FIDIC Yellow Book 1987: A Comprehensive Guide for Electrical and Mechanical Contractors
FIDIC Yellow Book 1987: A Guide for Electrical and Mechanical Works
If you are involved in a project that requires electrical and mechanical works, you may have heard of the FIDIC Yellow Book 1987. But what is it exactly and how can it help you? In this article, we will explain what FIDIC is, what the Yellow Book 1987 covers, and why it is important for electrical and mechanical works. We will also highlight some of the main features, benefits, and challenges of using this contract. Finally, we will answer some frequently asked questions about the Yellow Book 1987.
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Introduction
What is FIDIC and what are its conditions of contract?
FIDIC stands for Fédération Internationale des Ingénieurs-Conseils, which means International Federation of Consulting Engineers in English. It is an international organization that represents the interests of engineering consulting firms worldwide. FIDIC also publishes standard forms of contract for various types of construction projects, such as civil engineering, building, plant, design-build, turnkey, etc.
FIDIC conditions of contract are widely used in international projects because they provide a balanced and fair allocation of risks and responsibilities between the parties. They also reflect best practices and industry standards in engineering and construction. FIDIC contracts are usually divided into three parts: general conditions, particular conditions, and forms of tender and agreement.
What is the Yellow Book 1987 and what does it cover?
The Yellow Book is one of the FIDIC contracts that deals with electrical and mechanical works. The first edition was published in 1963, followed by a second edition in 1976. The third edition, which is also known as the Yellow Book 1987, was published in 1987 and reprinted in 1988. It is still in use today, although newer editions have been released in 1999 and 2017.
The Yellow Book 1987 covers the conditions of contract for electrical and mechanical works, including erection on site. It is suitable for projects that involve the design, supply, installation, testing, and commissioning of electrical and mechanical equipment, such as power plants, substations, transmission lines, pumping stations, water treatment plants, etc. The Yellow Book 1987 assumes that the contractor is responsible for the design of the works, or at least some parts of it. The employer, on the other hand, provides the specifications and requirements for the works.
Why is the Yellow Book 1987 important for electrical and mechanical works?
The Yellow Book 1987 is important for electrical and mechanical works because it addresses some of the specific issues and challenges that arise in this type of projects. For example, it recognizes that electrical and mechanical works are often complex and require specialized skills and knowledge. It also acknowledges that electrical and mechanical works are subject to frequent changes and variations due to technical or operational reasons. Moreover, it takes into account that electrical and mechanical works are often dependent on other works or services provided by the employer or third parties.
Therefore, the Yellow Book 1987 provides a comprehensive and flexible framework for managing the contractual relationship between the employer and the contractor. It defines the roles and obligations of each party, as well as the procedures and mechanisms for dealing with changes, delays, defects, payments, claims, disputes, etc. It also allows the parties to modify or supplement the general conditions by adding particular conditions that suit their specific needs and circumstances.
Main features of the Yellow Book 1987
General conditions
The general conditions are the core of the Yellow Book 1987. They consist of 20 clauses that cover various aspects of the contract, such as definitions, engineer, assignment, documents, obligations, tests, taking over, defects liability, measurement, variations, price, payment, delay, liquidated damages, termination, risk, insurance, force majeure, claims, disputes, and arbitration. Here are some of the key points of each clause:
Clause
Key points
1. Definitions and interpretations
- Defines the terms used in the contract- Provides rules for interpreting the contract- States that written communications are required- Specifies that notices, consents, and approvals must be given by authorized persons- Explains how to calculate cost, overhead charges, and profit
2. Engineer and engineer's representative
- Appoints an engineer to act on behalf of the employer- Allows the engineer to delegate some of his duties to a representative- Requires the engineer to act impartially when exercising his discretion- Gives the engineer the power to make decisions and instructions regarding the contract- Requires confirmation in writing for verbal decisions and instructions- Allows disputing the engineer's decisions and instructions by giving notice within 14 days- Provides for replacement of the engineer by agreement or arbitration
3. Assignment and subcontracting
- Prohibits assignment of the contract without consent- Allows subcontracting up to 30% of the contract price with consent- Makes the contractor responsible for subcontractors' acts and defaults- Requires subcontractors to comply with the contract provisions
4. Contract documents
- Establishes English as the ruling language- Allows day to day communications in other languages- Sets out the priority of contract documents in case of discrepancies- States that documents are mutually explanatory- Defines contractor's drawings as those submitted by the contractor for approval- Requires approval of contractor's drawings before execution of works- Specifies consequences of disapproval of contractor's drawings- States that approved contractor's drawings are binding unless they deviate from contract requirements- Allows inspection of contractor's drawings by employer or engineer- Requires provision of installation information by contractor- Requires provision of operation and maintenance manuals by contractor- Grants employer a license to use contractor's drawings for operation and maintenance purposes- Grants contractor a license to use employer's drawings for execution purposes- Defines manufacturing drawings as those prepared by contractor or subcontractor for manufacturing purposes
