PROPOSED ERECTION OF A SINGLE-USER INDUSTRIAL DEVELOPMENT WITH 1 BLOCK OF 4-STOREY ADMIN OFFICE AND ANCILLARY FACILITIES ON LOTS 03950PT, 04016PT, &04089PT MK07 AT TUAS SOUTH AVENUE 1 FOR DRIL-QUIP ASIA PACIFIC PTE LTD

CONTRACTOR’S OBLIGATIONS

at

Singapore Dollars

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TYPE OF CONTRACT

This is a Lump Sum Contract and the price is a fixed price not subject to measurement or recalculation should the actual quantities of work and materials differ from any estimates available at the time of contracting, except in regard to variations which may be ordered by the Architect, which shall be valued under the terms of the Contract in accordance with the Schedule of Rates.

The expression “Schedule of Rates” wherever used in this contract shall include any document, however entitled or described, which is signed by the Employer and Contractor as a Contract Document and which is intended to be used for the purpose of valuing variations, or in assisting in the calculation of interim payment in accordance with sub-clause 31(4) or (5) of the Conditions.

Interim payment shall be by fixed instalments of the Contract Sum payable on completion of defined stages of the work in accordance with clause 31(5) of the Conditions and the Appendix to the Contract or other Contract Documents.

Interim payment shall be by periodical valuation of the Work in accordance with clause 31(4) of the Conditions and the Appendix to the Contract.

ARCHITECT

Mr. GORDON S. MAXTED

of the firm of

QUANTITY SURVEYOR

Mr. FRANCIS NG

of the firm of

Delete whichever sub-clause (c) is not applicable. [See also Appendix (and/or Specification) to Contract Conditions, which will need corresponding provisions defining stages and amounts of instalments.]

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PRICES TO BE INCLUSIVE

CONTRACT DOCUMENTS

These Articles of Contract.

The Conditions of Contract and Appendix annexed thereto.

Drawings identified and signed by the parties as the Contract Drawings on which the Contractor has based his prices.

A specification similarly identified and signed as the Contract Specification on which the Contractor had based his prices.

A Schedule of Rates priced and initiated or signed on behalf of the Contractor and the Employer.

Such other letters of documents, including any Invitations to Tender, Tender forms, or letters of acceptance, as the parties may agree and attach hereto as Contract Documents, in which event such documents shall be initiated or signed on behalf of both parties when attached hereto. A list identifying such documents shall also be set out in or attached to the Appendix to the Conditions of Contract.

INTERPRETATION AND GUIDANCE NOTES

ASSIGNS

DEFINITIONS AND INTERPRETATION

“SOP Act” means the Building and Construction Industry Security of Payment Act 2004 or any subsequent amendment thereto.

“SOP Regulations” means the Building and Construction Industry Security of Payment Regulations 2005 or any remaking thereof or any amendment to the regulation therein.

“Payment claim” shall have the same meaning and effect as the words “payment claim” in the SOP Act and SOP Regulations .

“Payment response” shall have the same meaning and effect as the words “payment response” in the SOP Act and SOP Regulations.

“Progress payment” shall have the same meaning and effect as the words “progress payment” in the SOP Act and SOP Regulations.

“Supply contract” shall have the same meaning and effect as the words “supply contract” in the SOP Act and SOP Regulations.

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IN WITNESS WHEREOF

the day and year first above written

(hand of the Employer has been hereunto set

the

*(                                                                                                   )

(Common seal of the Employer has been hereunto affixed)

Signed by the said

*The Common Seal of

Was hereunto affixed in the presence of

Name

KRISTINA CHENG

Address

c/o 9 TUAS AVENUE 12

                S(639031)

Description

            PA to GM

(hand of the Contractor has been hereunto set

and the

*(                                                                                                      )

Signed by the said

Signed by the said

*The Common Seal of

was hereunto affixed in the presence of

Name

CHONG SOON TECK

Address

1 Selegie Road, #06-02

                PoMo, Singapore 188306

                Tel 6273 8888 Fax 6311 0909

Description

GENERAL MANAGER, COMMERCIAL

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ARCHITECT’S DIRECTIONS AND INSTRUCTIONS

The Contractor shall at all times carry out, bring to completion, and maintain the Works in accordance with all the requirements of the Contract and must (subject to sub-clause (8) of this Condition) comply with all written directions and instructions given in relation thereto by the Architect. All orders of the Architect shall be expressed to be either directions or instructions, and shall be given in writing if requested by the Contractor. Any direction or instruction given verbally shall be deemed to have been given in writing, and have retrospective effect from the date of the verbal direction or instruction, provided that the Contractor confirms the direction or instruction in writing within 14 days of its being given, and that the Architect does not within 14 days of receipt of the written confirmation dissent from or withdraw the direction or instruction. If the Architect withdraws any verbal direction or instruction previously given by him within the latter 14 days, then the Contractor shall he compensated for any expense reasonably incurred by him in complying therewith. In addition the Architect may (but shall not be obliged to) at any time subsequently confirm in writing any direction or instruction previously given verbally by him, in which event the confirmation shall have retrospective effect as a written direction or instruction given at the time of the verbal direction or instruction. Verbal directions or instructions of the Architect or Clerk of Works, or written or other orders or requests not expressed to be directions or instructions, need not be complied with by the Contractor if the Architect fails or refuses to confirm the same in writing in properly expressed terms with the minimum of delay when requested to do so, and no claim will be permitted under this Contract based upon an order or request of the Architect unless expressed as a written direction or instruction or confirmed in writing to or by the Architect under the terms of this sub-clause of the Conditions. Directions or instructions given by a Clerk of Works appointed by the Employer shall be of no effect unless confirmed in writing by the Architect at any time, or by the Contractor to the Architect and not dissented from in writing within the same period as Architect’s verbal directions or instructions, in which events such directions or instructions shall be retrospectively validated in the same way as Architect’s instructions. Without such validation the Contractor shall not be entitled to compensation or expense incurred by compliance with any instructions of any Clerk of Works.

In this Contract or when used by the Architect the term “direction” shall mean an order of the Architect (as opposed to suggestions, recommendations or agreements with proposals made by the Contractor) compliance with which will not under the terms of the Contract entitle the Contractor to additional payment or compensation or to an increase in the Contract Sum, but which may in some cases result under the terms of the Contract in a reduction of the Contract Sum, whereas the term “instruction” shall mean an order of the Architect compliance with which, while it may in some cases involve a reduction of the Contract Sum, will in principle entitle the Contractor in an appropriate case under the terms of the Contract to additional payment or compensation or to an increase in the Contract Sum. All orders given or confirmed in writing to the Contractor by the Architect shall be expressed by him to be either “instructions” or “directions”.

The principle matters under the Contract in respect of which the Architect shall have power to give directions as:-

(a)

To secure proper compliance by the Contractor with any existing contract obligations in regards to the permanent work, or to any temporary works or methods of working.

(b)

To secure methods of working and temporary works which will be reasonably safe and proper during construction, or which will ensure properly constructed permanent work, in cases where the Contractor is failing to use the same.

(c)

To vary the permanent works or temporary works or methods of working at the request of the Contractor so as to assist him in overcoming difficulties or in avoiding excessive costs during construction.

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(d)

To vary the permanent or temporary works or methods of working as a consequence of defective work or other default or breach of contract by the Contractor, where insistence upon the removal and rebuilding of the original permanent work would involve unreasonable expense or delay or might prejudice the permanent works.

(e)

To suspend or postpone work and carry out investigations when this is the reasonable consequence of defective work or any other default or breach of contract of the Contractor.

(f)

To alter or vary a previous direction.

The principal matters under the Contract in respect of which the Architect shall have power to give instructions are: -

To vary the permanent work where this is desired by the Architect or Employer or is required under clause 7(1) of the Conditions.

To vary the temporary works or methods of working where this is desired by the Architect or the Employer for any reason or is required under clause 7(1) of the Conditions and the Contractor would otherwise be entitled or obliged to use different methods of working or temporary works.

To postpone or suspend work and carry out investigations where this is not the consequence of any defective work or default or other matter for which the Contractor is responsible under the Contract but is desired for any reason by the Architect or the Employer.

To carry out work or supply goods or materials by Designated or Nominated Sub-Contractors or Suppliers which are the subject of a P.C. Sum or Item in the Specification, Bills of Quantities or other Contract Documents.

To carry out work or supply goods or materials, either by the Contractor himself or by Nominated Sub-Contractors or Suppliers, which are the subject of a Provisional or Contingency Sum or Item in the Specification, Bill of Quantities or other Contract Documents.

To alter or vary any other previous instruction.

The choice by the Architect of the expression “direction” or “instruction” when giving an order to the Contractor shall not bind either the Contractor or the Employer before an arbitrator or the Courts, save only that if after 28 days from receipt of an order expressed as a direction or of its written confirmation by or to the Architect, as the case may be, the Contractor has not disputed its classification as such in writing, or claimed extra payment or compensation for it in writing, or given notice of arbitration in regard to it, then the Contractor shall be conclusively deemed to have undertaken to comply with the direction without an increase in the Contract Sum or any additional payment or compensation. Provided that if the Contractor shall within 14 days of receipt of the direction or its written confirmation request the Architect to inform him in writing under which provision of the Contract the direction is given the Contractor’s time for reserving a claim under this sub-clause shall be extended until 14 days after the Architect has complied with the Contractor’s request.

The Architect shall at no time he under any obligation or duty to the Contractor either on behalf of the Employer or his own account to give a direction as to any matter in sub-clause (3) nor an instruction under paragraphs (a), (b), (c) or (f) of sub-clause (4) hereof, nor shall any failure to do so on his part in any way prejudice the rights of the Employer against the Contractor or render the Employer liable to the Contractor.

