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NEW QUESTION # 76
Under the FIDIC Red, Yellow, and Silver Books (both editions), the Contractor has a contractual obligation to submit a Value Engineering Proposal. Such proposal shall be prepared at the cost of the Employer. Are both these statements true or false?
Answer: A
Explanation:
Comprehensive and Detailed Explanation:
The Contractor may submit Value Engineering proposals to improve efficiency or reduce costs; however, it is not an absolute contractual obligation to submit such proposals. Also, the preparation of these proposals is generally at the Contractor's own cost initially. If the proposal is accepted and results in a Variation, then adjustments to the Contract Price may occur, potentially reimbursing the Contractor.
Thus, both statements are false.
References:
FIDIC Red, Yellow, Silver Books 1999 & 2017 Editions, Sub-Clause 13.1 - Value Engineering FIDIC Contract Manager Study Guide, Module on Variations and Value Engineering
NEW QUESTION # 77
Under the FIDIC Red Book (edition 1999), if the Contractor as per Sub-Clause 14.2 has to ensure the Employer receives an Advance Payment Guarantee as per the standard model, what type of instrument should this be?
Answer: C
Explanation:
According to FIDIC Red Book 1999, Sub-Clause 14.2, the Advance Payment Guarantee must be a bank guarantee issued by a reputable bank acceptable to the Employer. This bank guarantee serves as security to ensure that the advance payment made by the Employer will be repaid if the Contractor fails to fulfill contractual obligations. The bank guarantee is a commonly used, reliable instrument providing direct financial assurance to the Employer.
Other instruments like surety bonds or parent company guarantees may be acceptable only if explicitly agreed, but the standard requirement is a bank guarantee.
Declaration of joint and several liability is not a typical form of guarantee for advance payments.
References:
FIDIC Red Book 1999 Edition, Sub-Clause 14.2 - Advance Payment Guarantee FIDIC Contract Manager Study Guide, Module on Payment Procedures and Guarantees
NEW QUESTION # 78
Which FIDIC Book (edition 2017) should be considered first by an Employer that is an experienced employer who knows exactly what they want from a design & engineering perspective?
Answer: A
Explanation:
The FIDIC Red Book (2017 edition) is traditionally used for construction contracts where the Employer provides the design, and the Contractor primarily executes the construction works. This form is suitable for Employers who have detailed and well-defined design and engineering requirements and want to retain control over the design.
* TheRed Bookis ideal for experienced Employers who have a clear and fixed design and require the Contractor to build accordingly.
* TheYellow Bookis typically used where the Contractor is responsible for both design and construction (design & build). It suits Employers who want to delegate design responsibility to the Contractor.
* TheSilver Bookis used for turnkey or EPC contracts where the Contractor takes full responsibility for design, procurement, construction, and commissioning, suitable for Employers seeking minimal involvement in design and execution details.
* Hence, for an Employer whoknows exactly what they wantfrom a design and engineering perspective and wants to maintain control, theRed Bookis the first and most appropriate choice.
References:
FIDIC Red Book 2017 Edition - Conditions of Contract for Construction
FIDIC Yellow Book 2017 Edition - Conditions of Contract for Plant and Design-Build FIDIC Silver Book 2017 Edition - Conditions of Contract for EPC/Turnkey Projects FIDIC Contract Manager Study Guide, Module on Contract Selection
NEW QUESTION # 79
Which one of the following statements is NOT correct in respect of FIDIC Yellow Book (both editions)?
Answer: D
Explanation:
Option C is NOT correct. FIDIC Yellow Book General Conditions aim to allocate risks fairly and equitably between the Employer and Contractor. The contract balances risks according to who is best able to manage them. It does not impose a disproportionate risk burden on the Contractor.
Options A, B, and D are correct statements describing typical contract formation, risk allocation, and Contractor's design and execution responsibilities.
References:
FIDIC Yellow Book 1999 and 2017 Editions - Introduction and Risk Allocation Clauses FIDIC Contract Manager Study Guide, Module on Introduction to FIDIC Contracts
NEW QUESTION # 80
Applying FIDIC Silver Book (edition 1999), which one of the following elements shallnotform part of the time Programme/revised programme?
Answer: D
Explanation:
Comprehensive and Detailed Explanation:
According to the FIDIC Silver Book, 1999 Edition (The Conditions of Contract for EPC/Turnkey Projects), the Contractor is required under Sub-Clause 8.3 ("Programme") to submit a time programme that illustrates the sequence and timing of the works, including milestones and key events. The intended order of the works (Option A), sequence and timing of inspections and tests (Option B), and review periods (Option D) related to contract management processes such as approval of design or submissions (Sub-Clause 5.2) are integral to effective scheduling and coordination.
However,remedial work instructed under Sub-Clause 7.6, which concerns remedying defects or damage, is generally not part of the initial or revised programme. Instead, remedial works are typically handled as separate tasks or incorporated into specific defect liability or rectification schedules after the main programme has been executed. Such remedial works arise from defects liability obligations and do not belong to the original or revised time programme used to plan the main construction phases.
This distinction is important because the programme reflects planned works execution, whereas remedial work is reactive and may be scheduled separately under defects liability clauses or final project close-out arrangements.
References:
FIDIC Silver Book 1999 Edition, Clause 8.3 - Programme
FIDIC Silver Book 1999 Edition, Clause 7.6 - Remedial Work
FIDIC Contract Manager Study Guide, Module on Time and Delay Management
NEW QUESTION # 81
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