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George Safonov
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Fidic Letters By Contractor: Examples and Templates for Different Situations



Fidic Letters By Contractor: A Guide for Construction Projects




If you are a contractor involved in a construction project that is governed by the FIDIC (International Federation of Consulting Engineers) conditions of contract, you may have to deal with Fidic Letters on a regular basis. But what are Fidic Letters, and how can you write them effectively? In this article, we will explain what Fidic Letters are, why they are important, how to write them properly, and how to manage and respond to them. We will also provide some examples and templates of Fidic Letters for different situations. By the end of this article, you will have a better understanding of how to use Fidic Letters as a contractor in your construction projects.




Fidic Letters By Contractor.pdf



What are Fidic Letters?




Fidic Letters are formal written communications between the contractor and the engineer (or the employer) in a construction project that is based on the FIDIC conditions of contract. The FIDIC conditions of contract are a set of standard contract documents that are widely used in the international construction industry. They cover various aspects of the project, such as design, execution, supervision, payment, variation, delay, defects, termination, dispute resolution, etc.


Definition and purpose of Fidic Letters




According to the FIDIC conditions of contract, a Fidic Letter is defined as "a written communication which is identified as a 'letter'". The purpose of a Fidic Letter is to convey information, instructions, requests, notices, approvals, consents, determinations, or other communications that are required or permitted by the contract. For example, a Fidic Letter may be used to:



  • Notify the engineer or the employer of the commencement or completion of a part of the works;



  • Request an extension of time or additional payment due to unforeseen circumstances;



  • Inform the engineer or the employer of a variation or change in the scope or quality of the works;



  • Seek clarification or confirmation on any aspect of the contract or the works;



  • Submit a claim or dispute arising from the contract or the works;



  • Respond to any communication received from the engineer or the employer.



Types and formats of Fidic Letters




There are different types of Fidic Letters depending on the nature and content of the communication. Some common types of Fidic Letters are:



  • Letter of Intent: A letter that expresses the intention of one party to enter into a contract with another party;



  • Letter of Award: A letter that confirms the award of a contract to a successful bidder;



  • Letter of Acceptance: A letter that acknowledges the acceptance of a contract by a contractor;



  • Letter of Commencement: A letter that notifies the start date of a contract or a part of the works;



  • Letter of Completion: A letter that certifies the completion of a contract or a part of the works;



  • Letter of Variation: A letter that instructs or requests a variation or change in the contract or the works;



  • Letter of Claim: A letter that submits a claim for additional time or money due to an event or circumstance affecting the contract or the works;



  • Letter of Response: A letter that responds to a communication received from another party;



  • Letter of Dispute: A letter that initiates a dispute resolution process under the contract.



The format of a Fidic Letter may vary depending on the type and purpose of the letter, but generally, it should include the following elements:



  • The date and reference number of the letter;



  • The name and address of the sender and the recipient;



  • The subject and title of the letter;



  • The salutation and opening paragraph;



  • The main body of the letter, which should clearly state the purpose, content, and rationale of the communication;



  • The closing paragraph and signature of the sender.



Benefits and challenges of using Fidic Letters




Using Fidic Letters as a contractor has several benefits, such as:



  • It provides a formal and documented record of the communication between the parties, which can help avoid misunderstandings, ambiguities, and disputes;



  • It ensures compliance with the contractual obligations and requirements, which can protect the rights and interests of the parties;



  • It facilitates effective communication and coordination between the parties, which can improve the performance and quality of the works;



  • It enables timely and accurate reporting and monitoring of the progress and status of the works, which can assist in planning and decision making.



However, using Fidic Letters as a contractor also poses some challenges, such as:



  • It requires a good knowledge and understanding of the FIDIC conditions of contract and their implications for the project;



  • It demands a high level of professionalism and skill in writing clear, concise, and persuasive letters;



  • It involves a lot of time and effort in preparing, sending, receiving, and managing letters;



  • It may create conflicts or disputes with the engineer or the employer if the letters are not written or handled properly.



How to write Fidic Letters effectively?




Writing Fidic Letters effectively is not an easy task. It requires careful planning, preparation, and execution. Here are some general principles and guidelines for writing Fidic Letters effectively:


General principles and guidelines for writing Fidic Letters





  • Know your audience: Before writing a Fidic Letter, you should identify who your audience is, what their expectations are, what their level of knowledge is, and what their tone and style are. You should tailor your letter accordingly to suit your audience's needs and preferences.