5. Errors in contractor's drawings
- Makes contractor liable for errors in his drawings- Makes employer or engineer liable for errors in their drawings if they approve contractor's drawings without pointing out such errors
Clause
Key points
15. Obligations of the employer
- Provides site data and access to site- Obtains permits and licenses- Provides employer's equipment and free issue material- Provides facilities and services- Pays the contract price according to payment certificates- Notifies defects or faults in contractor's design- Limits his right to interfere with contractor's work- Indemnifies contractor against claims by third parties
16. Tests on completion
- Specifies the tests to be carried out by contractor before completion- Requires notice of tests and presence of engineer or his representative- Defines the criteria and procedures for passing or failing the tests- Allows retesting in case of failure or repair- States the consequences of delay or obstruction of tests by employer or contractor
17. Taking over
- Defines taking over as acceptance of works by employer after passing tests on completion- Requires notice of taking over by engineer- Allows taking over by sections or parts- Allows taking over before completion in certain cases- Specifies the effects of taking over on risk, responsibility, and payment
18. Defects liability
- Defines defects liability period as 12 months from taking over or 18 months from commencement date, whichever is earlier- Requires contractor to make good any defects or damage due to design, materials, workmanship, or operation during defects liability period- Requires notice of defects by employer or engineer- Allows employer to execute the work at contractor's cost if contractor fails to do so within a reasonable time- Extends defects liability period for repaired or replaced parts- Requires performance tests after completion of defects liability period if applicable- Issues defects liability certificate after expiration of defects liability period and completion of outstanding work
19. Measurement and evaluation
- Defines measurement as determination of quantities and dimensions of work done- Defines evaluation as calculation of value of work done according to contract price and adjustments- Requires measurement and evaluation to be done by engineer according to contract provisions and methods agreed by parties- Allows provisional measurement and evaluation in case of dispute or difficulty- Requires joint measurement and records by engineer and contractor if possible
</table 14. Variations and adjustments
This clause deals with changes to the scope, quality, quantity, or sequence of the works that may be instructed by the engineer during the execution of the contract. These changes are called variations and may affect the contract price, the completion date, or both. The clause also covers adjustments to the contract price due to changes in legislation, cost indices, taxes, duties, etc.
Some of the key points of this clause are:
The engineer has the authority to order variations within certain limits specified in the contract.
The contractor must comply with the variations unless he gives notice of objection within 7 days.
The contractor must notify the engineer of any additional cost or time implications of the variations as soon as possible.
The engineer must determine the value of variations according to the contract rates and prices, or if not applicable, according to reasonable rates and prices.
The engineer must determine any extension of time due to variations according to the relevant factors affecting the progress of the works.
The engineer must issue interim payment certificates for variations on a monthly basis.
The contractor must keep records of all variations and submit them to the engineer for verification.
The employer may request proposals for variations from the contractor, but he is not obliged to accept them.
The contractor may request variations from the engineer for technical reasons, but he is not entitled to any additional payment or extension of time unless agreed by the employer.
The contract price may be adjusted for changes in legislation, cost indices, taxes, duties, etc., according to formulas specified in the contract.
Particular conditions
The particular conditions are used to modify or supplement the general conditions to suit specific projects. They consist of two parts: Part A - Contract Data and Part B - Special Provisions. Part A contains data and information that are specific to the project, such as names of parties, contract price, performance security, commencement date, completion date, liquidated damages, etc. Part B contains clauses that amend or add to the general conditions, such as scope of works, site conditions, quality control, health and safety, environmental protection, etc.
Some of the key points of the particular conditions are:
The particular conditions must be read in conjunction with the general conditions and prevail over them in case of conflict.
The particular conditions must be prepared carefully and clearly to avoid ambiguity or inconsistency with the general conditions.
The particular conditions must reflect the specific needs and circumstances of the project and the parties.
The particular conditions must not contradict or negate the basic principles and balance of risks and responsibilities of the general conditions.
The particular conditions must be agreed by both parties before signing the contract.
Forms of tender and agreement
The forms of tender and agreement are used to prepare and submit a tender for a contract under the Yellow Book 1987 and to formalize the contract agreement between the parties. They consist of four forms: Form of Tender, Appendix to Tender, Form of Agreement, and Appendix to Agreement. The forms contain data and information that are specific to the tender and the contract, such as names of parties, contract price, performance security, commencement date, completion date, liquidated damages, etc.
