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Balance

The document outlines the procedures for issuing the Final Payment Certificate (FPC) and the conditions under which the Employer's liability ceases. It specifies the timing for FPC issuance, the required content, and the implications of failing to submit a Final Statement. Additionally, it addresses the handling of multiple currencies in payment and exceptions to the cessation of liability for the Employer.

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18 views3 pages

Balance

The document outlines the procedures for issuing the Final Payment Certificate (FPC) and the conditions under which the Employer's liability ceases. It specifies the timing for FPC issuance, the required content, and the implications of failing to submit a Final Statement. Additionally, it addresses the handling of multiple currencies in payment and exceptions to the cessation of liability for the Employer.

Uploaded by

Donz
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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• Title: The End Game: Issuing the FPC (14.

13)

• Content: The Engineer's final determination of the net balance due between
parties. Issued after Final/Partially Agreed Statement and Discharge are received.

Slide 89: Sub-Clause 14.13 - Timing of FPC Issuance

• Title: When is the FPC Issued?

• Content: Within 28 days after receiving BOTH:

o Final Statement OR Partially Agreed Final Statement (as applicable).

o The Discharge under 14.12.

Slide 90: Sub-Clause 14.13 - Content of the FPC (Contract Text)

• Title: What the FPC Must State

• Content: Engineer issues to Employer (copy Contractor) stating [cite: 2, 304-305]:

o (a) Amount Engineer fairly considers finally due (incl. all


additions/deductions under 3.7, Contract, etc.) [cite: 2, 304(a)].

o (b) The balance due (from Employer to Contractor OR Contractor to


Employer) after crediting all previous Employer payments & Employer
entitlements, AND crediting Contractor payments/Performance Security
recoveries [cite: 2, 305(b)].

Slide 91: Sub-Clause 14.13 - Failure to Submit Final Statement

• Title: Scenario: Contractor Fails to Submit Draft Final Statement

• Content: If Contractor fails to submit draft within 14.11.1 timeframe:

o Engineer requests Contractor to do so.

o If Contractor still fails within 28 days of request, Engineer issues FPC for
amount Engineer fairly considers due.

Slide 92: Sub-Clause 14.13 - Exception: IPC Instead of FPC

• Title: Important Distinction: When an IPC is Issued Instead

• Content: If Contractor submitted a Partially Agreed Final Statement [cite: 2, 308(i)]


OR a draft is deemed by Engineer to be one [cite: 2, 309(ii)], THEN:
o Engineer proceeds under 14.6 [Issue of IPC] to issue an IPC, not an FPC
under 14.13. This covers only the agreed amounts.

Part 7: Contract Closure & Liability

Slide 93: Module 14 - Sub-Clause 14.14: Cessation of Employer’s Liability


(Introduction)

• Title: Finality of Payment: Cessation of Employer's Liability (14.14)

• Content: Defines when Employer is no longer liable for Contractor claims,


reinforcing contract closure, except for specific carve-outs [cite: 1, 2, 310-314, 493].

Slide 94: Sub-Clause 14.14 - Conditions for Liability to Cease (Claim Inclusion)

• Title: When Does Employer Liability End? Rule 1: Inclusion

• Content: Employer not liable for any matter/thing under Contract unless Contractor
included an amount expressly for it in:

o (a) The Final Statement or Partially Agreed Final Statement [cite: 2, 310(a)].

o (b) AND (except for post-TOC matters) the Statement at Completion (14.10)
[cite: 2, 311(b)].

Slide 95: Sub-Clause 14.14 - Conditions for Liability to Cease (Post-FPC Claim)

• Title: When Does Employer Liability End? Rule 2: Post-FPC Action

• Content: Unless Contractor makes a Claim under 20.2 regarding FPC amounts
within 56 days of receiving FPC copy, Contractor deemed to have accepted FPC
amounts. Employer then has no further liability, other than paying FPC balance &
returning Performance Security.

Slide 96: Sub-Clause 14.14 - Exceptions to Cessation

• Title: What Liability Survives Cessation?

• Content: This sub-clause does NOT limit Employer's liability for:

o Employer's indemnification obligations.

o Fraud by Employer.
o Gross negligence by Employer.

o Deliberate default by Employer.

o Reckless misconduct by Employer.

• These remain actionable.

Slide 97: Sub-Clause 14.14 - Key Takeaways

• Title: Module 14 Recap: Cessation of Liability

• Content:

o Promotes finality.

o Claims must be included in SAC (if pre-TOC) and Final/Partially Agreed


Statement [cite: 2, 310-311].

o Contractor must dispute FPC via Claim within 56 days or accepts it.

o Specific Employer liabilities (indemnity, fraud etc.) are not time-barred by


14.14.

Part 8: Administrative Aspects - Currencies

Slide 98: Module 15 - Sub-Clause 14.15: Currencies of Payment (Introduction)

• Title: Managing Multiple Currencies: Currencies of Payment (14.15)

• Content: Governs payment currencies, proportions, and exchange rates, crucial for
international projects. Ensures transparency and manages FX risk.

Slide 99: Sub-Clause 14.15 - Base Rule (Contract Data)

• Title: The Governing Rule: Contract Data

• Content: Contract Price paid in currency(ies) named in Contract Data. If multiple


currencies named, payment follows rules below.

Slide 100: Sub-Clause 14.15(a) - Payment Allocation Rules

• Title: Currency Allocation: Proportions & Rates (14.15(a))

• Content: If ACA expressed in single currency but multi-currency payment specified:

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