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If within 7 days after receipt of a written notice from the Architect requiring the Contractor to comply with a written direction or instruction the Contractor fails to do so, the Employer may employ other contractors to do so under the supervision of the Architect and may upon the certificate of the Architect deduct the extra cost (if any) of doing so from any monies otherwise due under the Contract or recover the same from the Contractor. Such certificate shall be called a “Certificate of Cost of Other Contractor’s Work”, and any such deduction shall be recorded by the Architect in subsequent payment certificates under clause 31 of the Conditions.

If the Architect shall give any direction or instruction, either in writing, or effectively confirmed in writing by or to the Architect under the provisions of this clause, which is subsequently shown to have been given in circumstances where there was either no power to do so under the terms of the Contract, or no justification in fact for the exercise of a power, and if the Contractor has duly complied therewith in accordance with sub-clause (1) of this Condition (and in an appropriate case has protected his position in relation to a direction pursuant to sub-clause (5) of this Condition) then the Contractor shall be entitled to additional payment or compensation (and in an appropriate case to an extension of time) for any damage, liability, expenditure or cost which the Contractor would not have incurred but for the said direction or instruction. Provided that no additional payment or compensation or extension of time shall be made or given under this sub-clause where the direction or instruction is the reasonable consequence, in accordance with the rules of remoteness or mitigation of damage, of any negligence or of defective work, goods or materials or of any other breach of contract by the Contractor.

METHODS OF WORKING AND TEMPORARY WORKS

Unless expressly stipulated or described in the Specification or other Contract Documents, control over the Contractor’s site operations and the choice of methods of working and temporary works shall be the sole right and responsibility of the Contractor.

Provided that in those cases where the choice of and control over the methods of working or temporary works is the Contractor’s, the Architect may, without any obligation to do so and at his entire discretion, give a direction in the circumstances envisaged under clause 1(3) hereof, or an instruction in the circumstances under clause 1(4)(b), requiring the Contractor to change his methods of working or temporary works.

If any accident, loss, liability, claim or damage subsequently occurs as a result solely of the use of the methods of working or temporary works ordered by a direction or instruction of the Architect under sub-clauses 1(3) and (4) of these Conditions and sub-clause (2) hereof (other than orders, whether expressed as directions or instructions, given at the request of the Contractor or as a reasonable consequence of any negligence or default or breach of contract by the Contractor or the result of an insured risk under clauses 19(2)(a) and 20 of these Conditions) the Employer will indemnify and if appropriate pay compensation to the Contractor in respect of the same, provided that the accident, loss, liability, claim or damage would not have occurred if the Contractor’s preferred or previous methods of working or temporary works had been used, and provided further that the Contractor has complied with the Architect’s direction or instruction with due skill and care.

DESIGN AND COMPLETION RESPONSIBILITIES

Except in so far as the Contract either expressly or by implication leaves any question of design, or of choice of materials or workmanship, or of performance of the Works after completion, to the Contractor, or to any Designated or Nominated sob-Contractor or Supplier, the design and/or specification of the Works will be provided on behalf of the Employer by the Architect or by consultants or other persons acting on behalf of the Architect or of the Employer, and the Contractor’s responsibility in relation to the part of the Works so designed and specified shall be limited to bringing the Works to full and satisfactory completion, and to this extent the Contractor shall be deemed to have satisfied himself as to his ability and to have undertaken so to do (subject to any

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obligation to vary the Works under clause 7 of these Conditions). The Contractor shall be under no responsibility for the design or suitability for their purpose or performance of the Works after completion to the extent that any part of the Works has been so designed and specified on behalf of the Employer, provided that he has complied in all respects with the requirements of the Contract, but shall be so responsible in respect of any part of the Works designed, specified or chosen by himself or by any Designated or Nominated Sub-Contractor or Supplier or any other Sub-Contractor or Supplier.

In so far as he may not have already done so at the time of the Contract, the Architect shall supply such further or working drawings, specifications, details, levels, instructions or other information from time to time during the construction period as may be necessary to amplify and explain in detail the work to be carried out by the Contractor. Such information shall be given, in the case of original contract work, within a reasonable time to enable the Contractor to discharge all his obligations under the Contract, regard being had in particular to

(a)

The Contractor’s programme furnished under clause 4 of these Conditions and any qualifications or reservations thereto made by the Architect.

(b)

The actual rate of progress of the Contractor.

(c)

The Contract Date for Completion as currently extended by the Architect.

(d)

Reasonable pre-planning requirements of the Contractor having regard to the nature of the work.

(e)

Advance notice or request for required information from the Contractor where this may be desirable or necessary.

In the case of variations, information in relation to varied work shall be given within a reasonable time of the issue of the relevant variation order to the Contractor.

Subject to clauses 25 and 26 of these Conditions in regard to Phased or Stage Completion and Partial Occupation, the Works shall remain until completion at the risk of the Contractor, who (subject to the receipt of any insurance monies under clause 20 of these Conditions) shall make good at his own expense and without payment any accidental or other loss or damage thereto howsoever caused (including theft or other act of third persons), save only damage (other than damage to the Works due to a risk insured under clause 20 of these Conditions) whose proximate cause is any act or neglect of the Employer or of other contractors engaged by the Employer under clause 17 of these Conditions, or due to an instruction or direction of the Architect under sub-clause 2(3) of these Conditions, for the making good of any of which the Contractor shall be entitled to additional payment or compensation on the like terms as in that sub-clause and, if appropriate, to an extension of time.

Subject to clauses 25 and 26 of these Conditions, for the purpose of this clause “completion” shall mean the completion certified by the Architect in his Completion Certificate under clause 24(5) of these Conditions or, in relation to any outstanding work notified by the Architect under the terms of that clause at the time of the Completion Certificate, the subsequent completion and acceptance of that work.

PROGRAMME

Following acceptance of his tender, and without prejudice to any requirement to do so earlier in his tender or the other Contract Documents, the Contractor shall, not later than 14 days before the stipulated date for the commencement of work, submit for approval by the Architect a programme related to the contract period showing the order or sequence in which he proposes to carry out the various parts of the Works and any proposed temporary works or methods of working which may be relevant to progress. The Contractor will not be permitted to commence work until 14 days after submission of a sufficiently detailed programme, notwithstanding the passing of the

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stipulated Contract Commencement Date, and no extension of time shall be given in respect of any delay so caused.

Approval of the programme by the Architect shall signify his agreement with the proposed order or sequence of working in the programme, and may be taken into account in any dispute for determining a reasonable order or sequence for supplying any outstanding information or details to the Contractor, or for affording possession of the Site by the Employer, but shall not otherwise change the contractual obligations of either party in relation to the Contract Completion Date, or as to a reasonable time for giving or receiving further information, or for affording possession of the Site. In particular an optimistic programme showing completion before the Contract Completion Date shall not without express agreement to that effect with the Employer alter or advance the aforesaid obligations of the Architect and Employer, nor shall it advance the Contract Completion Date.

4.(4)

Disapproval of the programme by the Architect (provided the programme is sufficiently detailed) shall not prevent the Contractor from starting work, but may be taken into account (together with any reasons given by the Architect therefore) in determining any dispute as to a reasonable sequence or order for affording possession of the Site or for supplying further drawings or details or information.

5.

MAKE-UP OF CONTRACTOR’S PRICES

5.(1)

To facilitate the valuation of variations or measurement of the Works the Contractor, without prejudice to any express requirement in the Contract Documents to do so earlier, shall submit to the Quantity Surveyor not less than 14 days before the stipulated date for the commencement of work a breakdown of his prices in the Schedule of Rates. Such breakdown need not state the amount of the Contractor’s profit, but in the case of each rate or price (or representative groups of rates or prices) shall indicate the proportionate amounts (inclusive of profit) expressed as percentages of the total rate or price, attributable to labour, goods or materials, plant, and overheads expenditure (if any) respectively, and shall identify the type of plant, labour, materials or goods or other expenditure allowed for in sufficient overall detail for pricing purposes, drawing attention to any unusual or important items.

5.(2)

In the case of any preliminary items of expenditure in the Schedule of Rates the Contractor shall when tendering indicate by an appropriate key letter those items requiring adjustment based on the quantities of work carried out (Letter Q); those items requiring adjustment based on the time required to carry out the work (Letter T); and those items of expenditure which are of a once-for-all or fixed character and independent of quantities or time (Letter F). In the case of Preliminary or General or Contingency or Lump Sum items, the Contractor shall in addition when tendering indicate precisely all categories of expenditure contemplated by those items which are not included in his other rates and prices. Preliminary items for which the Contractor has given no key letter indication shall be deemed to be fixed.

5.(3)

The Contractor shall not be permitted to commence work until 14 days after the submission of a sufficient breakdown of prices in accordance with sub-clause (1) of this clause, notwithstanding the passing of the stipulated Contract Commencement Date, and no extension of time shall be given in respect of any delay so caused.

6.

ADMINISTRATION

6.(1)

The Contractor shall upon signing this Contract notify the Architect in writing of an address at which Notices and Architect’s certificates, directions or instructions under this Contract may be served upon him. In the event of the Contractor failing to notify the Architect of such an address, all notices under the Contract and Architect’s certificates, directions or instructions shall be deemed served upon the Contractor on the date of recorded delivery if sent by registered post to the address stated in the Articles of Contract, or, if left at his office on the Site, on that date, if a receipt is obtained from the Contractor’s Site Agent or Foreman-in-charge. Notices shall also be deemed served on the date of recorded delivery if sent by registered post or, if not, of actual delivery by hand or otherwise, to the address notified by the Contractor.

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Foreman in Charge

The Contractor shall constantly keep upon the Works a competent Site Agent or Foreman-in-charge and without prejudice to sub-clause (1) hereof, any directions or instructions given to him by the Architect shall also be deemed to have been issued to the Contractor.

Dismissal of

Persons Employed

The Architect may give directions requiring the dismissal from the Works of any person employed thereon whose continued employment by the Contractor may reasonably be regarded as prejudicial to the satisfactory and expeditious completion of the Works.

