ESPECIFICACIONES TÉCNICAS

This clause states that the Contractor will be taken to have satisfied himself that his tender and the rates and prices stated in the Bill of Quantities are correct and sufficient and that they cover everything that the Contractor has to do to complete the contract.

If the Contractor encounters physical obstructions or conditions (other than bad weather) which an experienced Contractor could not have foreseen, he may give notice to the Engineer. If after consultation with the Employer and the Contractor, the Engineer agrees, he grants an extension of time and costs including in respect of any instruction or other action taken by the Contractor to overcome the obstacle.

In the 4th Edition, clause 12 is divided into two sub-clauses. Sub-clause 12.1 is very similar to the first sentence of the 3rd Edition but the words in parentheses are additional. Sub-clause 12.2 retains the same basic structure as the second part of clause 12 of the 3rd Edition but refers to "physical obstructions or physical conditions" instead of "physical conditions ... or artificial obstructions".

12.1 This sub-clause, which logic and, indeed, the ICE would place in the previous clause, has to be read in conjunction with clauses 55 to 57 (Measurement). This clause does not deem the Contractor to have satisfied himself as to the quantities in the Bill which clause 55.1 (Quantities) states are estimated and "not to be taken as the actual and correct quantities". This clause provides a defence to the Employer against a claim by the Contractor for variations and extra payment on the grounds that items of work were not covered within the Bills of Quantities. The Employer will say that the Contractor has to satisfy himself that the tender covers all his obligations under the contract and that if the work the subject of the claim was reasonably to be inferred from the drawings, specification etc the Contractor is entitled to no further payments. For more on this area, see the commentary to clauses 55 to 57.

It may be relevant to note that the Tender is defined at clause 1.1(b)(v) as the Contractor's offer "as accepted by the Letter of Acceptance". Thus the Tender will often be the result of a course of negotiation and changed from the document originally submitted.

Under clause 5.2 (Priority of contract documents), it is stated that whilst the contract documents, of which the Tender is one, are to be taken as mutually explanatory, "in case of ambiguities or discrepancies the same shall be explained or adjusted by the Engineer". Thus it may be possible for an error in the tender which amounts to a discrepancy or causes an ambiguity, to be rectified. It is not

necessary for the ambiguity or discrepancy to be between the various contract documents but may be limited to the Tender. Errors in carrying forward the rates and prices in order to achieve the Contract Price should be irrelevant to the Contractor's recovery which will be based on the remeasured quantities and the rates only. Thus, the unscrupulous Contractor may try to increase his prospects of succeeding in the competitive tender by introducing such errors in order to reduce his tender price. Thus, the first task of the Employer's Quantity Surveyors will be to check the mathematics of the Bill of Quantities.

"...except insofar as it is otherwise provided in the Contract...". Taken in isolation, clause 11.1 (Inspection of Site) and this clause seem to suggest that the Contractor must allow for whatever steps are necessary in order to complete the project. This position would be in accordance with English common law which, subject to numerous qualifications, imposes the same obligation. This contract has a number of provisions which produce a fairer result with the benefit to the Employer that the Contractor will not have to include large contingency sums in his tender to cover a wide range of largely unpredictable risks:-

-clause 12.2 (Adverse physical obstructions or conditions) releases the Contractor from responsibility for physical obstructions or conditions not reasonably foreseen;

-clause 13.1 (Work to be in accordance with contract) releases the Contractor in the event of legal or physical impossibility;

-clause 20.4 passes responsibility to the Employer for a list of "Employer's Risks" including design and "any operation of the forces of nature";

-clauses 55 to 57 (Measurement), which make this form of contract a remeasurement contract, give the Contractor a right to be paid for additional quantities of work executed by reason, for example, of an unexpectedly high degree of unsuitable material found in excavations unless the contract expressly places responsibility on the Contractor's shoulders;

-clause 65 (Special risks) further protects the Contractor from liability in the event of war and certain of the Employer's risks under clause 20.4;

-clause 66 (Release from performance) releases the Contractor from performance in the event that any circumstance outside the control of both parties renders performance impossible or unlawful; and

-clause 70 (Changes in cost and legislation) reimburses the Contractor for additional costs arising from price fluctuations or changes in the law.

The foregoing clauses represent a distribution of risk within the contract in line with the philosophy that it is better for the Employer to take on those risks which cannot readily be ascertained or priced. To do otherwise means that the lowest tenderer is likely to be the Contractor who has most severely under-estimated the

possible problems with the project or who has taken the greatest risks. The Employer will not be well served if his Contractor is forced out of business should the risk eventuate. Nevertheless, an Employer on a large project which would attract major international contractors and large performance bonds could well decide that risks should be re-aligned in the Employer's favour.

