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FIDIC Clause 20 Explained: Claims, Disputes & Arbitration Process in 1999 vs 2017

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FIDIC Clause 20 Explained

1️⃣ Purpose of Clause 20 (FIDIC Yellow Book)

Let’s dive into the heart of Clause 20 (in the 1999 edition, called “Claims, Disputes and Arbitration,” and in the 2017 edition split across Clauses 20 and 21). Essentially, it’s the “engine room” for managing disagreements, ensuring everybody knows what to do when something goes wrong or extra costs or delays pop up. But there’s so much more to it—so let’s break down the purpose in a conversational, engaging way:

A. Protecting Both Parties’ Interests

At its core, Clause 20 exists to protect both the Employer and the Contractor. It isn’t all about contractors claiming money or employers disputing issues; it’s about fairness. This clause sets out a common-sense approach:

  1. Raise a claim (time or money).
  2. Handle the claim quickly, with proper notice and evidence.
  3. If there’s a dispute, try to resolve it amicably and, if needed, go to an adjudicator or arbitration.

The big idea is to prevent issues from spiraling out of control. If either side feels it’s owed additional time or cost, or if there’s any disagreement that can’t be settled easily, Clause 20 says, “Here’s the step-by-step solution.”

B. Creating a Structured “Road Map” for Claims

Clause 20 is essentially a how-to manual for making (or challenging) a claim. In FIDIC 1999, Clause 20 lumps Contractor’s and Employer’s claims together but focuses mostly on the Contractor’s claim process (with Employer’s Claims shown in Clause 2.5). The 2017 edition reorganizes it so that Clause 20 explicitly covers Employer’s and Contractor’s Claims, while Clause 21 deals with the resolution steps (amicable, adjudication, arbitration).

Why do we have so many steps? Because the FIDIC approach is “notice first, then we talk.” This ensures nobody springs a claim on the other side at the last minute. Everybody is required to keep records, gather facts, and attempt to find common ground early. The Clause 20 “road map” typically means:

  1. Notify (often within 28 days) that a claim event occurred.
  2. Gather & share contemporary records (daily site logs, cost data, etc.).
  3. Submit a fully detailed claim with costs and time calculations.
  4. Engineer or relevant person reviews and makes a determination.
  5. Either accept that determination or escalate further.

This structure is there to keep the project moving and force the parties to address potential problems quickly.

C. Encouraging Early Dispute Avoidance

A huge purpose behind Clause 20—and especially in FIDIC 2017—is not just to fix a problem after it happens, but to avoid it becoming a bigger dispute. The 2017 edition formally introduced the Dispute Avoidance/Adjudication Board (DAAB) in Clause 21. Still, the seeds of that idea begin in Clause 20 through prompt notices and the emphasis on resolution at the Engineer level.

How does early avoidance happen?

The thinking is: if you spot a problem early, clarify it, and talk it out, you’re less likely to end up in a formal legal battle.

D. Time-Barring and Clarity

Another key purpose behind Clause 20 is making sure everyone stays organized and meets deadlines for raising issues. If you’re reading the Clause for the first time, you’ll see repeated references to things like “28 days to give notice” or specific time frames for the Engineer to respond.

FIDIC’s goal is clarity. You have a timeframe; you must follow it. That approach reflects best practices in project management: be systematic, keep records, notify promptly, resolve quickly.

E. Streamlined Dispute Resolution

Finally, Clause 20 (together with Clause 21 in the 2017 edition) lays out how disputes will be managed if they can’t be solved at the claim/determination stage:

  1. Adjudication or DAB/DAAB: A fast-track, interim binding process.
  2. Amicable settlement window: Time for the parties to talk or negotiate further.
  3. Arbitration: The ultimate last resort if all else fails.

Why go through these steps? Because FIDIC recognized that large-scale construction and engineering projects are complex. You need an efficient “chain of escalation” to keep projects from freezing. This chain ensures each party knows:

F. The Bottom Line

So, in short, the purpose of Clause 20 in both editions is to:

  1. Define how to submit, handle, and evaluate claims (by Contractor and Employer).
  2. Promote early exchange of information and timely resolution.
  3. Provide a formal, step-by-step blueprint if disagreements become real disputes.
  4. Balance the risk between Employer and Contractor by ensuring each side is aware of responsibilities, deadlines, and procedures.

