES THE CONTRACTOR IS ENTITLED TO RECEIVE THE FULL LUMP SUM CONTRACT PRICE.
Clause 2.14 of the JCT 2011 With Quants allows the PQS to adjust / correct any errors even within a lump sum contract.
Your thoughts would be interesting.
Hi Andy,
Thank you very much for your excellent explanation. I would like to kindly request for the case studies.
Regards,
Jaime
Please share as many as case studies on the subject and other topics as well.
kindly we would appreciate if you send me the two study cases you’ve mentioned
thank you
Hi Sir,
Your blog very interesting for me. The BoQ is usually stated in the contract to be an estimate, not to be relied upon and only to be used for evaluating monthly progress and variations. I have further questions on this matter:
Contract sum in BOQ rate based on lump sum (1 lot) without detail breakdown quantity and Unit Price.
For example: Cabling works – 1 lot – 1M.
But during additional and omission shall be based on Schedule of Unit Rate:
Due to overall design changes there was addition and omission breakdown to identify and submit the cost to client.
The problems are:
1) Total contract amount 1M not same with detail breakdown with Schedule of unit rate (markup 50%) and cost becomes 1.5M
2) The additional cost based on Schedule Unit Rate becomes 3M
3) Cost different based on schedule unit rate is 1.5M
4) But client insists to rationalise the unit rate to ensure tally as per Contract Sum of 1M.
What is the contractual view on this matter?
If Addition will profit side but omission is loss side.
If omission from Contract sum is 500K but based on Schedule of Unit Rate the omission is 750K.
What is your opinion?
Can you also share the case study with me please?
Regards,
Shful
Dear Sir,
I would appreciate it if you could share these case studies with me.
Thank you
Regards
John
Hi,
Could you please share the case study with me.
Thanks in advance
Regards
Ram
Both drawings and BOQ form part of the contract documents and so whichever stringent shall apply accordingly for a lump sum contract unless it specified/clarified during tender stage (recorded black and white).
To: Ali Elbanhawy. To add the price of the higher valued item and deduct the reasonable expectation would be correct, provided the Engineer knew or should have known he would be charged for the betterment,
The Contractor made the stainless steel fence with glass as instructed by the Consultant and he is now claiming its cost as part of the variation of other work in the same area. So, if that fence was supposed to be of a more reasonable design what can we do? Pay the actual cost of the stainless steel fence and deduct an estimated cost of the reasonable one?
I would be truly grateful for Mr. Hewitt’s feedback to my January 26, 2018 query. And I thank all who have contributed comments.
The contractor is not entitled for additional cost unless he has qualified during the tender and priced and included as stainless steel fence in the bq
In a lump sum contract a rectangular area is shown with two border lines without any specifications. will the contractor be entitled for cost of a stainless steel fence as required by the supervision consultant around that area?
Why is the fence of stainless steel? If nothing is specified, then an ordinary stock design to a reasonable standard would surely have sufficed,
Stainless steel has been used because there is an item for it in the BOQ and to match adjacent/nearby building façade as explained by the supervision Consultant.
In reply to Ali Elbanhawy’s post of 14 February.
Sorry for the delay, but I was in Norway conducting a training course.
I think I am correct in assuming that you are working on the consultant’s side of the fence and that therefore, you do not wish to pay what you consider to be an exorbitantly high rate for a variation. I have a few observations to make on this matter.
Firstly, why did the party responsible for tender evaluations not pick this up before the contract was entered into? Any half-competent cost consultant would have performed a comparison of at least the three most competitive tenders to identify things like this. Had this exercise been carried out, the rate could have been negotiated and replaced by something more realistic. I fear that this is another example of taking short cuts or saving money when finalising the contract, which come back to bite the parties during the execution stage and could conceivably cost the Employer a significant amount of money.
Secondly, if we take the FIDIC Red book as an example of how variations should be evaluated, Sub-Clause 13.3 (Variation Procedure) directs us to evaluate variations in accordance with Clause 12 (Measurement and Evaluation). Sub-Clause 12.3 (Evaluation) states ‘For each items of work, the appropriate rate or price for the item shall be the rate or price specified for such item in the Contract’, so it looks as though you will have to use the rate that ‘is extremely high’ for the evaluation.
Thirdly, FIDIC does provide a get out clause in some circumstances and Sub-Clause 12.3 (Evaluation) goes on to say ‘However, a new rate or price shall be appropriate for an item of work if: ….’ FIDIC then provides a list of circumstances that may allow a new rate or price to be used. From the information provided, I can’t tell which conditions may apply, but on the face of it sub-paragraph (b) seems to indicate that you cannot change the rate even though although this is a variation, because there is a rate specified in the Contract and the work is likely to be of similar character and executed under similar conditions.
Fourthly, as a consultant, please ask yourself how you would react to a contractor who asked for extra money because he significantly under-priced something.
I hope this helps.
Andy
Dear Andy,
Thank you very much for the clear and comprehensive answer. Yes, I am the Consulted appointed at a late stage after the first Consultant was terminated. I fully agree with your second paragraph. We got now all kinds of problems from what happened before signing the Contract.
I will check FIDIC to find out the appropriate sub-para and will also try with the Contractor to reach to an agreement with him on a reasonable rate.
Thanks again.
Thank you Nina.