Some of the key points of the forms of tender and agreement are:
The forms of tender and agreement must be read in conjunction with the general conditions and the particular conditions and form part of the contract documents.
The forms of tender and agreement must be completed accurately and honestly by the tenderer and the contractor respectively.
The forms of tender and agreement must be signed by authorized representatives of the tenderer and the contractor respectively.
The form of tender must be submitted by the tenderer before the deadline specified in the invitation to tender.
The form of agreement must be signed by both parties after acceptance of the tender by the employer.
Benefits and challenges of using the Yellow Book 1987
What are some advantages of using the Yellow Book 1987 for electrical and mechanical works?
The Yellow Book 1987 has some advantages for electrical and mechanical works, such as:
It is a well-established and widely recognized standard form of contract that has been used successfully for many projects around the world.
It provides a comprehensive and flexible framework for managing the contractual relationship between the employer and the contractor.
It addresses some of the specific issues and challenges that arise in electrical and mechanical works, such as design responsibility, variations, tests on completion, defects liability, etc.
It allows customization and adaptation to suit different projects and parties by using particular conditions.
It promotes cooperation and communication between the parties by involving the engineer as an impartial intermediary.
It provides clear and fair procedures and mechanisms for dealing with changes, delays, defects, payments, claims, disputes, etc.
What are some difficulties or drawbacks of using the Yellow Book 1987 for electrical and mechanical works?
The Yellow Book 1987 also has some difficulties or drawbacks for electrical and mechanical works, such as:
It is an old edition that may not reflect the current practices and standards in engineering and construction.
It may not cover some aspects or risks that are relevant or important for modern projects, such as digital technology, cyber security, sustainability, etc.
It may not suit some types or modes of procurement or delivery that are common or preferred for modern projects, such as public-private partnerships, design-build-operate-maintain, etc.
It may not be compatible or consistent with some laws or regulations that apply to certain jurisdictions or sectors.
It may be subject to different interpretations or applications by different parties or arbitrators.
Conclusion
In conclusion, the Yellow Book 1987 is a standard form of contract for electrical and mechanical works that provides a balanced and fair allocation of risks and responsibilities between the employer and the contractor. It covers various aspects of the contract, such as definitions, engineer, assignment, documents, obligations, tests, taking over, defects liability, measurement, variations, price, payment, delay, liquidated damages, termination, risk, insurance, force majeure, claims, disputes, and arbitration. It allows customization and adaptation to suit specific projects and parties particular conditions. It also promotes cooperation and communication between the parties by involving the engineer as an impartial intermediary. It provides clear and fair procedures and mechanisms for dealing with changes, delays, defects, payments, claims, disputes, etc.
However, the Yellow Book 1987 also has some difficulties or drawbacks for electrical and mechanical works, such as being an old edition that may not reflect the current practices and standards in engineering and construction. It may not cover some aspects or risks that are relevant or important for modern projects, such as digital technology, cyber security, sustainability, etc. It may not suit some types or modes of procurement or delivery that are common or preferred for modern projects, such as public-private partnerships, design-build-operate-maintain, etc. It may not be compatible or consistent with some laws or regulations that apply to certain jurisdictions or sectors. It may be subject to different interpretations or applications by different parties or arbitrators.
Conclusion
In conclusion, the Yellow Book 1987 is a standard form of contract for electrical and mechanical works that provides a balanced and fair allocation of risks and responsibilities between the employer and the contractor. It covers various aspects of the contract, such as definitions, engineer, assignment, documents, obligations, tests, taking over, defects liability, measurement, variations, price, payment, delay, liquidated damages, termination, risk, insurance, force majeure, claims, disputes, and arbitration. It allows customization and adaptation to suit specific projects and parties by using particular conditions. It also promotes cooperation and communication between the parties by involving the engineer as an impartial intermediary. It provides clear and fair procedures and mechanisms for dealing with changes, delays, defects, payments, claims, disputes, etc.
However, the Yellow Book 1987 also has some difficulties or drawbacks for electrical and mechanical works, such as being an old edition that may not reflect the current practices and standards in engineering and construction. It may not cover some aspects or risks that are relevant or important for modern projects, such as digital technology, cyber security, sustainability, etc. It may not suit some types or modes of procurement or delivery that are common or preferred for modern projects, such as public-private partnerships, design-build-operate-maintain, etc. It may not be compatible or consistent with some laws or regulations that apply to certain jurisdictions or sectors. It may be subject to different interpretations or applications by different parties or arbitrators.
Therefore, if you are considering using the Yellow Book 1987 for your electrical and mechanical works project, you should be aware of its advantages and disadvantages and make sure that it meets your needs and expectations. You should also consult a professional engineer or lawye