Copies of

Documents

Immediately upon the execution of this Contract the Architect without charge to the Contractor shall furnish him (unless he shall have been previously furnished) with

One copy certified on behalf of the Employer of the Articles of Contract, of these Conditions, and of the Contract Documents described in Article 6(f).

Two copies of the unpriced Schedule of Rates and (if requested by the Contractor) one copy of the priced Schedule of Rates.

Copies of Drawings,

Etc.

The Architect shall within a reasonable time supply to the Contractor two copies of the working drawings, specifications and information referred to in clause 3(2).

Documents on Site

The Contractor shall keep one copy of the Contract Drawings, one copy of the unpriced Schedule of Rates, one copy of the Specification, and one copy of the working drawings, specifications and information referred to in sub-clause (5) of this Condition upon the Works so as to be available to the Architect or his representative at all reasonable times.

Return of

Documents

Upon final payment under clause 31 of these Conditions, and if no further matters are outstanding between the Contractor and the Employer, the Contractor shall, if so requested by the Architect, forthwith return to the Architect all drawings, details, specifications and other documents of a like nature which bear his name, and the Architect shall return to the Contractor all copies of his make-up of prices under clause 5 of these conditions.

Restrictions on Use

None of the documents hereinbefore mentioned shall be used by the Contractor for any purpose other than this Contract and neither the Employer, the Architect nor the Quantity Surveyor shall divulge or use except for the purposes of this Contract any of the prices in the Schedule of Rates or in the Contractor’s make-up of prices.

Issue of Certificates

All certificates issued by the Architect under this Contract shall, unless otherwise expressly stated in the Contract, be issued to the Contractor, with a copy to the Employer dispatched by hand or ordinary post at the same time and date.

Nothing in this clause shall prejudice the validity of any notice or certificate if proof is furnished of its actual receipt by the party to be served or by his authorised agent.

By-Laws and

Regulations

The Contractor shall comply with and give all notices required by any instrument, rule or order made under any written law applicable or any regulation or bye-law of any Government authority or any statutory undertaker which has any jurisdiction with regard to the Works or with whose systems the same are or will be connected. The Contractor before making any variation from the Works described in the Contract Documents necessitated by such compliance shall give to the Architect a written notice specifying and giving the reasons for such variation and the Architect may issue a direction or instruction in regard thereto. If within seven days of having given the said written notice the Contractor does not receive any diction or instruction in

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regard to the matters therein specified he shall proceed with the work conforming to the written law, instrument, rule, order, regulation or bye-law in question, and any variation thereby necessitated in any part of the Works designed, specified or chosen by or on behalf of the Architect or Employer and not by the Contractor or any sub-contractor shall be deemed to be a variation ordered by a written instruction of the Architect, and if appropriate an extension of time shall be given to the Contractor. Should the Architect himself give a direction or instruction the Employer will, subject to clause 1(5) of the Conditions indemnify the Contractor against any damage, claim, loss or expenditure which would not have been incurred but for the variation, and the Architect shall if necessary grant an extension of time to the Contractor therefore, provided always that the variation relates to any part of the Works designed, specified or chosen by or on behalf of the Architect or Employer and not by the Contractor or any sub-contractor, and that the variation is not required as a consequence of any negligence, breach of contract or other default of the Contractor or of any subcontractor, direct or indirect.

7.(2)

The Contractor may in addition be compensated by the Employer for any fees, charges or other expenditure incurred by him as a result of any statutory obligations which may be identified for the purpose in that Appendix and Specification or other Contract Documents.

8.

The Architect shall determine any levels which may be required for the execution of the Works, and shall furnish to the Contractor by way of accurately dimensioned drawings such information as shall enable the Contractor to set out the Works at ground level. Any errors arising from inaccurate setting out by the Contractor shall either be amended at his own cost or, at the discretion of the Architect, may be accepted without amendment, subject to such reduction in the Contract Sum as may be reasonable having regard to any loss of value suffered by the Employer or any reduced cost to the Contractor resulting from the error, whichever shall be greater.

9.

The Architect and his representatives shall at all reasonable times have access to the Works and to the workshops or other places of the Contractor or of any sub-contractor or supplier where work is being prepared for the Contract. Where such work is to be so prepared in workshops or other places of a sub-contractor or supplier, the Contractor shall by a term in the sub-contract secure a similar right of access to those workshops or places for the Architect and his representatives, and shall take all reasonable steps required of him by the Architect to enforce or assist in enforcing such right.

10.

Subject to compliance with his obligations under clauses 4 and 5 of these Conditions in regard to the provision of a sufficiently detailed programme and breakdown of his prices, and subject to any extension of time properly due under the terms of the Contract, the Contractor shall commence work on the Commencement Date stated in the Appendix to these Conditions, and the Contract Period and Date for Completion therein stated shall respectively commence upon and be calculated from the said date. If no such Commencement Date is stated in the Appendix, or if the date in the Appendix becomes invalidated for any reason which is not the responsibility of the Contractor, then the Commencement Date shall be deemed to be such other date as may be expressly or implicitly agreed by the parties or be a reasonable date for the commencement of work, and the Date for Completion shall be appropriately modified or re-calculated. In such event the Architect may and shall if required by the Contractor issue a Certificate stating the revised Commencement and Completion Dates. Such Certificate is referred to in this Contract as a “Certificate of Revised Commencement Date”.

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Possession of Site

In the absence of express provision to the contrary, the Contractor shall be entitled on the Commencement Date to free and uninterrupted possession of the whole of the area of the Site as defined in the Appendix to the Conditions, whether by reference to the Specification or Drawings or otherwise. The Contractor may also be entitled to such Special Access to the Site as is stated in the Appendix to the Conditions, which the Employer will be responsible for providing. Save as aforesaid the obtaining of access to the Site will be the responsibility of the Contractor. Any arrangements for possession to be given by stages or any other restrictions upon possession of the whole of the Site shall be stated in the Appendix to these Conditions or in the Specification.

Quality of Work and

Materials

Without prejudice to the Contractor’s responsibilities under clause 3 of these Conditions, an materials, goods and workmanship comprised in the Works shall, save where otherwise expressly stated or required, be the best of their described kinds and shall in all cases be in exact conformity with any contractual description or specification and of good quality. Wherever it is practicable to do so the Contractor shall, at the request of the Architect, furnish him with any necessary supporting vouchers, evidence or information confirming that all materials and goods whether fixed or unfixed comply with the requirements of this sub-clause. Any unreasonable failure or refusal by the Contractor to furnish such vouchers, evidence or information shall entitle the Architect to give a direction for the removal of the materials or goods at the expense of the Contractor, and until replacement to deduct their value, if already paid, from the Contract Sum.

Investigation of

Defects

Without prejudice to his powers under the next following sub-clause, the Architect may issue a direction or instruction for the opening up or inspection of any work covered up, or for carrying out tests or investigations of any goods, materials or executed work, arid for the postponement of further work until the results of the tests or investigations are known. If such opening up or inspection or tests or investigations are the reasonable and prudent consequence of defective work by the Contractor or of any breach of contract or negligence or omission on his part or of any sub-contractor or supplier then in such event the Architect may give a direction and the Contractor shall comply with the same at his own expense, nor shall he be entitled to an extension of time, notwithstanding that no further defective work or breaches of contract are subsequently disclosed thereby, but in other cases the Contractor shall be entitled to an instruction and to compensation for any additional Expenditure or delay resulting from compliance with such instructions, and to an appropriate extension of time, unless and to the extent that defective work or other breaches of contract are disclosed thereby, in which event he shall not be entitled to such compensation or extension of time. For the avoidance of doubt, where it seems reasonable to do so in the light of the facts disclosed by any such opening up or inspection or tests or investigations or postponement the Architect may re-classify an earlier direction as an instruction or vice-versa.

Removal of

Defective Work or

Reduction of Price

Without prejudice to his power to vary the work under clause 1(3) of these Conditions, the Architect may give directions for the removal or demolition of any work, goods or materials, whether fixed or unfixed, which are not in accordance with the Contract, and for their reconstruction or replacement in exact accordance with the Contract. Provided that the Architect may, but shall not be bound to, accept any work containing defects unremedied and without removal or replacement, in which event the Contract Sum shall be reduced by any loss of value or otherwise suffered by the Employer, or by any saving in cost obtained by the Contractor in carrying out the defective work, whichever is greater.

Variations Due to

Defective Work

Alternatively, where the requirements of clause 1(3)(d) are satisfied, and without prejudice to his powers under sub-clause (3) hereof, the Architect may, but shall not be obliged to, give directions for a variation of the Works in lieu of their removal or demolition and reconstruction under sub-clause (3) hereof.

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11.(5)

No failure by the Architect to exercise any of the foregoing powers in this clause shall prejudice any subsequent claim by the Employer against the Contractor at any time in respect of work which is not in accordance with the Contract, nor shall the Architect be under any duty to the Contractor to exercise any of the foregoing powers for the benefit of or to assist the Contractor.

12.

In conformity with clauses 1(3) or 1(4) of these Conditions the Architect shall have power at any time to give directions or instructions, as the case may be, requiring a variation to be made in the original Contract work. The Architect shall also have power at any time subsequently to sanction by way of direction a variation previously carried out by the Contractor without any authority, direction or instruction from the Architect. Such subsequent sanction shall not entitle the Contractor to additional payment or compensation or an extension of time, unless such variation was due to negligence or omission or default on the part of the Architect or the Employer or was reasonably carried out in an emergency when it was not practicable to obtain the prior instructions of the Architect, but shall relieve the Contractor from liability to the Employer for departing from the contract requirements without authority, and may involve a reduction in the Contract Sum if any reduced value to the Employer or reduced cost to the Contractor, whichever is greater, is involved in the sanctioned variation.

Subsequent
Sanction

The term “variation” in these Conditions shall mean any change in the original contract descriptions to be deduced from the Contract Documents as a whole describing or defining the Works to be carried out, and in particular shall include: -

The addition of further work, materials or goods.