I understand that the quantities in the BoQ may be estimates only, but that does not necessarily mean that the BoQ itself does not detail scope.
Say: the BoQ has an item / items for dewatering and these are priced by the Contractor. However, the GI details show that dewatering will not be required at all.
Can the Engineer issue an instruction omitting the dewartering item?
The relevant documents are equal in this case.
Thanks to all for comments.
Interesting debate, can you please share the two case studies?
Hi Jade – thanks for your comment. Happy to share the case studies with you; I’ll issue both via email shortly. Regards, Nina.
Q.to Elly Grace, Did the Contractor make any reservation in the Tender?
Is the work materially different from anything that reasonably could have been inferred from such inspection as could have been made in the time allowed before tendering?
For any entitlement to an extra price, I think the answers to both questions must be ‘Yes’.
the Contractor is claiming extra cost associated to leveling substrate. Tender site walk was not able to identify what’s underneath the existing flooring. But the drawings have notes basically tell the Contractor to level the substrate after demo of existing flooring. Contractor claims site conditions is beyond industry standard. Owner is not willing to pay any additional fees. Is the contractor entitled to claim extra?
Please share the two case studies.
Elly, here’s my thoughts:
1. In the first instance unless the “industry standard” is part of the Contract then the Contractor has contracted to level the substrate as part of his lump sum, and therefore not entitled to additional costs.
2. Having said that, if a tender site walk was undertaken in which the parties attempted to ascertain the extent of leveling but were unable to do so, and as such the Contractor had to make an assumption and in doing so used the “industry standard”, if any such measure exists, then perhaps the Contractor could pursue a claim on an ex-gratia basis for additional works not contemplated by the parties, provided the Contractor can demonstrate that such was clearly in suficient excess to be beyond the reasonable assumption of the parties. In any case, put it on the table for further discussion during final account.
Can anyone here give me some advice? What happened in my case is that there are items exceeded its quantity according to the given bill of quantities e.g Bill of quanties Item 311 – 2,816 sq.m actual 1,816sq.m only
Hello Nina,
In a lump sum Contract there is an item which is priced extremely high (ten times the market rate) in one of the two buildings in the project. For a similar item in the other building the unit is entered wrongly by the designer as “number” not “meter” as should be and it does not make sense to use it. We want to carry out a similar item as a variation. Can we ignore the excessively high rate and use a new rate?
Hi Ali – thanks for your comment. I’ll ask Andy to provide a response. Regards, Nina.
Very useful information, can you please share the two case studies?
Hi Mohammed – pleased to hear that you’re enjoying the blog. I’ll be happy to send the case studies to you, please expect them in your inbox shortly. Regards, Nina.
Great discussion on lump sum contracts. On the subject of omitting works that were not performed and/or the omission qty is greater than that shown in the BOQ I find it hard to argue the “this is a lump sum” position when invariably in Contracts:
1. There are Tender adjustment schedules or similar mechanisms in bidding docs that allow bidder to price in / adjust BOQ’s in their bid that then become part of the contract, albeit perhaps lower in precedence that drawings and/or specs;
2. the contract contains in the GTC or STC’s the right of Client to vary the works via Change instructions e.g. additions and/or deletions.
3. In the case of Omission of Work not performed, as mentioned above, why should the Client pay for Work that was never done, particularly if clearly shown on drawings and detailed in bills, but for whatever reason the work was/is not to be executed under the contract.
It seems quite often the Client just exercises his right to vary the works and issues an instruction to omit that portion of the Works.
I’m not sure I’m seeing anything in the above discussion that would fully counter the Client exercising this right.”This is a lump sum” doesn’t seem to swing it for me?
Appreciate your thoughts.
Would also appreciate a copy of the 2 x case studies.
K.R.
mickd
Hi Mickd – thanks for your comment, I’m sure our readers will provide some use advice / insight for you. In the meantime, I’ll get those case studies across to you. Regards, Nina.
Someone here can give me an advice? Wat happened in my case is this there are item exceeded its quantity according to the given bill of quantities e.g Bill of quanties Item 311 – 2,816 sq.m actual 1,816sq.m only
Could you please share the case study with me regarding the above.
Hi Nimisha – happy to share the case studies with you, I’ll email them across shortly. Regards, Nina.
@isam, although the quantity is high/low your rate refers to the drawings or specification as it defines the scope and the priority in documents hierarchy is high. Since it is a lump sum contract the BoQ price will not be omitted but for variation you should stick to drawings, compare them and seek out the amount difference by relevant rates, e.g. insitu quantity in drawings. *insitu rate (with all conc reif formwork etc.) amount – precast amount × rate. If you are on contractor’s side enjoy the higher quantity mistake done by the consultant as it is a lump sum contract.
What if Drawing has the Quantity of Precast Concrete more than specified in the BOQ? You cannot omit more than specified in the BOQ Right?
@Haneefa
Whatsoever the quantity in BOQ the rate is referred to drawing/ specification qty. The Contractor is obligated to refer drawings and specifications during tender stages and price as per drawing qty because at the end of the day he has to execute as per drawing. Since Omission are allowed in Contracts eg. Fidic 99 . Must see the particular conditions
Yes I agree that it is correct for one type of contract in Lump sum where BOQ is not part of Contract. There are cases where BOQ is part of the contract and in that case we have to approach differently…
Thank you bloggers!