In addition to the clauses listed above, the Engineer is empowered to order the Contractor to "execute additional work of any kind necessary for the completion of the Works" under clause 51.1 (Variations) item (e).

12.2 This edition departs from the 3rd Edition and ICE 5th by dispensing with the word "artificial" to describe the obstructions which now need only to be "physical". This plainly widens the scope beyond man-made obstructions to anything material. The question of what is reasonably forseeable by an experienced Contractor is a difficult question of fact which has and will continue to occupy the attention of arbitrators worldwide.

Contractors bidding for a contract containing this clause have to decide which of the most common risks to price for: the fewer allowed for, the lower their price and the better their chance of winning the contract. Rock is a common example: an everyday risk in civil engineering but slow and expensive to remove. If the contract is silent, is the Contractor entitled to assume that no rock will be encountered? Clause 11.1 (Inspection of site) would require the Contractor to include in his tender for anything that practicable investigations should have disclosed. Disputes are perhaps inevitable when the contractor to win the job may be the contractor who has made the least allowance and thus is the most dependant on a claim under this clause.

Notice must be given in writing in accordance with clause 1.5 (Notices, consents etc) and must be correctly addressed in accordance with clause 68 (Notices). Such notice must be given "forthwith", that is immediately. The only other circumstances requiring such an instant reaction are clause 27 (Fossils) and clause 65.5 (Increased costs arising from Special Risks). However a failure to give such notice is not expressed to be a condition precedent to the Contractor's recovery and the notice requirement may be contrasted with clause 52.2 (Power of Engineer to fix rates) and with clause 44.2 (Contractor to provide notification and detailed particulars).

The lack of procedure following the discovery of a physical obstruction or condition may give rise to difficulties. The question as to who is to decide what steps should be taken to overcome the obstruction or condition is not answered. The Contractor may ask for instructions of the designer of the project who will doubtless reply that it is not for him to dictate to the Contractor his method of working. In view of the likely critical nature of the problem, this impasse should perhaps have been avoided by the draftsman, despite the wide variety of possible circumstances giving rise to a claim under this clause. It is argued in the commentary under clause 51.1 (Variations) that, although the Engineer is given a

broad discretion, when excercising that discretion as to whether or not to instruct, he is subject to clause 2.6 (Engineer to act impartially), particularly when the instruction would amount to a variation.

"...during the execution of the Works...": A Contractor who has received his Letter of Acceptance but has not yet received his notice to commence under clause 41.1 (Commencement of works) would be well advised to avoid carrying out any digging of trial pits or drilling of boreholes. If the unforeseen physical condition or obstruction is discovered prior to the commencement of the execution of the Works, the Employer may well be entitled to argue that clause 12.2 does not apply. The Contractor would have to fall back upon clause 44.1 (Extension of time for completion) and claim that the problem amounted to "special circumstances". Whilst the Contractor would probably have the sympathy of the arbitrator, his argument may well not succeed.

"...other than climatic conditions on the Site". For the other references to the weather, see clause 11.1 (Inspection of Site), clause 40.1 (Suspension of work) and clause 44.1 (Extension of time for completion); and see clause 20.4 (Employer's risks) for the phrase "any operation of the forces of nature". Clauses 20.4 and 44.1 are not limited to climatic conditions "on Site".

This is another example of a clause where the marginal note, "Adverse physical obstructions..." is not reflected in the clause. The word "adverse" does not feature in the clause and the obligation to give notice is not confined to adverse conditions: the discovery of soil where rock was expected would technically require notification. The Engineer may be reluctant to grant time or costs for such good fortune but if the Contractor had to bring to site different equipment to replace the rock-blasting arrangements he had prepared, there may nevertheless be a claim. Clause 1.2 (Headings and marginal notes) makes it clear that marginal notes are not to be considered when construing the contract.

In civil law countries, with systems based on the French model, administrative contracts including public works contracts would incorporate the Theorie des sujetions imprevues.By this doctrine, a Contractor encountering an exceptional and unforeseen physical obstruction which had not been caused by the relevant Administration, might be entitled to compensation under administrative law. In such a contract, therefore, clause 12.2 may not be strictly necessary. A question- mark remains, however, as to whether compensation will be reduced or refused if clause 11.1 (Inspection of site) is interpreted to mean that the Contractor has agreed to take on the risk of ground conditions. For an outline of the major administrative law provisions, see under clause 5.1 (Languages and law).

CLAUSE 12.2 (Not foreseeable physical obstructions or conditions)

In the title of this sub-clause, the word "adverse" has been replaced with "not foreseeable". It was a peculiarity of both the 3rd and 4th Editions that the word "adverse" appeared in the title but not in the text of the sub-clause. It is only a peculiarity as clause 1.2 (Headings and marginal notes) makes it plain that

headings and marginal notes shall not be taken into consideration in the interpretation of the contract.