delay and/or incurs cost as a result he may claim an extension of time and/or payment of cost plus profit. If the Contractor is required to take any measures as a result of the defect he is entitled to have them treated as having been instructed as variations under clause 13.3.1, and to an appropriate extension of time and/or payment accordingly, without having to claim.
2.5.2 Delayed Drawings and Instructions
As an employer‐design form of contract the Red Book contains no Employer's Requirements but the Contractor may suffer delay or disruption if the Engineer delays in providing necessary drawings or instructions; clause 1.9 of the Red Book in both editions deals with the Contractor's entitlements in the event of such delay.
Clause 1.9 in the 2017 Red Book3 provides for the Contractor to give a notice to the Engineer whenever the works are likely to be delayed or disrupted if any necessary drawing or instruction is not issued to him within a particular time, which is to be reasonable. The notice must include details of the necessary drawing or instruction, details of why and by when it should be issued, and details of the nature and amount of the delay or disruption likely to be suffered if it is late.
If the Contractor suffers delay and/or incurs cost as a result of a failure of the Engineer to issue the notified drawing or instruction within a time which is reasonable and is specified in the notice (with supporting details), the Contractor may claim an extension of time and/or payment of cost plus profit; with the proviso that if and to the extent that the Engineer's failure was caused by any error or delay by the Contractor, including an error or delay in submitting any of the Contractor's documents, then the Contractor will not be entitled to the extension or additional payment.
2.6 Use of Documents
Clauses 1.10 and 1.11 of the 2017 Red and Yellow Books and 1.9 and 1.10 of the 2017 Silver Book deal respectively with (a) the Employer's use of the Contractor's documents and (b) the Contractor's use of the Employer's documents. These are important provisions, especially from the Contractor's point of view and more especially from a design‐build Contractor's point of view.
The Employer's use of the Contractor's documents is dealt with in similar terms in all three 2017 contracts. There is, first, express provision that the Contractor is to retain copyright and other intellectual property rights in the Contractor's documents and other design documents made by or on behalf of the Contractor (in the Red Book this applies only to the extent the Contractor makes or prepares such documents). A licence is granted to the Employer by the Contractor for the copying, use and communication of the Contractor's documents and the other design documents, including making and using modifications of them, to apply throughout the actual or intended operational life of the relevant parts of the works. In the event of termination of the Contract, the Employer may continue to copy, use and communicate the relevant documents for the purpose of completing the works or, where appropriate, arranging for others to do so. Where the termination is, for example, for the Employer's convenience, the Contractor is entitled to payment. There is also an express prohibition on the documents' being used, copied or communicated to a third party by or on behalf of the Employer for purposes other than those permitted under clause 1.10 without the Contractor's prior consent.
So far as the Contractor's use of the Employer's documents is concerned, the Employer retains copyright and other intellectual property rights in the Employer's Requirements (Yellow and Silver Books) or Specification and Drawings (Red Book) and other documents made by or on behalf of the Employer, the Contractor being permitted, however, at his own cost to copy, use and communicate them for purposes of the Contract. There is also a prohibition on these documents being copied, used or communicated to a third party, except as necessary for the purposes of the Contract, without the Employer's prior consent.
2.7 Compliance with Laws
Clause 1.13 in the 1999 contracts deals with the responsibility of the Contractor and Employer to comply with applicable laws. This is dealt with by clause 1.13 in the 2017 Red and Yellow Books and 1.12 in the 2017 Silver Book but in more detail, mainly adding requirements of assistance.
In the 2017 editions, unless otherwise stated in the Employer's Requirements (Yellow and Silver Books) or Specification (Red Book), the Employer (a) is responsible for planning, zoning or building permits, permissions, licences and/or approvals for the permanent works, and (b) is to indemnify the Contractor in respect of the consequences of any delay or failure to obtain them, unless the failure is caused by the Contractor's own failure to comply with his obligations in clause 1.13(c)/1.12(c) to provide assistance; these obligations are, in turn, to provide whatever assistance is required and within the times required in the Employer's Requirements/Specification or as otherwise reasonably required by the Employer in order to enable him to obtain the relevant permits, permissions, licences and the like.
The Contractor is responsible for giving all notices, paying all taxes, duties and fees and obtaining all other permits, permissions, licences and/or approvals required by the applicable laws in relation to the execution of the works, and is also to indemnify the Employer against the consequences of any failure to do so, unless the failure is caused by the Employer's own failure to comply with his obligations under clause 2.2; these obligations are, in turn, to provide reasonable assistance at the request of the Contractor to obtain copies of the relevant local laws or necessary permits, permissions, licences and the like.
As long as the Contractor complies with his obligations under clause 1.13(c)/1.12(c) to provide assistance, if the Contractor suffers delay and/or incurs cost as a result of the Employer's delay or failure to obtain any necessary permit, permission or the like under clause 1.13(a)/1.12(a), the Contractor may claim an extension of time and/or payment of cost plus profit. If it is the Employer who incurs additional cost as a result of the Contractor's failure to comply with his assistance obligations under clause 1.13(c)/1.12(c), or with his obligations with respect to the giving of notices, paying of taxes, duties and the like or to compliance with any permits, permissions, licences and/or approvals obtained by the Employer in respect of the works (clauses 1.13(b) or (d)/1.12(b) or (d)), then the Employer may claim payment of that cost from the Contractor.
2.8 Limitation of Liability
Clause 1.15 of the 2017 Red and Yellow Books/clause 1.14 of the 2017 Silver Book limits the parties' liability to one another in connection with the Contract in two ways:
1 neither party is to be liable to the other party for ‘loss of use of any works, loss of profit, loss of any contract or for any indirect or consequential loss or damage’ with certain exceptions; and
2 a limit is placed on the total liability of the Contractor to the Employer, again with certain exceptions.
In the 1999 editions clause 17.6 also limits liability in the above two ways but with fewer exceptions.
In the 2017 editions there is an overall exception in clause 1.15/1.14, in that the clause does not limit liability in any case of ‘fraud, gross negligence, deliberate default or reckless misconduct by the defaulting Party’. The 1999 editions have a similar overall exception, except that ‘gross negligence’ is not among the types of default listed.4
2.8.1 Indirect or Consequential Loss or Damage
As mentioned above, clause 1.15/1.14 in the 2017 editions limits the parties' liability to one another in two ways.
The