  • Know your purpose: Before writing a Fidic Letter, you should also define what your purpose is, what you want to achieve, what you want to communicate, and what you want to persuade. You should structure your letter accordingly to support your purpose.



  • Know your contract: Before writing a Fidic Letter, you should also review your contract carefully, especially the relevant clauses and provisions that relate to your communication. You should refer to them accurately and consistently in your letter.



  • Be clear: When writing a Fidic Letter, you should use simple, direct, and precise language. You should avoid jargon, slang, abbreviations, acronyms, or technical terms that may confuse or mislead your audience. You should also avoid vague, ambiguous, or contradictory statements that may create doubts or disputes.



  • Be concise: When writing a Fidic Letter, you should use short sentences and paragraphs. You should avoid unnecessary words or information that may distract or bore your audience. You should also avoid repetition or redundancy that may weaken your message.



  • Be persuasive: When writing a Fidic Letter, you should use logical arguments and evidence to support your claims or requests. You should also use polite and respectful language to express your opinions or feelings. You should also use positive and constructive words to encourage cooperation or resolution.



Common mistakes and pitfalls to avoid when writing Fidic Letters




When writing Fidic Letters, you should also be aware of some common mistakes and pitfalls that may affect the quality and effectiveness of your letters. Here are some examples:



  • Failing to identify or address the correct recipient: This may cause confusion or delay in receiving or responding to your letter.



Examples and templates of Fidic Letters for different scenarios




To help you write Fidic Letters more easily and effectively, here are some examples and templates of Fidic Letters for different scenarios. You can use them as a reference or modify them to suit your specific situation.


Example 1: Letter of Commencement



Date: 1 June 2023 Ref: ABC/2023/01 To: XYZ Engineering Ltd Address: 123 Main Street, City, Country Subject: Letter of Commencement for Project ABC Dear Sir/Madam, We are pleased to inform you that we have received your Letter of Acceptance dated 15 May 2023 for the contract of Project ABC (the Contract). In accordance with Clause 8.1 of the Contract, we hereby notify you that we will commence the execution of the Works on 15 June 2023 (the Commencement Date). We also request you to issue us the Commencement Certificate as per Clause 8.2 of the Contract within 14 days after the Commencement Date. We look forward to working with you on this project and delivering it successfully. Yours faithfully, ABC Construction Ltd Signature Name Position


Example 2: Letter of Claim



Date: 1 July 2023 Ref: ABC/2023/02 To: XYZ Engineering Ltd Address: 123 Main Street, City, Country Subject: Letter of Claim for Extension of Time and Additional Payment for Project ABC Dear Sir/Madam, We refer to our Letter of Commencement dated 1 June 2023 for the contract of Project ABC (the Contract). We regret to inform you that we have encountered an unforeseeable delay in the execution of the Works due to a severe storm that occurred on 25 June 2023 (the Event). The Event caused significant damage to our equipment and materials, as well as disruption to our labor and transportation. As a result, we have been unable to proceed with the Works as planned. In accordance with Clause 20.1 of the Contract, we hereby give you notice of our intention to claim an extension of time and additional payment due to the Event. We estimate that the Event has caused us a delay of 30 days and an additional cost of $100,000. We will provide you with a detailed breakdown and supporting documents of our claim within 42 days after this notice, as per Clause 20.2 of the Contract. We trust that you will consider our claim fairly and promptly, and grant us the appropriate relief under the Contract. Yours faithfully, ABC Construction Ltd Signature Name Position


Example 3: Letter of Response



Date: 15 July 2023 Ref: XYZ/2023/03 To: ABC Construction Ltd Address: 456 High Street, City, Country Subject: Letter of Response to your Letter of Claim dated 1 July 2023 for Project ABC Dear Sir/Madam, We acknowledge receipt of your Letter of Claim dated 1 July 2023 for the contract of Project ABC (the Contract). We have reviewed your notice and we agree that the storm that occurred on 25 June 2023 (the Event) was an unforeseeable event that affected your execution of the Works. However, we do not agree with your estimation of the delay and cost caused by the Event. We believe that you have not taken into account the mitigation measures that you could have taken to minimize the impact of the Event. Therefore, we request you to revise your claim and provide us with more accurate and realistic figures and evidence. We also remind you that you have an obligation under Clause 8.4 of the Contract to proceed with the Works with due diligence and expedition, regardless of any claim or dispute. We expect to receive your detailed claim within 42 days after your notice, as per Clause 20.2 of the Contract. We will then evaluate your claim and make our determination within a reasonable time, as per Clause 20.3 of the Contract. We hope to resolve this matter amicably and expeditiously. Yours faithfully, XYZ Engineering Ltd Signature Name Position


How to manage and respond to Fidic Letters?