The omission of work, materials or goods.

The demolition of or removal of work, materials or goods no longer desired by the Employer or the Architect.

The substitution of different work, materials or goods.

Changes in the type, standard or quality of work, materials or goods.

Changes in the plans, elevations, layout, or dimensions of the Works.

Changes ordered in the Contractor’s temporary works or methods of working under clauses 1(3),1(4) and 2(2) of these Conditions.

Changes or additions or omissions ordered in the work, goods or materials of any Designated or Nominated Sub-Contractor or Supplier.

The postponement of any part of the Works, desired by the Employer.

For the avoidance of doubt the term “variation” shall include any changes as aforesaid which may be designed to alter the ultimate use to which the Works will be put.

All variations required by the Architect or subsequently sanctioned by him shall be valued by measurement or calculation by the Quantity Surveyor who, where physical measurement is necessary and subsequent measurement will not be practical due to covering-up or for any other reason, shall give the Contractor an opportunity of being present at the time of such physical measurement and of taking such notes or measurements as the Contractor may require, and who shall following such Measurements make appropriate recommendations to the Architect with a view to subsequent certification by the Architect. Should the Contractor or his representative fail to be present at such time after receipt of reasonable written notice from the Quantity Surveyor, the quantities measured by the Quantity Surveyor, provided they have been communicated in writing to the Contractor by ordinary post within 14 days, shall be final and binding as between the Employer and the Contractor. In cases where the Contractor or his representative has been

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present, any such quantities communicated in writing at any time by the Quantity Surveyor to the Contractor shall be similarly binding unless the Contractor within 1 month of receipt of the same shall send details with sufficient explanations of any differences in the quantities claimed by him to the Quantity Surveyor or to the Architect.

Valuation of

Variations            

Variations shall be valued as closely as possible on the basis of the Contractor’s prices without regard to any alleged element of high or low profitability in those prices and in accordance with the following rules: -

Work ordered in quantities or at times and locations which can be readily absorbed into the Contractor’s programme on the same basis of commercial profitability as the original contract work shall be valued at the same prices as those in the Schedule of Rates, but the prices for any preliminary items of expenditure may also be adjusted where necessary in the light of quantities or time using as guidance where it is reasonable to do so the Contractor’s Make-up of Prices under clause 5 of these Conditions.

Work ordered as aforesaid but for which there is no exactly equivalent item in the Schedule of Rates, shall wherever possible be valued at comparable prices extrapolated from prices for similar though not identical work in Bills, if such exists. and using whatever it is reasonable to do so for such purpose the Contractor’s Make-up of Prices under clause 5 of these Conditions. Preliminary items may also be adjusted in the same manner as in paragraph (a).

Work for which the same or comparable prices as aforesaid are available in or can be extrapolated from the Schedule of Rates, but which by reason of material increases or decreases in quantity, or its sequence of ordering or location, or postponement, or any resultant dislocation or other special physical or technical circumstance, will differ in cost or commercial profitability or working methods from the original work priced by the Contractor, shall whatever possible be valued at the same or comparable prices in accordance with paragraphs (a) and (b) hereof, but with allowances made by way of addition to or deduction from those prices to take account of any such factors and any consequential increase or decrease in cost or commercial profitability to the Contractor. For the avoidance of doubt, such valuation shall not take account of any increase or decrease in the level of building costs unless the variation is carried out at a time different from that reasonably contemplated by the Contractor when pricing his tender or submitting his programme under clause 5 of the Conditions, and the increase or decrease is not otherwise recoverable under any fluctuation clause.

Where the calculation of allowances under paragraph (c) hereof is not practicable the Quantity Surveyor shall make a fair valuation based upon the Contractor’s overall level of contract prices and profitability and without adjustment for any alleged element of high or low profitability in those prices or (save as aforesaid in paragraph (c) hereto) of subsequent changes in building costs.

If, and only if, work cannot be valued on any of the foregoing bases in paragraphs (a) to (d) hereof, the Contractor shall be allowed daywork rates or the prices prevailing when such work is carried out (unless otherwise provided in the Contract Documents):

(i)     At the rates, if any, inserted for this purpose by the Contractor in the Schedule of Rates or in any other Contract Document; or

(ii)    When no such rates have been inserted, at the, actual prime cost to the Contractor of his material, transport and labour for the work concerned, plus 15%, which percentage shall include for the use of all ordinary plant, tools and existing scaffolding, and for preliminaries, supervision, overheads and profit.

Provided that as a condition precedent to payment in either case under this paragraph vouchers specifying the time daily spent upon the work (and, if required by the Architect, the workmen’s names) and any plant, equipment or materials employed shall be delivered for verification to the Architect or his authorised representative not later than the end of the week following that in which the work has been executed.

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For the avoidance of doubt, in the case of omitted work (including work under P.C. or Provisional Sum items, but not contingency items) an allowance for the increased cost or reduced profitability (if any) of the remaining work may similarly be made as in paragraph (c) hereof against the prices for the remaining work, but not for loss of profit on the omitted work itself.

In the case of an obvious accidental error in the rates or prices quoted by the Contractor resulting in a grossly excessive or inadequate rate or price, the Quantity Surveyor may apply a reasonable rate or price in line with the Contractor’s general level of rates or prices, but only to any difference between the original contract quantities and the actual quantities.

The value of all variations ascertained in accordance with the foregoing rules shall be added to or deducted from the Contract Sum and shall be payable to the Contractor on interim certificates in accordance with clause 31 of these Conditions provided: -

That the variation has been ordered in writing by the Architect or confirmed in writing by or to the Architect in accordance with the requirements of clause 1(1) of the Conditions, and that in the case of a written direction the Contractor has protected his position pursuant to clause 1(5) of the Conditions.

That in the case of variations ordered in the circumstances envisaged in clause 1(3) of these Conditions or subsequently sanctioned by the Architect under sub-clause (1) of this Condition, the Contractor shall not be entitled to any additional payment beyond the original Contract Sum or prices for the unvaried work.

That in the case variations ordered in the Contractor’s temporary works or methods of working the Contractor shall not be entitled to any additional payment unless the requirements for additional payment in clauses 1(4)(b) and 2(2) of these Conditions have been satisfied.

That no additional payment beyond the original Contract Sum shall be made for any variation which is the reasonable consequence of defective work or other breach of contract by the Contractor or which is made without the prior authority of the Architect.

That in valuing any variation under paragraphs (b), (c) or (d) hereof, in those cases where the Contractor is not entitled to additional payment beyond the original Contract Sum allowance shall also be made for any loss of value to the Employer of the completed varied work or any reduction or saving in cost obtained by the Contractor in carrying out the varied work resulting from the variations, whichever shall be greater.

For the avoidance of doubt, where additional payment or compensation is due to the Contractor for compliance with an Architect’s Instruction in accordance with clauses 1 (4)(b), 1(4)(c), 1(8), 2(2), 12(4)(c) or any other clause of these Conditions, such payment or compensation shall, subject to clause 12(4)(c) in the case of dayworks payments, be equivalent to the increase (if any) in the cost, or the decrease (if any) in the profitability, of the contract work resulting from compliance with the instruction. Loss of profit on omitted work or on other business or contracts by reason of prolongation of the contract period shall be recoverable only in accordance with the general law where the Employer is in breach of contract, or in cases where under the terms of this Contract the Employer gives an indemnity to the Contractor, and shall not be subject to certification by the Architect.

In conformity with Articles 5 of the Articles of Contract the original Contract Sum, and in respect of varied work the prices in the Schedule of Rates, shall (subject to any express provisions for adjustments of the Contract Sum) be treated as inclusive of all work, materials and expenditure, whether permanent or temporary, which will be either indispensably necessary in any event to complete the works as described in or to be inferred from Drawings, Specifications, Schedule of Rates or other Contract

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Documents taken as a whole, or which may contingently become necessary to overcome difficulties and bring the said works so described a Bill or inferred to satisfactory completion.

Any document entitled a Bill of Quantities is to be used only for the guidance of contractors when tendering, and shall be of no contractual effect, except insofar as such document may, pursuant to Article 2(b) hereof, constitute the Schedule of Rates for valuing variations under clause 12(4) of the Conditions, or for any other purposes of this contract. No warranty is given as to the accuracy of any quantities or descriptions in any such document, nor may any claim be made either in contract or in tort based upon any difference between those quantities or descriptions and the final as-built work, except insofar as they may be due to variations ordered an behalf of the Employer, or constitute a discrepancy or divergence pursuant to clause 14 of the Conditions.

Should any discrepancy or divergence be discovered in or between any of the Contract Documents as to the precise extent or nature of the work to be carried out by the Contractor he shall immediately give notice in writing of the same to the Architect so that a direction or instruction may be given as to the work in fact required by the Architect. In cases where the contract intention is capable of being resolved by interpretation of the documents as a whole, the Architect shall (and, in cases where no notice has been received, may) give a direction if his requirement accords with that intention, and an instruction if it differs from that intention, as the case may he, in which latter event the instruction shall be given under clause 12 of the Conditions and the Contract Sum shall be increased or decreased pursuant to the valuation provisions of that clause. If the discrepancy results in a total ambiguity which cannot be resolved, the Contract shall not be avoided but the Architect shall give an instruction and the Contract Sum shall either be appropriately increased, if the Contractor has as a fact been reasonably misled to his detriment when pricing the Contract, or reduced, if he has as a fact been misled to his advantage, and if necessary an appropriate extension of time shall also be granted to the Contractor.

Assignment by

Contractor

The Contractor’s performance by himself and his servants of a main contractor’s principal functions of controlling the Site with his own site staff, coordinating the work of any sub-contractors, and ordering of materials for the Works, is of the essence of the Contract, and the Contractor shall neither assign nor make arrangements for the vicarious performance of such functions by any other person, now shall any receiver, judicial manager or liquidator of the Contractor be entitled to carry out such functions without the consent of the Employer. In addition the Contractor shall not assign the right to receive monies due under the Contract, or any part thereof, to any person without the prior consent of the Employer, and no such assignment without consent, whether voluntary, involuntary, or statutory, shall bind the Employer.