It’s a great help to all the QS who are facing the same scenario.
Disputes with the Clients in terms of Variations.
Dear Andy,
Thank you. Could you please share the two case studies?
Stephen
Hi Stephen – thanks for your comment. I’ll share the case studies via email shortly. Regards, Nina (for and on behalf of Andy).
@Isam Logically, what has happened is that a part only of the item has been built so that it would be appropriate to reduce the item accordingly. An alternative, allowing for the different method, would be for Employer and Contractor to agree on the omission of the entire item and to add the actual value as a new item.
The contract is to supply the item. Provided the quality is equivalent, the method of manufacture is up to the Contractor.
But I’m no lawyer.
The quantity of a structural element in precast concrete was far greater than that shown on the drawings. Ultimately, it was constructed as cast-in-situ for which a rate was available on the lump sum FIDIC contract.
In assessing the variation, would the quantity under the precast concrete item be omitted in full or only the actual quantity indicated on the drawings?
Also, I would appreciate a copy of the case studies.
Hi Isam – thanks for your comment. Hopefully some of our readers can provide some guidance. I’ll send the case studies via email shortly. Regards, Nina.
@Isam The phrase to be highlighted “The quantity of a structural element in precast concrete” meaning there can be other elements still done as precast:
Case 1: If The item you are going to omit is unique and specifically quantity inserted and you are changing to Insitu fund allocated to the item should be omitted regardless of the quantity.
Case 2: The item you are going to omit is part of other elements in which BoQ Quantity is inserted; then All elements can be measured as per Tender drawing and equaled to the BoQ Quantity and only the proportionate part of the quantity can be omitted as omission.
Check at the same time this changing the item requires any additional work to be required like waterproofing, if so it should be added to scope to cover the cost.
Hi Isam,
Response from Andy:
If I understand correctly:
It is a lump sum contract designed by the Employer
A structural precast concrete element was over-measured in the BoQ
The BoQ was stated as being an estimate only
The design changed the element from precast to insitu concrete
Remembering that the lump sum price includes for what is shown on the drawings, the omission would be for the precast concrete measured from the contract drawings at the BoQ rate.
The addition would be for insitu concrete measured and evaluated at the appropriate rates from the BoQ.
What we must remember in situations where the contract BoQ does not accurately reflect the contract design, is that in most cases, the Employer or his agents prepared the BoQ and thus had the opportunity to do this accurately. If inaccuracies cause conflicts or ambiguities, the interpretation must be the one most favourable to the Contractor. Check out the principle of contra preferentem. Of course, engineers, who are often the parties responsible for preparing the inaccurate BoQ’s will try to argue against this, but this principle is supported by law.
I hope this helps.
Hi. Would appreciate if can email the case study. I have similar conditions here where Quantity of earthworks in BOQ is less than actual needed for in a Lump sump contract resulting the contractor attempting to claim the difference.
Thank you
Allan
Hi Allan – thanks for your comment and interest in the case studies. I’ll issue them via email shortly. Regards, Nina.
I concur with Vijay in that Akila appears to have no rate for the work actually carried out (to be carried out?). A new rate must be agreed with the engineer. It could be discussed with the DAB if it’s in place. Does the job warrant 100 mm or 150 mm? This question preeminently is not a legal question but a commonsense one. If the spec or notes say 150 mm Maximum, that seems to be a boundary, a limit for the nominal 100 mm of the drawing
Doesn’t Akila say to the Engineer, ‘Tell me what you want and I’ll price it.” Arguably that would be based on time and materials. If the BoQ differs, tant pis!
Exactly that is my point of view and u have got it right laymen . (There is a limit for a mistake, and the mistake is clearly seen where no rate for 100mm in Contract). If we the Contractor has identified the matter regarding the Contradicton in drawings and BOQ he should be obligated to adjust it and make changes in BOQ as per Spec and Drawings. The Mistake has been done and the Punishment is over. A new rate should be derived . Than you
First of all i would thank for replying and sharing the case studies .
I refered and it added knowledge but i didnt able to find the answer for my problem.(lump sum contract designed by the employer -fidic 99)
Problem- the contract drawings mentions 100mm sand binding and spec notes maximum 150mm sand binding and boq 50mm sandbinding description is there but no for 100mm. No question that it is a lump sum contract we the Contractor is obligated to execute contract drawings and specification as per priority of documents.
Then employer issues new drawings and engineer instructs for the variation to submit the qty variation.as per new drawings additionaly 100mm sandbinding is given for new areas or beyond the contract drawings.at the moment no rate for 100mm sand binding. And engineer ask to performthe additional areas to 50mm sand binding.
I need guidance to facilitate my argument. My answer is no.we are not suppose no suffer for the mistakes in addition beyond the contract drawings and moreover my view is no rate is given for 100mm sand binding.50mm sand binding is an guideline we suppose to use as per the condition ofcontract were it is an evaluation guidline. So please mention your comments and how to derive the rate for 100mm.is it that we should substatiate a new rate or derive from 50mm i think it is more convineant.what is the entitlement in contactors point of view
BOQ doesn’t define the scope, and drawings needed to be read in conjunction with the specific specifications/ relevant specification, in above case no variation to be issued as the Contractor doesn’t clarify the ambiguity during tender stage. the BOQ is having rate for 50 mm or 150 mm, doesn’t matter as work needed to be as per drawings, even if BOQ does not have item, the contractor have obligation to execute such work.