Writing Fidic Letters is only one part of the communication process. You also need to know how to manage and respond to Fidic Letters that you receive from the engineer or the employer. Here are some best practices and tips for handling Fidic Letters:


Roles and responsibilities of the contractor and the engineer in relation to Fidic Letters




The contractor and the engineer have different roles and responsibilities in relation to Fidic Letters, depending on the type and content of the letter. Generally, the contractor is responsible for:



  • Sending Fidic Letters to the engineer or the employer whenever required or permitted by the contract;



  • Receiving Fidic Letters from the engineer or the employer and acknowledging them promptly;



  • Complying with the instructions, requests, notices, approvals, consents, determinations, or other communications contained in the Fidic Letters;



  • Providing any information, documents, or evidence requested or required by the Fidic Letters;



  • Keeping a record of all Fidic Letters sent and received, and maintaining a correspondence register.



The engineer is responsible for:



  • Receiving Fidic Letters from the contractor and acknowledging them promptly;



  • Sending Fidic Letters to the contractor or the employer whenever required or permitted by the contract;



  • Acting as a neutral and impartial intermediary between the contractor and the employer in relation to Fidic Letters;



  • Making fair and reasonable determinations on any matters arising from Fidic Letters;



  • Keeping a record of all Fidic Letters sent and received, and maintaining a correspondence register.



Best practices and tips for handling Fidic Letters




Here are some best practices and tips for handling Fidic Letters:



  • Read and understand the FIDIC conditions of contract carefully, especially the clauses that relate to communication, notices, claims, disputes, etc.;



  • Use a clear and consistent reference system for Fidic Letters, such as date, number, subject, etc.;



  • Use a reliable and secure method of delivery for Fidic Letters, such as email, courier, registered mail, etc.;



  • Keep a copy of all Fidic Letters sent and received, and file them in an organized and accessible manner;



  • Update and review your correspondence register regularly, and track the status and progress of Fidic Letters;



  • Respond to Fidic Letters promptly and professionally, and address the issues raised in them clearly and comprehensively;



  • Seek clarification or confirmation on any Fidic Letters that are unclear, incomplete, or incorrect;



  • Escalate any Fidic Letters that are urgent, important, or contentious to the appropriate level of authority or management;



  • Avoid any Fidic Letters that are unnecessary, irrelevant, or redundant;



  • Avoid any Fidic Letters that are rude, offensive, or provocative;



  • Avoid any Fidic Letters that are false, misleading, or fraudulent.



Conclusion




Fidic Letters are an essential part of communication in construction projects that are based on the FIDIC conditions of contract. They serve various purposes and functions in relation to the contract and the works. As a contractor, you need to know how to write Fidic Letters effectively and how to manage and respond to Fidic Letters properly. By following the general principles and guidelines presented in this article, you can improve your communication skills and performance as a contractor in your construction projects.


FAQs




Here are some frequently asked questions about Fidic Letters:



  • What is the difference between a Fidic Letter and a Notice?



A Notice is a specific type of Fidic Letter that is defined as "a written communication identified as a 'notice'". A Notice is usually used to inform or notify another party of a fact or event that has occurred or may occur under the contract. For example, a Notice may be used to notify the engineer of a force majeure event or a suspension of the works.


  • What is the difference between a Fidic Letter and a Claim?



A Claim is a specific type of Fidic Letter that is defined as "a request or assertion by one Party to the other Party for an entitlement or relief under any Clause of these Conditions or otherwise in connection with, or arising out of, the Contract or the execution of the Works". A Claim is usually used to seek an extension of time or additional payment due to an event or circumstance affecting the contract or the works. For example, a Claim may be used to request an extension of time due to adverse weather conditions or additional payment due to unforeseen ground conditions.


  • What is the difference between a Fidic Letter and a Dispute?



A Dispute is a specific type of Fidic Letter that is defined as "any situation where one Party asserts that it has an entitlement under any Clause of these Conditions or otherwise in connection with, or arising out of, the Contract or the execution of the Works which has not been accepted by another Party". A Dispute is usually used to initiate a dispute resolution process under the contract when a Claim or another matter cannot be resolved amicably between the parties. For example, a Dispute may be used to refer a Claim or another matter to adjudication or arbitration.


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