Except where expressly provided by the Contract the Contractor shall not engage or permit the engagement of any sub-contractor for any part of the Works without the prior written consent of the Architect, which consent shall not be withheld if the proposed sub-contractor is of a class and standing usual and appropriate to the type and extent of the work to be sub-contracted. Any sub-contractor, direct or indirect, properly objected to by the Architect under this clause shall not be permitted to enter the Site, or shall be expelled therefrom forthwith on the direction of the Architect as the case may be.

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Save as expressly provided in this Contract and the Contractor shall make good any damage or loss suffered by the Employer by reason of any breach of contract, repudiation, default or failure, whether total or partial, on the part of any sub-contractor or supplier, whether Designated or Nominated on behalf of the Employer under the provisions of clause 28 of the Conditions or privately engaged by the Contractor, and shall indemnify the Employer against any damage, liability, claim or loss arising therefrom.

PLANT AND MATERIALS

16.(1)

All plant and temporary buildings brought onto the Site by the Contractor shall, until completion of the Works under clause 24(4) of these Conditions, be deemed to be the property of the Employer and shall not be removed therefrom without the prior consent in writing of the Architect, which consent, if no further work appropriate to that plant or those temporary buildings remains to be done, shall not be unreasonably withheld. Upon completion as aforesaid, or removal with consent, the property therein shall be deemed to revest in the Contractor.

16.(2)

Unless directed or instructed by the Architect to be removed under clauses 11(3), 12(2) (c) or 32(4) and (8) of these Conditions, all unfixed materials and goods delivered to the Site shall not be removed until completion without the prior consent in writing of the Architect, which consent, if the materials or goods are surplus to the requirements of the Contract, shall not be unreasonably withheld. The property in such materials or goods shall vest in the Employer upon delivery to the Site and, save as aforesaid, only revest in the Contractor to the extent that surplus materials or goods may be found to exist upon or prior to completion of the Works under clause 24(4) of these Conditions.

16.(3)

Subject to clauses 32(8) and (10) of these Conditions and sub-clause (4) of this Condition, the Contractor shall, upon the issue of the Architect’s Completion Certificate under clause 24(4) of these Conditions, remove all plant, tools, equipment, temporary buildings and surplus material from the Site, save only such as may be necessary to complete any outstanding work or otherwise discharge his obligations under clauses 24(5) and 27 of these Conditions, and in such manner as not to disturb or inconvenience the Employer on re-entry and beneficial occupation of the Works or any part thereof.

16.(4)

In the case of hired or hire-purchase or leased plant or equipment, or plant or equipment owned by any third person or associated or subsidiary company of the Contractor but not by the Contractor himself, no such plant shall be brought on to the Site without the consent of the Architect, who shall have power to withhold consent and if necessary give directions for its removal unless the owner of the plant or equipment gives an undertaking in writing to the Employer that, in consideration of the plant or equipment being permitted to be used on the Site,

(a)

The owner will consent to the assignment by the Contractor to the Employer of the benefit of any hiring or hire-purchase or leasing or other agreement made with the Contractor in respect of the said plant or equipment either

(i)     upon termination by the Employer of the Contractor’s employment before completion or on abandonment of the Works by the Contractor;

         or

(ii)    upon any default in payment made by the Contractor under the terms of the hiring or hire-purchase or leasing or other agreement,

         and

(b)

without prejudice to any such assignment, the plant or equipment may be retained and used by the Employer until the Works have been completed.

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The Contractor, in the circumstances described in sub-clause (4)(a) of this Condition, or his trustee or liquidator or other representative, shall formally assign the benefit of the said agreements if required to do so by or on behalf of the Employer.

ARTISTS, TRADESMEN AND OTHER CONTRACTORS

The Contractor shall permit the Site to be used for the execution of work not forming part of the Contract by artists, tradesmen or other contractors engaged by the Employer. Such artists, tradesmen or other contractors shall be persons for whom the Employer is responsible under the terms of the next following clause of these Conditions.

INDEMNITIES TO EMPLOYER

The Contractor shall be liable for and shall indemnify the Employer against any damage, expense, liability, loss, claim or proceedings whatsoever in respect of personal injury to or the death of any person whomsoever arising out of or in the course of or by reason of the carrying out of the Works, unless the proximate cause of the same is any act or wilful neglect of the Employer or of any person for whom the Employer is responsible (and subject always to sub-clause (3) of this Condition).

Without prejudice to his liabilities in regard to completing the Works under clause 3(3) hereof the Contractor shall be liable for and shall indemnify the Employer against any damage, expense, liability, loss, claim or proceedings due to injury or damage of any kind to any property real or personal, (including any property of the Employer other than the Works) insofar as such injury or damage arises out of or in the course of or by reason of the carrying out of the Works and provided always that the same is due to any negligence, omission, breach of contract or default of the Contractor or of any person for whom the Contractor is responsible including the Contractor’s servants or agents or any sub-contractors, whether direct or indirect, and their servants or agents.

The indemnities given by the Contractor under sub-clauses (1) and (2) hereof shall not be defeated or reduced by reason of any negligence or omission of the Employer or Architect or Clerk of Works in supervising or controlling the Contractor’s site operations or methods of working or temporary works, or in detecting or preventing or remedying defective work, or in ensuring proper performance of any other obligation of the Contractor, but subject always to the Employer’s liability to indemnify the Contractor under sub-clause 2(3) of these Conditions where any loss, claim, or damage arises solely as a result of the Architect’s directions or instructions within the terms of that sub-clause.

INSURANCE AGAINST INJURY TO PERSONS AND PROPERTY AND WORKMEN’S COMPENSATION

Without prejudice to his liability to indemnify the Employer under clause 18 of these Conditions, the Contractor shall maintain or shall cause any sub-contractor, direct or indirect, to maintain

Such insurances (subject to any limitations permitted by the Specification or other Contract Documents) as are necessary to cover the liability of the Contractor or, as the case may be, of any such sub-contractors, in respect of personal injuries or death arising out of or in the course of or by reason of the carrying out of the Works including any liability of the Contractor under the Workmen’s Compensation Act 1975 or any subsequent modification or re-enactment thereof; and

Such insurances as may be specifically required by the Specification or other Contract Documents in respect of injury or damage to property real or personal (other than the Works) arising out of or in the course of or by reason of the carrying out of the Works and caused by any negligence, omission, breach of contract or default of the Contractor, his servants or agents or, as the case may be, of such sub-contractors, direct or indirect, and their servants or agents. Such insurances shall be subject to such limitations as to the extent of liability for any one accident as shall be set out in the Specification and/or in the Appendix hereto.

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(c)

The Contractor shall produce or cause any sub-contractor, direct or indirect, to produce for inspection the relevant policy or policies of insurance together with the receipts in respect of premiums paid under such policy or policies as and when required so to do by the Employer, provided that, as and when may be required by the Employer, the production by either the Contractor or any such sub-contractor of a current certificate of insurance from the company or firm which shall have issued the policy or policies aforesaid shall be a good discharge of the Contractor’s obligations to produce or cause the production of the policy or policies and the receipts in respect of premiums paid, and provided always that any exclusions or limitations of liability or insurance excesses under the policy are stated in the certificate.

(a)

The Contractor shall maintain in the joint names of the Employer and Contractor such insurances as may be specifically stated by way of Provisional Sum items in the Specification or other Contract Documents in respect of any damage, expense, liability, loss, claim or proceedings which the Employer may incur or sustain due to injury or damage of any kind to property real or personal (including property of the Employer but not the Works themselves) arising out of or in the course of or by reason of the carrying out of the Works and caused otherwise than by the negligence, omission, breach of contract or default of the Contractor, his servants or agents, or of any subcontractor, direct or indirect, and his servants or agents. Provided that the Contractor shall be under no liability to the Employer should the provision of such insurance in the event prove impossible or impracticable to obtain following receipt of the relevant Architect’s instructions under the said Provisional Sum items.

(b)

Any such insurance as is referred to in the immediately preceding paragraph of this sub-clause shall be placed with insurers nominated by the Architect and the Contractor shall deposit with the Architect the policy or policies and the receipts in respect of premiums paid.

Should the Contractor or any sub-contractor, direct or indirect, make default in insuring or continuing to insure as provided in sub-clauses (1) and (2) of this Condition, the Employer may himself insure against any risk with respect to which the default shall have occurred and may deduct a sum equivalent to the amount paid by him in respect of premiums from any monies due or to become due to the Contractor (or, where a Provisional Sum item is involved, the Architect or Employer may deduct the amount of the said Provisional Sum from the Contract Sum).

INSURANCE OF WORKS^*

The Contractor shall in the joint names of the Employer and the Contractor insure against loss or damage by fire (however and by whomever caused), and earthquake (or such further risks as are set out in the Appendix hereto), all work executed and all unfixed goods and materials delivered on or adjacent to the Site for incorporation into the Works (but excluding temporary buildings, plant, tools and equipment owned or hired by the Contractor or any sub-contractor, direct or indirect) to the full value thereof (plus the percentage named in the Appendix hereto to cover professional fees) and shall keep such work, materials or goods so insured until completion under clause 24(4) of these Conditions, but subject to any partial termination of insurance permitted under this Contract in cases of Phased or Stage Completion or Partial Occupation by the Employer, Such insurance shall be with insurers approved by the Architect, and the Contractor shall deposit with him the policy or policies and the receipts in respect of premiums paid; and should the Contractor make default in insuring or continuing to insure as aforesaid the Employer may himself insure against any risk in respect of which the default has occurred and deduct a sum equivalent to any amount paid by him in respect of premiums from any monies due or become due to the Contractor. Such policy shall provide expressly for payment in the first place to the Employer of any insurance monies due under the policy.