Yeah true and it is the obligation of contractor to execute in drawings irespective to the boq.no argument in it. But my question is when client add the scope or expand the scope does the contractor have to execute under a mistake under taken in tender stage .
Extremely valuable article. Please send me the two case studies
Hi Akila – thanks for your kind comment. I’ll send the case studies to you shortly. Regards, Nina.
Hello Nina,
Thank you for publishing this article. I realized that this is indeed most common dispute that arises in every project. I am also facing the same problem.
Hence could you please be kind enough sending me the case studies please? so that I can refer and look on how to take it forward.
Thank you
Sandeep
Hi Sandeep – sure, no problem, I’ll send the case studies via email shortly. Thanks, Nina.
Hi, I have found the blog interesting and informative. Can you provide me the the 2 case studies?
thank you
Hi Selam – pleased to hear that you’re enjoying reading our blog. I’ll send the case studies to you via email shortly. Thanks, Nina.
Could you share your 2 case studies related to this topic?
Thanks in advance.
Hi Ahmed – apologies for the delay, I’ve just returned from holiday. I’ll issue the case studies via email shortly. Thanks, Nina.
I would like to review the case study.
Thanks a lot.
Hi Adel – apologies for the delay, I’ve just returned from holiday. I’ll issue the case studies via email shortly. Thanks, Nina.
Hi, I just found this website, and it’s very informative. Can I have both case studies please? Thanks
Hi Faisal – thanks for your comment. I’m currently on leave without access to my laptop. I’ll send the case studies to you after 4th Dec when I return. Thanks, Nina.
Hi, can I have both case studies please?
Hi Aysel – yes of course, I’ll send via email shortly. Thanks for your comment, Nina.
Common but evergreen matter in the industry.
May I also have the case studies, please…?
Thanks!
Hi Mircea – of course, I’ll send via email shortly. Thanks for commenting! Nina.
Please share the case study
Hi Magdy – thanks for your comments, I’ll share the case studies with you via email shortly. Regards, Nina.
This a very helpful, informative and interesting blog.
Appreciate sending me the case studies please
Hi Hazem – Pleased that you have enjoyed the blog. I’ll send the case studies to you shortly via email. Regards, Nina.
Quite an interesting topic and informative debate by others with similar experience in handling this, which I personally have same issued in hand.
I would like to receive the case studies in order to understand further on this
Hi Shaiful – thanks for your comment, I’m pleased the article has been useful for you. I’ll send the case studies across shortly. Regards, Nina.
Common issue and clear explanation. Thanks Andy.
I’m interested in reading the case studies.
Hi Mazen – thanks for your comment. I’ll send the case studies to you shortly. Regards, Nina.
Very detailed explanation. Could you perhaps send the case studies to me.
Hi Judy – thanks for your comment, I’ll send the case studies shortly. Regards, Nina.
Dear Andy,
Could you share your case studies concerning the subject.
Sincerely,
Lina
Hi Lina – thanks for your comment; I’ll send the case studies via email shortly. Regards, Nina.
Very interesting topic and article. Even happening so often, it is not easy to find clear commentary or legal analysis about omitted works. I would be delighted if you share the case studies please. Thank you very much
Hi Laurens – thanks for your comment and pleased that you enjoyed the article. I’ve just sent the case studies to you via email. Regards, Nina.
In my opinion, omitted works are a factual rather than a legal matter:
Are there items in the scope of the Contract that were omitted?
Were they omitted by instruction or agreement – if not, why?
Have any goods or labour been expended on the omitted Items?
Can it be shown that profit would have been made and is now lost?
Those seem to be the questions to be answered – preferably by evidence rather than argument.
Well detailed clarification for a common problem.
I am very interested in reading the case studies.
Regards,
Hi Mohamed – thank you for your comment, I have sent the case studies via email. Regards, Nina.
Thank you, and appreciate your prompt response, however, I would prefer to receive the case studies by Email, for future reference.
Hi Maher – Good to hear from you again. Hope you have been well since we met in Abu Dhabi. Sorry for the delay on getting the case studies to you, I’ve been on holiday. I’ve just sent them via email. Regards, Nina.
Dear Nina,
First of all I really appreciate the great efforts in your blog and thank you and thanks to all participants for considering all questions.
After opening the technical and financial envelopes of the tender of a lump sum contract and during the negotiations with the Contractor it was agreed to pay part of the contract sum in hard currency and the Contractor was instructed by the employer to submit a new BOQ reflecting this. In the new BOQ which was approved by the Employer the Contractor added “additional items”, which was allowed in the original BOQ to cover any missing items or low quantities. My questions are:
1- If the Contractor refuses to provide more details of why he added those items and where they are going to be used, giving a reason that this is a lump sum Contract and not a re-measured Contract. Can the supervision Consultant insist that the Contractor submit details of those items?
2- Can the Employer omit any item of those additioal items if the quantity in the shop drawings is within the original BOQ quantities?
3- If the Contractor was required in the tender documents to make a bypass of service lines of a specific route and the quantities of that bypass were detailed in the BOQ, and it was decided during construction stage with the supervision consultant agreement to make a much shorter bypass using existing pipes and cables which will fit the purpose, can the employer omit the unused quantities?
