What is the purpose of Clause 14.4 in the FIDIC Yellow Book 1999?

Clause 14.4 serves to establish a structured framework for managing the flow of payments within a construction project. It specifically addresses the integration with a Schedule of Payments, the exclusion of Clause 14.5 in certain situations, flexibility in adjusting instalments, and the submission of estimates in the absence of a predefined schedule.

When does Clause 14.4 come into play in a construction project?

Clause 14.4 comes into play when determining the sequence and structure of payments within a project governed by the FIDIC Yellow Book 1999. It addresses how payments are to be calculated, adjusted, and submitted, particularly in relation to the presence or absence of a Schedule of Payments.

What is the significance of a Schedule of Payments in Clause 14.4?

The Schedule of Payments, when included in the Contract, serves as a predefined framework for payment instalments. Clause 14.4 integrates these instalments with the payment certificate applications (Clause 14.3), providing clarity and predictability in the payment process.

Can adjustments be made to instalments in the Schedule of Payments?

Yes, adjustments can be made if the actual progress on the project deviates from the planned benchmarks. Clause 14.4 allows for flexibility in adjusting instalments, and the Engineer may collaborate with the Contractor to make necessary adjustments.

Why is Sub-Clause 14.5 excluded in certain situations in Clause 14.4?

When a Schedule of Payments is in place, Clause 14.4 excludes the application of Sub-Clause 14.5. This exclusion streamlines the payment process by focusing on predetermined instalments and does not consider specific provisions related to Plant and Materials in payment calculations.

Under what circumstances can adjustments be made to instalments in Clause 14.4?

Adjustments to instalments can be made when the actual progress on the project deviates from the planned benchmarks. If such deviations occur, the Engineer, in collaboration with the Contractor, can adjust instalments to align with the revised project timeline.

When does the Contractor submit non-binding estimates in the absence of a Schedule of Payments?

If the Contract does not include a Schedule of Payments, the Contractor is required to submit non-binding estimates of expected payments during each quarterly period. The first estimate is submitted within 42 days after the Commencement Date, with revised estimates submitted at quarterly intervals until the Taking-Over Certificate is issued.

Are the estimates submitted by the Contractor binding in Clause 14.4?

No, the estimates submitted by the Contractor in the absence of a Schedule of Payments are non-binding. They serve as a mechanism for financial planning and are subject to adjustment based on the actual progress of the project.

Schedule of Payments – Understanding Clause 14.4 [of FIDIC Yellow Book 1999]

By wisdomwaveshub.com / November 17, 2023

In the intricate tapestry of FIDIC Yellow Book 1999, Clause 14.4 - Schedule of Payments unveils a structured framework for managing the flow of financial transactions within the contractual landscape.

Insight Seeker Yearly Membership Required

You must be a Insight Seeker Yearly member to access this content.

Join Now

Already a member? Log in here