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Provided always that if the Contractor shall maintain a general policy of insurance with insurers approved by the Architect covering other contracts as well as this Contract against the aforesaid insured risks, and in the like terms as to payment of insurance monies to the Employer, then the maintenance by the Contractor of such policy shall, if the Employer’s interest is endorsed thereon, be a discharge of the Contractor’s obligation to insure in joint names, and production by the Contractor, as and when may be required by the Architect, of the current certificates of insurance from the insurers confirming the existence and continuance of the relevant cover required by this clause shall be a sufficient discharge of the Contractor’s aforesaid obligation to deposit the policy or policies and receipts for premiums paid with the Employer. Such certificates shall state expressly any exclusions or limitations of liability or insurance excesses under the policy.

Upon the occurrence of any loss or damage to the Works or unfixed materials or goods prior to completion from any cause whatsoever the Contractor shall (subject to clause 3(3) of these Conditions) proceed immediately to restore, replace or repair the same free of charge, save only that any monies, if and when received, from the insurance under this clause shall be paid in the first place to the Employer and then (less only the aforesaid percentage for professional fees if any) released to the Contractor by instalments on the interim certificate of the Architect, calculated as from the date of receipt of the monies in proportion to the extent of the work of restoration, replacement or repair previously carried out by the Contractor, but having regard also to any likely shortfall or deficit in the money so paid, whether under clause 40 of the Conditions or otherwise, and to the Contractor’s consequential obligation in such event to reinstate an appropriate proportion of the loss or damage represented by such shortfall or deficit free of charge, whether under clause 40 of the Conditions or otherwise. Provided that if any loss or damage to the Works covered as an insured risk under this clause has itself been caused by the wilful or negligent act of the Employer or of other persons for whom he is responsible without fault on the part of the Contractor, or if the Contractor is entitled to an indemnity from the Employer in respect of the loss or damage under clause 2(3) or any other clause of the Conditions, the Architect shall certify payment in favour of the Contractor on interim certificate in advance of the receipt of any insurance monies, and in addition shall make no deduction in respect of any shortfall or deficit under the policy if such has been previously agreed to or permitted under the Contract.

DUE DILIGENCE BY CONTRACTOR

Following commencement of work under clause 10(1) of these Conditions, the Contractor shall proceed with the Works diligently and with due expedition at all times until completion.

TIME FOR COMPLETION

The Contractor shall complete the Works on or before the Date of Completion stated in the Appendix hereto, or by such Date as modified and re-calculated pursuant to clause 10(1) of these Conditions, or by such Date or modified Date as further extended pursuant to the next following clause of these Conditions, whichever is the latest.

For the purpose of this clause “complete” and “completion” shall mean the completion certified by the Architect under clause 24(4) of these Conditions.

EXTENSION OF TIME

The Contract Period and the Date for Completion may be extended and recalculated, subject to compliance by the Contractor with the requirements of the next following sub-clause, by such further periods and until such further dates as may reasonably reflect any delay in completion which, notwithstanding due diligence and the taking of all reasonable steps by the Contractor to avoid or reduce the same, has been caused by

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Force majeure.

Exceptionally adverse weather conditions.

Fire, storm, lightning, high winds, earthquake or aircraft or aerial objects (provided and to the extent that any of the same are not due to any act, negligence, default, omission or breach of contract by the Contractor or any sub-contractor, direct or indirect, whether in failing to take reasonable steps to protect the Works or otherwise).

War, hostilities, insurgency, terrorism, civil commotion, or riots.

Industrial action by workmen, strikes, lock-outs or embargoes (whether domestic or foreign) affecting any of the trades employed upon the Works or in preparation, manufacture or transportation of goods or materials required for the Works, and provided the same are not due to any unreasonable act or default of the Contractor, or of any sub-contractor, direct or indirect.

Architect’s instructions under clauses 1(4)(a), (b) or (c), 7(1) (Or otherwise in accordance with that clause), 11(2) (where permitted under that clause) and 14 of these Conditions (but not Architect’s direction under clauses 1(3) or 12(5)(b), (c) or (d) of these Conditions).

Architect’s instructions given in relation to P.C. or Provisional Sum items but only if and to the extent that the work which is the subject of such instruction, on a true interpretation of the Contract Documents as a whole, constitutes a variation in kind or extent from the work described under the original P.C. or Provisional Sum items in the Contract Documents.

Architect’s instructions under clause 28 of the Conditions in regard to Contingency Sums.

Failure of the Employer to afford possession to the Contractor in accordance with clause 10(2) hereof.

The Contractor not having received from the Architect within a reasonable time necessary drawing, instructions and other information in regard to the originals contract work pursuant to clause 3(2) of the Conditions, or in the case of varied work within a reasonable time of its being ordered.

Acts or omissions of other contractors engaged by the Employer pursuant to clause 17 of these Conditions.

Shortage of labour resulting from domestic or foreign government actions, embargoes or regulations which an employer of labour could not reasonably have foreseen at the date of the Contract, and notwithstanding the Contractor’s readiness by himself or his sub-contractors direct or indirect to afford satisfactory conditions of working and pay adequate wages or other emoluments therefore.

Shortage of goods or materials which could not reasonably have been foreseen at the date of the Contract resulting from domestic or foreign government actions, embargoes or regulations notwithstanding the Contractors readiness by himself or his subcontractors direct or indirect to pay a reasonable price therefore.

Valid suspension of work under clause 33(4) or 33 (5)of these Conditions.

The grounds for extension mentioned in clauses 1(8), 3(3), 7, 14, 29(3)(a)(ii) and 29(3) (b)(ii) of these Conditions.

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Any act of prevention or breach of contract by the Employer, or any matter in respect of which under the terms of this Contract the Employer gives the Contractor an indemnity.

Any other grounds for extension of time expressly mentioned in the Contract Documents.

It shall be a condition precedent to an extension of time by the Architect under any provision of this Contract including the present clause (unless the Architect has already informed the Contractor of his willingness to grant an extension of time) that the Contractor shall within 28 days notify the Architect in writing of any event or direction or instruction which he considers entitles him to an extension of time, together with a sufficient explanation of the reasons why delay to completion will result. Upon receipt of such notification the Architect, within one month of a request to do so by the Contractor specifically mentioning this sub-clause, shall inform the Contractor whether or not he considers the event or instruction or direction in principle entitles the Contractor to an extension of time.

After any delaying factor in respect of which an extension of time is permitted by the Contract has ceased to operate and it is possible to decide the length of the period of extension beyond the Contract Completion Date (or any previous extension thereof) in respect of such matter, the Architect shall determine such period of extension and shall at any time up to and including the issue of the Final Certificate notify the Contractor in writing of his decision and estimate of the same.

The Architect may in writing request the Contractor for sufficient explanation, information, particulars or materials as will enable him to estimate the period of extension of time to be granted to the Contractor. The Contractor shall within 28 days after receipt of such request furnish to the Architect the information, particulars or materials requested.

The Architect shall not be required under Clause 23(3) to decide and estimate the period of extension of time to be granted to the Contractor unless he is in receipt of the sufficient explanation, information, particulars or materials requested.

After the latest Date for Completion of the Works pursuant to clause 22(1) of the Conditions has passed, then if at the said date there are no other matters entitling the Contractor to an extension of time and the Works nevertheless remain incomplete, the Architect may at any time thereafter up to and including the issue of the Final Certificate give a certificate setting out the Completion Date (if necessary modified or re-calculated under clause 10(1) of these Conditions); the total period of extension of time (if any); the consequential extended Contract Completion Date (if any); and certifying that the Contractor is in default in not having completed the Works by the stated Completion Date or Extended Completion Date (as the case may be). Such certificate shall be issued to the Employer with a copy to the Contractor, and is hereinafter called a “Delay Certificate”.

Upon receipt of a Delay Certificate the Employer shall be entitled to recover from the Contractor liquidated damages calculated at the rate stated in the Appendix to the Conditions from the date of default certified by the Architect for the period during which the Works shall remain incomplete, and may but shall not be bound to deduct such liquidated damages, whether in whole or in part, from any monies due under the Contract at any time.

If while the Contractor is continuing work subsequent to the issue of a Delay Certificate, the Architect gives instructions or matters occur which would entitle the Contractor to an extension of time under clauses 23(1)(f)(g)(h)(i)(j)(k)(n)(o) and (p) of the Conditions, and if such matters would have entitled the Contractor to an extension of time regardless of the Contractor’s own delay and were not caused by any breach of contract by the Contractor, the Architect shall as soon as possible grant

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to the Contractor the appropriate further extension of time in a certificate known as a “Termination of Delay Certificate”.

Such further extension of time granted shall have no immediate effect nor shall it prevent the deduction or recovery of liquidated damages by the Employer until the issuance of the Termination of Delay Certificate. The Termination of Delay Certificate shall be issued to the Employer with a copy to the Contractor and while not preventing the deduction or recovery of liquidated damages accrued up to its issuance shall prevent the accumulation of liquidated damages during the period of the further extension of time granted.

Thereafter, if the Contractor fails to proceed to complete the Works with due diligence within the period of the further extension of time granted under the Termination of Delay Certificate, the Architect shall issue a further Delay Certificate certifying that the Works have remained incomplete and that he is again in default in not so completing. Such certificate shall be known as a “Further Delay Certificate” and shall be issued to the Employer with a copy to the Contractor. Liquidated damages shall re-commence accruing in favour of and be recoverable or deductible by the Employer from the issuance of the Further Delay Certificate.

Subject to the provisions of sub-clause (3) of this Condition as to the effect of Termination of Delay Certificates, the liability of the Contractor to pay further liquidated damages under sub-clause (3) of this Condition shall cease, and the Contract be deemed to be completed for this purpose, upon the issue by the Architect of his certificate under this sub-clause that the Works have been completed. Such certificate is referred to in this Contract as a “Completion Certificate”, and shall be issued by the Architect when the Works appear to be complete and to comply with the Contract in all respects.