Your advice is much appreciated
Regards
Hi Ali – thanks for your comment and I’m pleased that you are enjoying the blog. I’ve passed your comment onto Andy for a response and I’m sure some of our other commenters will weigh in too.
To Ali Elbanhawy, may I say that the intention of the Contract is that the Employer should receive pay for the goods and labour at a price agreed with the Contractor? If there is more to the works he should pay more; if less, less. In a Lump Sum Contract, the BOQ is to enable progress and any variations to be valued,
If I may say so, a Contractor who doesn’t explain or account for unspecified additional items, the Employer, not knowing about them, might not pay for them. It’s a risk you take.
Thank you very much for this clear explanation.
So as a Consultant I will omit the Contractor additional items which I do not have details about them from the Contractor. Also, the unused lengths of pipes and cables because of making a shorter bypass will be omitted.
Thanks again
When concluding a FA on a Lump Sum contract, what are the rules when drawings are changed and items removed from a Contractor’s package please?
The BoQ stipulates a total meterage which is not a true reflection on the site installation. The Client will not pay for the extra measure, but is wanting to deduct quantities for the design change.
My head is hurting on this miserable Friday morning so would really appreciate some advice please.
This discussion is really interesting and has enhanced my knowledge thanks to all the participants. In our project (based on a Lump Sum Contract) the owner omitted one of the buildings out of 7 buildings in the contract, the omitted building was priced in separate BOQ as all the buildings priced in separate BoQ for each building. Preliminaries/General requirements for the whole project is priced in separate bill. My question is what will be the liability/impact of this omission to the Contractor? Contract is based on FIDIC (Clause 51 and 52 quoted by the Owner). Please give me your advice.
Moreover please can you provide me the above said two case studies which will help me a lot.
Thank you.
Hi Mohammed – Thanks for your comment and for reading our blog. I’d be happy to send the case studies to you and you will receive them shortly. I’ll leave it to the other comment participants to provide advice on your enquiry. Regards, Nina.
@Mohammed
In my [Engineer’s] opinion, if the 7th building was part of the contract price and omitted, one would expect the contractor to receive any lost profit. If it was no more than an option, then nothing is due unless the contract says otherwise. Any preparatory work should be paid.
Hi A Layman,
Thanks for your comments. in our case no work has been started.
Hi Andy,
This is very common scenario in terms of Lump Sum contract.
Please share your case studies.
Hi Shamilka – thanks for your comment. We’ll get the case studies out to you shortly.
Hi There,
This is very interesting, could you please send me the case studies to enggwaleed@gmail.com
Best Regards,
Muhammad
Hi. The BOQ of a lump sum contract states that the Contractor has to provide a car with driver for the use of the PM during the construction period. There is no rate against this item. There is nothing mentioned in the specs about this car. Can the employer omit this item in the middle of the construction period and deduct an estimated amount from the beginning to the end of construction period?
Thanks.
Hi Ali,
The important thing to consider here is what the contractor has agreed to do as part of his contract.
If the bill of quantities is a contract document, then the contractor has agreed to and is obliged to provide a car and driver for the duration of the construction period.
If the employer has decided that the car and driver is not required and the contractor has not provided them, the employer can omit this item from the contract and the lump sum price should be adjusted accordingly.
As this item is not priced separately, the amount of the adjustment should be calculated based on the reasonable cost of providing a suitable vehicle and driver. Obviously this will be subjective, so it will be necessary to use common sense here. The period used for the calculation would be the duration of the construction period, because this is the period that the contractor agreed to provide the car and driver for when entering into the contract.
I hope this helps.
Thank you very much Nina.
Hi there,
This is a really good read. Can I please request for the 2 case studies. Thanks.
Hi Hanim – thanks for your comment; pleased to hear that you’ve enjoyed reading our blog. I’ll send the case studies to you via email. Regards, Nina (GM – Claims Class).
It would be appreciated if you can share the two case studies on this topic.
Thanks and best regards
Hi Victor – thanks for your comment, I’ve just sent the case studies across to you. Best wishes, Nina.
Hi,
This is really interesting topic and largely debated in many projects. Would like to see the case studies. Share me on nagasunil12345@gmail.com.
Thanks in advance.
Hi Naga – thanks for your comment. We’ve sent you the case studies!
Hello,
The blog was very interesting and informative.
Can you provide me with the case studies please.
Thank you
Hi Nick – thanks for your comment. We’ve sent you the case studies!
HI,
Could you please send me the case study to aitsimohamed@gmail.com
Best Regards,
Mohamed
Hi Mohamed – thanks for your comment. We’ve sent you the case studies!
Hello,
Could you please assist with the two case studies?
Thank you.
Hi Zait – please check your inbox for the case studies. I hope they come in useful for you.
HI,
Please send me the case study to thameem-ansari@outlook.com.
Regards,
Thameem
Hi Thameem – please check your inbox for the case studies. I hope they come in useful for you.
Good Day
Would really appreciate if you can share the above mentioned case studies.
Many Thanks
Mohammed
Hi Mohammed – please check your inbox for the case studies. I hope they come in useful for you.
Hi..
Could you please share your case studies thru my email –
jmprasanthan@gmail.com
Regards
Manoj
Hi Manoj – please check your inbox for the case studies. I hope they come in useful for you.
Hi..
very interesting had a similar case, Please share your case studies thru my email.
jmprasanthan@gmail.com
Best Regards
Manoj
Hi, kindly let me have the 2 case studies you mentioned above. Recently encountered a contractor who had tendered and accepted a project for a fixed lump sum. However, when the contractor completed the 1st phase of the project, the contractor found out that he had failed to take into account certain requirement of the employer. The contractor is now in quite a mess because those requirements will require him to top up quite a big sum to cover it.
I don’t give legal advice but unless you made it clear that the requirements were not to be met by your tender – that is arguably a counter=offer – you may have to seek the goodwill of the employer.
I would like to request for the 2 case studies mentioned in the article. I am a resident engineer in a road project in Azerbaijan and I have a case where an item of work is mentioned (formation level) as to be paid and referred to the BoQ, which does not have this item. Thank you for a very informative website.
@Ricardo; If the work was expected and was done, or goods supplied as indicated in the Contract, then, of course, the Contractor must be paid. It is value had and received. If it is not listed in a BoQ, then it should be valued according to a comparable price or rate. If there is no comparable in the Contract then it must be valued as a quantum meruit.
Could you please send me the case study. I am working with an Engineer who forgot to include a topping slab for fingers of a pier he was building as it was required to put stamp Crete a finishing product. Finally the client decided to be reasonable and pay for the topping slab out of good will. However they threatened not to pay because it was an error made by the Contractor. There is no written contract in this job.
I would be grateful if you could share the case studies with me.
Hi Martyn – thanks for your comment and interest in the case studies. I’ll send them across to you shortly.
Thanks. I would really appreciate a copy of the 2 case studies as referred.
Good article,Could you please send me the two case studies
Hi – Thanks for your comment, I’ll send the case studies to you via email shortly. Thanks, Nina.
Hi Andy,
Excellent answer. Could you please share the case studies?
Thank you.
Regards,
Joey
Hi Joey – Thanks for your comment and for visiting our blog. I’ll send the case studies to you via email shortly. Thanks, Nina.
very interesting had a similar case, Please share your case studies.
Best Regards
Hi Abdulrahman – I’ll email the case studies to you shortly. Thanks for your comment! Best wishes, Nina.
May I, too, ask for the case studies and FIDIC article? arbitrator@computer.org
Hi Geoffrey – I’ll send the case studies across shortly. I know reference was made to a FIDIC article in another comment but only have the two case studies. Thanks, Nina.
Please send the case study and the fidic article.
Hi Mohamad – We would be happy to share the case studies with you. Please check your email shortly.
very interesting had a similar case, Please share your case studies.
Hi Andy
Interesting debate, I have had a similar situation previously, Item in the BoQ, not shown in drawings and specifications, and the CA deducted the value. The contract has a specific clause in relation to checking and taking ownership of the quants, indeed, he had amended tender quants.
The contractor accepted the argument, although the value was not excessive.
Would be interested in the two case studies please
Dear Andy,
In my first question, I had requested for advice as to whether the Contractor can claim for loss of profit and overheads on omitted works in a lump sum Contract.
The FIDIC general conditions have not been amended in case of evaluation of variations.
Thank you once again.
Kind regards,
Hi Zait,
Your two comments may be answered by considering what should be considered as forming the basis of a lump sum contract. You would need to check the actual contract for this, but usually, the lump sum is defined by what is shown on the drawings and described in the specification.
In your first example, I am not sure what ‘splicing reinforcement’ is, or how or why it should be protected. The question you need to ask yourself is – is this reasonably shown or inferred on the drawings or specification as part of your scope of works? If the answer is ‘yes’ then this should not be a variation.
The second item is slightly more difficult. The drawings show 10 items, so 10 are included in the lump sum price. The real question is, should the omission be evaluated at 10 x the contract rate, or 7 x the contract rate as included in the BoQ? Usually the contract says that variations should be evaluated at the contracts rates and prices so, if I were the contractor, I would argue that the price should be used rather than the rate.
In other words, the total price included in the BoQ for the items should be the maximum deduction.
I hope this helps.
Dear Andy,
Thank you so much for the prompt and detailed response. You have given me a better understanding of point number two and the best argument for my case.
In case of point number one;
The scope of the work for the Contractor is to construct the building up to the podium level, which will be completed later up to the roof level by another contractor.
The (drawings & specifications) and BoQ forms part of the Contract document in that order of priority.
The problem is, the Contract drawings only show the podium plan as there are no elevation drawings that would have enabled the Contractor quantify the additional columns.
However. there is a note on the drawings that states;
– CONTRACTOR TO PROVIDE PROTECTION TO ALL
EXPOSED REINFORCEMENT BARS TO BE SPLICED
WITH REINFORCEMENT OF PHASE 3 VERTICAL
ELEMENTS”
In the shop drawing we received a comment stating;
“…These columns shall be extended beyond Pool Deck Level for Phase(3)..”.”
The Contractor considers this a variation as the columns were not included in the BOQ while Consultant claims that the above note implied the columns should have been quantified.
My apologies for the detailed information.
I look forward to your response.
Thank you
Dear Andy,
I would like to comment on second part of your response. As per my understanding with the Lump sum contract, the Omissions and additional works required to be reflected on Drawings for permanent works, Omission is possible for the quantities which are existing on drawings, it does’t matter what quantity(s) shown in BOQ.
for the items not shown in the drawings, but available in the BOQ and general Specification, I believe Drawings should be read in conjunction with specification. So these items can’t be omitted, as the never existed on Drawings.