Provided that, without prejudice to the Architect’s powers under clause 26(3) of the Conditions, if any minor works are outstanding which can be completed following the removal of the Contractor’s site organisation and all major plant or equipment, and without unreasonable disturbance of the Employer’s full enjoyment and occupation of the property, then upon the Contractor undertaking in writing to complete such outstanding work within such time or times as may be stipulated by the Architect, the Architect may (but shall not be bound to) issue a Completion Certificate, which shall record such outstanding work by way of a schedule attached to the certificate, together with the terms of the agreement with the Contractor for its completion, including any agreement as to withholding and subsequently releasing any part of the Retention Monies otherwise payable on the issue of the certificate in accordance with clause 31 (9) of these Conditions.

PHASED OR STAGE COMPLETION

Where different Commencement and Completion Dates for different phases or stages of the Works are stated and identified in the Appendix hereto and different and separate liquidated damages are provided for each Phase or Stage, the provisions of this Contract in regard to Completion Certificates, liquidated damages for delay, insurance of the Works, maintenance of the Works, and release of Retention Monies (but not final payment on Final Certificate) shall, in the absence of express provision to the contrary in the Contract Documents, apply mutatis mutandis as if each Phase or Stage was the subject of a separate and distinct contract between the Employer and the Contractor.

PARTIAL RE-OCCUPATION

If before completion of the Works in accordance with clause 24(4) the Employer with the agreement of the Contractor takes possession and occupies any part of the same, (in this Contract called “the Occupied Part”) and whether or not all the work within that Part has been entirely completed, the Architect shall issue a Certificate recording the date of re-entry by the Employer and identifying the Occupied Part and, whether by reference or otherwise, any relevant terms of any agreement relating to use, possession and access by the parties, both as to the Occupied Part on the one hand and the remaining parts of the Works on the other. Such certificate is in this Contract called a

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“Certificate of Partial Occupation”, and shall also contain an approximate valuation at Contract prices of the Occupied Part and a forecast of the approximate value of the whole of the Works once complete which shall be made by the Architect, failing agreement with the Contractor, after consulting the Quantity Surveyor. Such valuation shall take account of any outstanding work still remaining to be done in the Occupied Part, and a Schedule attached to or identified by the Certificate shall list the said outstanding work (if any) and record any agreement as to the time or times when it is to be completed.

The following provisions shall apply to the Occupied Part until completion of the remainder of the Works: -

A release to the Contractor of a proportion of the first half of the Retention Monies under clause 31(9) of these Conditions in respect of the Occupied Part, based upon the certified approximate value of the Occupied Part relative to the certified approximate forecast value of the Works as a whole, shall be made within 14 days of the re-entry by the Employer, Such release shall be further proportionately increased when any outstanding work in the Occupied Part is certified by the Architect as completed by the Contractor.

The Maintenance Period of the Occupied Part (save in regard to any outstanding work as aforesaid) shall be deemed to commence upon the said date of re-entry and the provisions of clause 27 of these Conditions in regard to the making good of defects and the issue by the Architect of a Maintenance Certificate shall apply separately and independently to the Occupied Part, and a release of the second half of the Retention Monies calculated on the same basis as the first half (but taking account, if it be the case, of any outstanding work at the time of release of the first half now entirely completed) shall take place separately and independently in relation to the Occupied Part (together with an appropriate reduction made at that stage in the Limit of Retention under clause 31(6) of these Conditions for the remaining Works) at the expiry of the Maintenance Period of the Occupied Part or the issue of its Maintenance Certificate, whichever is the later.

The Contractor may reduce the value of the Works insured under clause 20 of these Conditions by the value of the Occupied Part certified by the Architect as from the certified date of re-entry by the Employer, from which date the Contractor’s obligations under clauses 3(3) and 20(1) of the Conditions shall cease in relation to the Occupied Part (save in regard to any outstanding works in the Occupied Part until such time as their completion by the Contractor has been certified by the Architect).

Any liability of the Contractor for liquidated damages for delay pursuant to clause 24 of these Conditions shall be reduced proportionately based upon the certified value of the Occupied Part relative to the certified forecast value of the whole of the Works as in paragraph (a) of this sub-clause. Such liability shall be further reduced in the same proportions should any outstanding work as aforesaid in the Occupied Part be subsequently certified by the Architect to have been completed by the Contractor.

If before completion of the whole of the Works beneficial occupation and use of a part of the Works by the Employer can be effected without any unreasonable disturbance of the Contractor’s arrangements for completing the remainder of the Works then, upon the issue of a certificate to that effect (hereinafter called a “Certificate of Partial Re-Entry”), and provided that a Delay Certificate issued by the Architect under clause 24 is currently operative, the Employer may without the consent or agreement of the Contractor re-enter and occupy the relevant part of the Works, and the Contractor shall upon the instruction of the Architect remove his plant or equipment from the relevant part and permit the Employer to occupy the same. The Certificate of Partial Re-Entry shall, in the like manner to a Certificate of Partial Occupation, contain instructions regulating the use and possession of and access to the Occupied Part and the remainder of the Works by both parties and recording any outstanding work remaining to be completed in the Occupied Part.

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Upon such re-entry by the Employer the foregoing provisions of this Condition shall apply in the same manner as if the Contractor has consented to occupation of the Occupied Part, save only that the Architect may on subsequent interim payment certify as additional payment or compensation to the Contractor any additional expenditure which, in spite of reasonable care being taken by the Contractor, would not have been incurred by the Contractor but for the re-entry of the Employer. For the avoidance of doubt, the Certificate of Partial Re-Entry shall be final and binding as to the right of the Employer to re-enter the Occupied Part, subject to the right of the Contractor to recover damages or additional payment or compensation under this sub-clause from an arbitrator or the Courts.

MAINTENANCE FOLLOWING COMPLETION

Subject to clause 26 of these Conditions in the case of an Occupied Part of the Works, the Maintenance Period stated in the Appendix hereto shall commence upon the issue of a Completion Certificate under clause 24(4) or 25 of these Conditions. During such period:

(a)

the Contractor shall complete the outstanding work (if any) listed in and in accordance with the terms recorded in the Completion Certificate, and

(b)

the Architect may at any time following the Completion Certificate give directions or instructions for the making good by the Contractor of any defects, omissions or other faults which may be or become apparent in the Works. If the cause of the same is due or found to be due to any breach by the Contractor of any of his obligations expressed or implied under the Contract or those of any sub-contractor or supplier, direct or indirect, and whether Designated, Nominated or privately engaged, then the Contractor shall be responsible for repairing and making good the same or making arrangements therefore at his own expense on the direction of the Architect. If the said defects have occurred despite compliance with the Contract in all respects by the Contractor or any such sub-contractors or suppliers he shall be entitled to payment on a reasonable price basis for compliance with any instruction of the Architect to make good the same.

Not later than 14 days after the expiry of the Maintenance Period, the Architect shall deliver a Schedule of Defects specifying all remaining defects, omissions and other faults apparent at the date of delivery of the Schedule, and on receipt of directions or instructions to do so the Contractor shall forthwith repair and make good the same on the same terms as defects notified to the Contractor under sub-clause (1)(b) of this Condition.

When giving instructions or directions during or at the end of the Maintenance Period under sub-clauses (1) and (2) of this Condition in relation to defects then appearing the Architect shall in addition to the powers in those sub-clauses have the same special powers in relation to such defects as those conferred by clauses 11(2), (3) or (4) of these Conditions, which shall be exercisable by him at any time until the issue of the Maintenance Certificate under sub-clause (5) of this Condition.

Provided that in lieu of requiring the Contractor to make good defects under sub-clause (1) or (2) or exercising the powers in sub-clause (3) hereof, the Architect may, in any case where the cause is a breach of contract by the Contractor or by any sub-contractor or supplier as aforesaid, give a direction that a defect be not remedied, and instead that there should be a reduction in the Contract Sum to be assessed by the Quantity Surveyor representing the reduced value of the work to the Employer, or any savings in cost obtained by the Contractor which the defective work may have involved, whichever is the greater. Such reduction may be effected in the certificate of the Architect releasing the second half of the Retention Monies under clause 31(10) of these Conditions, in a certificate issued under clause 31(6) of these Conditions or alternatively shall be taken into account by the Architect in his Final Certificate.

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When all defects notified by the Architect to the Contractor under sub-clauses (1), (2) or (3) hereof have either been made good by the Contractor in compliance with the Architect’s directions or instructions, or have been dealt with by a direction under sub-clause (4) hereof, the Architect shall issue a certificate to that effect (hereinafter called a “Maintenance Certificate”). Such Certificate shall finally discharge the Contractor from any further physical attendance upon the Works for the purpose of making good defects, but shall not prejudice any other rights of the Employer in regard to defective work, or any other breaches of contract whether previously or subsequently discovered.

DESIGNATED AND NOMINATED SUB-CONTRACTORS AND SUPPLIERS

Work, materials or goods which are to be carried out or supplied by a sub-contractor selected on behalf of the Employer but employed by and under the control of the Contractor shall be identified in the Contract Documents in one of the following ways:-

(a)

Where the identity of the sub-contractor is stated in the Specification or other Contract Documents, such sub-contractors are hereinafter referred to as “Designated Sub-Contractors” (or “Designated Suppliers” as the case may be) and may include persons with whom the Employer or the Architect on his behalf has entered into contractual relations before this Contract on terms that such prior contracts with the Employer will be novated in favour of the Contractor (In this Contract subcontractors designated or selected by the Architect to carry out work or to carry out work and supply materials or goods are referred to as “Designated Sub-Contractors” or “Nominated Sub-Contractors”, as the case may be, and those for the provision or supply of goods or materials only, without any work of fixing, installation, erection or construction, as “Designated Suppliers” or “Nominated Suppliers” as the case may be).

(b)

Where the work, materials or goods have the words “Prime Cost”, “P.C.”, “P.C. Sum” or “P.C. Item” applied to their description in the Specification or other Contract Documents, in such cases the Architect shall select a sub-contractor to carry out the work or supply any goods or materials so described. Such sub-contractors when employed by the Contractor are referred to in this Contract as “Nominated Sub-Contractors” or “Nominated Suppliers” as the case may be. In addition, Designated Sub-Contractors or Suppliers whose work cannot be sufficiently precisely described for pricing purposes at the time of tendering may, pursuant to sub-clause (6) hereof, he the subject of a P.C. Item instead of their work being priced by the Contractor.

(c)

Where the work, materials or goods have the words “Provisional” or “Provisional Sum” or “Provisional Sum Item” (but not “Provisional Quantity”) applied to their description in the Specification or other Contract Documents, in such cases the Architect shall either select sub-contractors to carry out or supply some or all of the work or materials or goods so described (who when employed by the Contractor shall similarly be known as “Nominated Sub-Contractors” or “Nominated Suppliers” as the case may be) or shall instruct the Contractor to carry out or supply some or all of such work or materials or goods himself.

(d)

Where a Contingency amount is stipulated in the Contractor Documents or the words “Contingency”, “Contingent”, “Contingency Item”, “Contingency Sum” are applied to a description of work, materials or goods, in such cases the Architect may, but shall not be bound, to give instructions for the carrying out of work under such items whether in whole or in part either by Nominated Sub-Contractors or Suppliers or by the Contractor himself. If not ordered, any relevant contingency sum or price shall be deducted from the Contract Sum.

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Subject only as hereinafter expressly provided to the contrary in clause 29(3) of these Conditions in cases of reasonable. objection to the nomination of a Designated or Nominated Sub-Contractor or Supplier, the Contractor shall be fully responsible for all Designated or Nominated Sub-Contractors and Suppliers, and for any default or breach of contract on their part, in accordance with the provisions of clause 15(3) of these Conditions, in the same way as for his own work or materials or those of other sub- contractors selected and engaged by himself, and the Employer shall in no circumstances be liable to the Contractor for the default of any Designated or Nominated Sub-Contractors or Suppliers. Without prejudice to the foregoing the Contract shall be deemed to have accepted as his own responsibilities under this Contract all the obligations expressed or implied undertaken by any Designated or Nominated Sub-contractor or Supplier in his sub-contract, including any obligations as to the design, suitability, quality or performance of his work or materials or goods, or in regard to the provision of design services, and whether or not such obligations are expressly mentioned or repeated in this Contract. In particular, in cases where the Employer as a fact relies, and having regard to all the circumstances may be reasonably expected by the Contractor to have relied upon the skill and judgment of a Designated or Nominated Sub-Contractor or Supplier for the design or suitability of his work or materials, the Employer shall for the purposes of this Contract be deemed to have so relied upon the skill and judgment of the Contractor.

Subject to clause 29(3) hereof in cases of reasonable objection to a nomination, the Contractor, in the event of repudiation or abandonment of his sub-contract by any Designated or Nominated Sub-Contractor or Supplier, or its termination by the Contractor, or its disclaimer by the liquidator or trustee in bankruptcy or receiver of any Designated or Nominated Sub-Contractor or Supplier, shall with the consent of the Architect, such consent not to be unreasonably withheld, select another competent sub- contractor or supplier to complete the sub-contract, or himself undertake to do so, in either event being paid therefore the same sum (subject to any defence set-off or counterclaim of the Employer under or by virtue of clauses 3(1) and 15(3) of these Conditions and sub-clause (2) hereof) as would have been payable had the original Designated or Nominated Sub-Contractor or Supplier completed the sub-contract without any default on his part.

Where in the case of Provisional. Sum or Contingency Sum items the Contractor is instructed by the Architect to do some or all the work or supply some or all of the goods or materials himself, the sum due to the Contractor for the said work or materials or goods shall be valued in accordance with the provisions for valuing variations in clause 12 of these Conditions, but whereas both the Contract Period and any preliminary items of expenditure in the Schedule of Rates shall be deemed to be inclusive of such work or materials as are described in or to be inferred from the relevant P.C. or Provisional Sum items (unless materially altered in kind or extent so as to constitute a variation) work ordered under Contingency Sum items, whether by the Contractor himself or by a Nominated Sub-Contractor or Supplier, shall be valued on the basis that neither the Contract Period nor the preliminary items and expenditure in the Schedule of Rates have been calculated or priced in the expectation of this work being ordered.

Subject to any defence set-off or counterclaim of the Employer under or by virtue of this Contract, the sums due to the Contractor in respect of Nominated Sub-contractors and Suppliers shall be determined by deducting the relevant P.C. or Provisional or Contingency Sums from the Contract Sum and by substituting therefore the amount of the relevant Sub-Contractor’s or Supplier’s accounts showing the sub-contract value of the work carried out by them, together with any sums by way of profit or attendance that may have been priced by the Contractor in the Schedule of Rates or elsewhere in the Contract Documents (but not any sums due to the Sub-Contractor by way of damages or compensation in respect of any negligence, default or breach of the sub- contract by the Contractor, unless and to the extent that the same shall for any reason be recoverable by the Contractor from the Employer under or by virtue of any provision of this Contract). In the case of Contingency Sums appropriate adjustments (if applicable) may also be made to any preliminary items in accordance with sub-clause (4) of this Condition.

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The sums due to the Contractor in respect to the work or materials of Designated Sub-Contractors or Suppliers shall either be included in the Contract Sum if the extent of the work or goods or materials is sufficiently precisely known for pricing purposes at the time of tendering, or, if the Specification or other Contract Documents so provide, shall be the subject of a P.C. Item and valued in the same manner as the work or materials or goods of Nominated Sub-Contractors or Suppliers under sub-clause (5) of this Condition. In the case of Designated Sub-Contractors or Suppliers whose work has been priced by the Contractor no instruction from the Architect shall be required under clause 29 of the Conditions, and the Contractor shall be bound to carry out the work or supply the materials by the Designated Sub-Contractor or Supplier.

Payment under sub-clauses (4), (5) and (6) of this Condition shall be made by valuation or otherwise on interim certificate in accordance with the provisions of clauses 30 and 31 of these Conditions.

NOMINATION AND RIGHTS OF OBJECTION

Upon the receipt of an instruction from the Architect under the foregoing clause of these Conditions identifying with sufficient particularity the works or materials to be carried out or supplied and nominating the sub-contractor or supplier selected by him (hereinafter called a “Nomination Instruction”) the Contractor shall forthwith enter into a sub-contract with the selected sub-contractor or supplier in accordance with the terms (if any) stipulated by the Architect in the Nomination instruction (whether by reference to a previous quotation of the Nominated Sub-Contractor or Supplier available for acceptance by the Contractor or otherwise) and if not on appropriate terms negotiated by the Contractor. Upon entering into the said sub-contract with the Contractor the sub-contractor or supplier shall become a Nominated Sub-Contractor or Supplier, as the case may be, for all the purposes of this Contract. In the case of Designated Sub-Contractors or Suppliers whose work is the subject of a P.C. Item under clause 28(6) of these Conditions the Contractor shall similarly place his order in accordance with such terms as may be stipulated or negotiated following an instruction of the Architect, which shall constitute a Nomination Instruction for the purposes of sub-clauses (2) and (3) of this Condition.

Provided that the Contractor shall be entitled to object to a Nomination Instruction either

Because, in the case of Nominated Sub-Contractors or Suppliers, but not Designated Sub-Contractors or Suppliers, there are reasonable grounds for supposing that the financial standing or solvency or technical competence or reliability of the selected sub-contractor or supplier is not such that a prudent contractor, having regard to the nature and extent of the sub-contract work, materials or goods and their possible effect on the remainder of the Works, would be justified at the time of the instruction in engaging the sub-contractor or supplier to carry out or supply such work, materials or goods.

Because, in the case of Nominated Sub-Contractors or Suppliers, or Designated Sub- Contractors or Suppliers whose work is the subject of a P.C. Item, the terms of subcontract offered by the selected sub-contractor or supplier are unsatisfactory in that

(i)     a sub-contractor for work or for work and materials is not prepared to accept equivalent responsibilities or obligations in the sub-contract consistent with those undertaken by the Contractor in this Contract; or

(ii)    a sub-contractor for work or for work and materials is not prepared to indemnify the Contractor against liabilities, claims and damage arising out of negligence, breach of contract or default in the carrying out of the sub-contract work in the same terms as the Contractor is required to indemnify the Employer in this Contract; or

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(iii)     a sub-contractor or supplier is not prepared to offer firm completion or delivery dates consistent with the Contractor’s completion dates or a reasonable programme having regard to those dates; or

(iv)     a sub-contractor or supplier is not prepared to accept liability for general damages for delay which are reasonable having regard to the Contractor’s own liability for delay under this Contract, and to the extent to which the subcontractor’s or supplier’s progress or delivery or completion dates are or may be critical to the Contractor’s progress and productivity; or

(v)      a sub-contractor for work or work and materials or goods is not prepared to accept terms for termination of the sub-contract by the Contractor upon the certificate of the Contractor that the sub-contractor is in default on one of the grounds stated in clauses 32(3)(d), (e) and (g) of these Conditions; or

(vi)     a supplier of goods or materials is not prepared to accept liability for making good or replacing defective work or materials and for reimbursing the Contractor for any expenditure or damage incurred or suffered by him in consequence of such defects; or

(vii)    a sub-contractor or supplier is imposing any other unreasonable exclusion of liability having regard to the Contractor’s obligations under this Contract.

Where the Contractor raises a valid objection to a Nomination Instruction under sub-clause (2)(a) of this Condition based on the standing, solvency, competence or Objection reliability of a selected sub-contractor or supplier the Architect may as an alternative to making a further nomination either

(i)       instruct the Contractor himself to carry out or make arrangements for carrying out the work and/or supplying the goods or materials in question. In such case payment will be on the same basis as if the instruction had been given under a Provisional Sum, or