Please provide your view on above.
Regards,
Vijay Singh
I’m very grateful for your advice and agree with you.
However, could you kindly assist in the following instances in a lump sum Contract:
1. Splicing Reinforcement is not shown on the drawings nor quantified by Consultants in BoQ, However, there is a note in the drawings stating that protection should be provided for the splicing reinforcement to be extended with the columns floor level to be done by another Contractor. Can the Contractor claim this reinforcement as variation? The Consultant claims that the note is sufficient and Contractor ought to have priced it in his BoQ.
2. If the drawings shows 10 items but the Contractor only priced for 7. In case of an omission, is the Consultant allowed to omit the value of 10 items in the drawings or only the 7 items priced? And does the profits and overheads omitted in case of lump sum contract?
Thank you.
Generally in the lump sum contract you are deemed to include in the contract price for items shown on the drawings. Before submitting the tender either you qualify or price this in the boq as additional item
Andrew and Mr Layman,
Thank you for your comments. This has proved to be a lively blog, which is what we like, because it demonstrates the different points of view that we all have.
I agree with A Layman and would add that building contracts are not like contracts in other walks of life, because each project is bespoke and this results in extremely complicated contract documents.
As A Layman states, the contract usually stipulates that the drawing and specification define the scope of work and in an ideal world, the bills of quantities would be an accurate measurement of this. Unfortunately we don’t always live in an ideal world and we often see items missed from the bills of quantities and sometimes items included that are not shown on the drawings. I have to also ask why, when an item is included in the BoQ but not on the drawings, why would the Contractor price it? Such things happen however and we have to deal with them equitably.
Let me close by asking a question. On a lump sum contract, if something is shown
on the drawings, but not included in the BoQ, could the Contractor claim for additional payment?
Andy Hewitt’s question as to why the Contractor price in the BoQ an item not required by the Specification or Drawings I would offer two answers.
!. the Item might be required as a necessary implication of the design. A necessary detail not shown but to be provided as part of the Contract. No entitlement to extra money.
2. The Item might be an Item included only for pricing a possible addition or a provisional sum. Entitlement to an extra payment if the contract varied.
A lump sum contract normally is a contract to do work described in the Specification and Drawings, If there is a BoQ, the rates in the BoQ are used for variations. Any work not done may we excluded from the price using those rates. In a lump sum contract, the quantities in the BoQ are informative,
Dear Andy
On principal alone, why is the contractor expecting to be paid for something he has not done? This would be unacceptable in any other walk of life, so why is it acceptable in a construction contract? It is beyond belief to me that a contractor who has clearly priced for a specific/defined item, not done (or required to do) the work and still expects to be paid for it! We should always go back to the intent of the contract which I’m sure is to pay for, or be paid, for required work/services properly executed.
Exactly!
And Employer should not be bound to pay for Contractor’s fault to check and adjust BOQ at tendering stage.
Hi Andy,
Please share case studies with me.
In some instances, Contract states that it is a lump sum contract, however, few bills of the BOQ states that these are the provisional quantities and it shall be remeasured as per actual execution at site. In such situation, basic nature of lump sum contract is compromised. Based on the final valuation of these quantities, can contractor demand for adjustment in General and Preliminaries? for under recovery of the same in case of deletion of the items from these bills.
Thank you , very interesting,
I would appreciate if you could share your case studies please.
Very interesting subject and appreciate if you could send me the two case studies on this topic, please.
Regards,
Rolly
Hi Kapila,
You will need to check the actual contract conditions but in most circumstances if an item is not on the drawing or in the specification, it is not included in the lump sum price.
The drawing and specification define the scope and quality of the Works. The bills of quantities are just an estimate to be used for interim valuations and for calculating variations.
Check the Claims Class papers – these may provide you with more insight.
I hope this helps.
Dear Andy,
Let’s say I have two conditioners in the BOQ priced from my side. But it is not in the drawing and specifications. As I understand from this article, I can claim them even if I didn’t install them. But my question is, how will the client approve this item in my interim payment certificate? I’m more than sure the client will say that there is no conditioner provided by me and therefore it will not be approved and paid.
Could you kindly explain how to resolve the matter? If the contractor is given a place in BoQ ( Tender’s adjustment schedule) to do the necessary quantity adjustment (omission and addition) but contractor has not omitted an item which is not on the drawing.
Hi Kapila – I’ve passed your comment onto Andy for his comment. It’s his weekend today so he’ll respond sometime over the next day or two. Thanks, Nina.
Could you kindly share your case study with me.
Regards,
Sanath Neelawela
Hi Andy,
Could you kindly share your case study with me.
Regards,
Edmond
Would be great to have a look at the case studies.
Dear Andy
Could you please forward case studies to my email address
Thanks
Jiju
Dear Andy,
Please can you send me the case studies?
Regards
Firas
kindly share the studies
I fully agree with your stance. Kindly forward the mentioned study-cases.
Regards,
Saad Enan
I again submit that we may see the similiar thread on FIDIC Contract’s Group
Asimilar thread is being discussed in FIDIC Contract’s Group on LinkedIn. Friends may share that to see the insight of the issue/matter.
Thank you for this information.
Kindly share the case studies on omission of items i the BOQ or Lump sum items.
The Contractor is entitled for the omitted works which the contractor prepared for his own conviency, otherwise he has fulfilled the Employer’s Requirements.
Interesting!
Kindly share your case study in this subject matter.
Thank you for sharing these case studies.
Regards
Dear Andy:
You have explained the matter in an excellent manner.
Could you please share these case studies with me.
Thank you.
SAEED
Good Morning Andy,
Same case happened with us also during our projects, most of our contracts with clients were lump sum type and as u said client and engineer always trying to have cakes and eat.
Sometimes we could get our own and was fine.
Thanks for your idea and i would like to have the other two case studies.
Best Regards
Marwan Al Ghouthani
Good afternoon Andy,
I totally agree with your arguments
Appreciate if you could share the two case studies.
Thanks and Regards,
Deep Thampan
Hi Andy,
Good Afternoon,
I am Prince James Kavalam, Claims Manager, FAST Consortium, Riyadh Metro.
I have read your articles.
With ref. to the above subject, I would be grateful if you could send me the case studies that you are referring to.
Many thanks.
Best Regards,
Prince James.
Hi Andy
I am following your replies and advice and actually they are very helpful
Kindly send me a copy of the case studies to expand my knowledge please.
my email: aad.sherif@yahoo.com
Regards
Ahmed Sherif
A very clear, easy to understand answer to this problem – thanks!
I would greatly appreciate if you could provide a copy of the case studies referred to.
Amy
HI Andy,
Please share the case studies….
SAJI
Hi Andy,
Could you please share these case studies with me.
Thank you.
Having the same problem, please forward case studies.
The second scenario may be difficult to implement … The payment will be based on the items in the BOQ… If the work not done, payment to this item will not be certified for this item.
Accordingly, if the item listed on the BOQ dose not exist then will not be certified and consequently deducted.
Please share the case study
Bashar Albany
Please share the case studies
I am interesting to read more about this
Please share the case studies.
Very common scenario.
I would like to receive more of these articles
i) The type of Contract is to be known. Usually in FIDIC EPC and /or P &DB mile stones are provided depending on;
i)Employer’s Requirements
ii) Tests during execution and then the final acceptance Tests
iii)However if some employer’s design is included, the Employer shall provide BOQ for that purpose and measuremnt clause for that purpose is to be included in PCC
Please share the case study
The bills of quantities is only to facilitate the payment to the Contractor and to an extent used to vary the Works before issuance of the taking over certificate (TOC).
FIDIC 1999 Sub-Clause 12.4 deals with Omission.
The Contractor can argue and prove that the Lump sum amount included in the tender did allow for his over head and profit, and also priced this omission item as a risk element to cover the items not shown on the drawings or specs. Hence the Employer cannot omit this item.
Please forward case studies.
Kind Regards
John
Hi Vineethan,
Your point is valid as well! This way any possible dispute at a latter stage can be eliminated. This is a dispute avoidance strategy!
However, we are talking about the dispute resolving mechanism contractually, if the Contractor has not done the suggested prompt action as suggested by you, during the tender stage.
SAJI
For a lump sum contract the client is not entitled to deduct the price of any item not executed by the contractor at the final stage. If the reverse is the case, i.e an item found in the drawing and specification but not found in the BoQ, I doubt if the employer will pay for it, it will be deemed that such item must have been priced or incorporated elsewhere in the BoQ.
Looking at it from another angle, any attempt for client/employer to deduct an unfulfilled BoQ item contradicts the objective of “lump sum”. It will be as if the contractor is being paid for work executed only (re-measurement).
I think what the client would have done prior to final account would have been to issue site instruction for ommission of that item in the form of a variation. In FIDIC, a lump sum can be changed only by variation which can be addition or ommission. My thought.
Hi Andy
It would be more prudent that the Contractor study the tender documents carefully and avoid pricing redundant items mentioned in the BOQ. It would be worth it to mention “Not Applicable” against such items in BOQ that don’t exist in tender drawings or specifications. Thereby eliminating the risk of inheriting a potential contractual dispute during the construction stages.
Appreciate if you could share the case studies to know how such situations unfold to a reasonable conclusion for both parties.
Regards
People still dispute this scenario?
Dear Andy,
I totally agree with your inference on the matter. Definitely, the Employer is not entitled for a cost deduction in this scenario
This is the fundamental aspect of a Lump-sum contract. The Contractor’s obligation is to carry out the scope of works prescribed in the drawings and specifications. The BOQ is a mere schedule prepared based on the drawings and specifications. It may or may not truly represent what exactly is required as per specifications and drawings.
SAJI
No body will prepare the BOQ first
Hi Andy,
Can please forward me the case studies for my understanding and knowledge?
Thanks and Regards
Manavalan
Please share the case studies
Please share your case studies .
Thank you.
Sending now, thanks for your comment. Nina.
Appreciate sharing your mentioned case studies Andy.
We had lots of similar case. It’s always disputable. I’d love the revise scenario, which is a smart way to demonstrate the case.
Thanks Andy.
Visualise, if you will, a BoQ listing priced for items not, in needed in the event.
Doesn’t common-sense say that they can be ignored?
We have inconsistent Engineer’s decisions.
Kindly share the case studies on this topic. It will enable for better comments.
Could you share your case studies concerning the subject.
Thanks and regards,
Michael