Think of Clause 20 as the handshake agreement that says, “When something goes sideways, we won’t run to the courts first—we’ll follow a careful procedure, keep the project going, and do our best to resolve issues with minimal drama.” That is the beating heart of FIDIC’s claim and dispute-resolution philosophy.

“Better to fix a problem today with clear communication than fix it tomorrow in arbitration.”
— An experienced FIDIC user

In the next items (2–7), the focus goes deeper into subclauses, what they actually say, how they’re interpreted, examples of cross-references, potential pitfalls, hypothetical scenarios, improvements, and practical takeaways. But if you remember only one thing about Clause 20, remember: it’s the go-to section for dealing with extra time, extra money, or major disagreements—helping keep your project on track when the going gets tough.

2️⃣ Breakdown of Clause 20

Below is a deeper look at how Clause 20 is structured in the FIDIC Yellow Book (1999) and in the FIDIC Yellow Book (2017). You can think of Clause 20 as a “compass” that directs everyone on how to raise, review, and ultimately resolve claims. Here, we’ll walk through each key subclause (or cluster of them), focusing on what it covers, why it’s there, and how it works in practice.

1999 Edition: “Claims, Disputes and Arbitration” Under One Roof

In the 1999 version, Clause 20 has everything in one place: Contractor’s Claims, DAB procedures, amicable settlement, and arbitration. Let’s go through the subclauses:

  1. Sub-Clause 20.1 – Contractor’s Claims
    • What it says: If the Contractor believes they’re entitled to extra time or money (e.g., unforeseen site conditions, changes in legislation, or Employer-caused delays), they must serve notice within 28 days of becoming aware of the event or circumstance.
    • Why it matters: This is the official “heads up” system. If you wait too long, you might lose the right to claim (i.e., it could become “time-barred”).
    • Key details:
      • Must keep contemporary records (daily logs, invoices, diaries).
      • Must submit a fully detailed claim with cost/time specifics soon after giving notice.
      • The Engineer then reviews and determines entitlement under Sub-Clause 3.5 (Determinations).
  2. Sub-Clauses 20.2–20.4 – Dispute Adjudication Board (DAB)
    • What they say: Introduces the DAB, a panel (one or three persons) that steps in if either party disputes the Engineer’s determination.
    • Why it matters: The DAB is meant to be a quick and interim-binding fix, so the project doesn’t grind to a halt.
    • Key details:
      • 20.2 deals with appointment. If the parties fail to agree on a DAB, FIDIC can help appoint.
      • 20.3 covers failure to agree on the DAB.
      • 20.4 describes how to obtain the DAB’s decision (often within 84 days).
  3. Sub-Clause 20.5 – Amicable Settlement
    • What it says: If a party is unhappy with the DAB’s decision, or if the DAB never formed, they should attempt amicable settlement for at least 56 days before arbitration.
    • Why it matters: Encourages folks to sit down and talk. Pushing them to try settlement can save time, money, and relationships.
  4. Sub-Clause 20.6 – Arbitration
    • What it says: If no amicable settlement happens in that time, the dispute may go to arbitration (usually under ICC Rules, unless otherwise specified in the Particular Conditions).
    • Why it matters: Arbitration is the final resolution step. It’s binding, so once you get here, you’re in a formal process akin to going to court, but typically more specialized for construction disputes.
  5. Sub-Clauses 20.7 & 20.8
    • 20.7: Failure to Comply with the DAB’s Decision—basically says if a party ignores the DAB’s binding decision, the other can go straight to arbitration.
    • 20.8: Expiry of the DAB’s Appointment—the DAB’s role may end when the project ends, or earlier if the contract says so.

Overall, the 1999 Clause 20 lumps claims, disputes, and arbitration together, which can be a bit confusing but keeps everything in a single “dispute resolution hub.”

2017 Edition: Claims in Clause 20 + Disputes in Clause 21

With the 2017 update, FIDIC decided to separate claims and dispute resolution, making them clearer:

Clause 20: Employer’s and Contractor’s Claims

  1. Sub-Clause 20.1 – Claims
    • What it says: A “Claim” is any request for payment, extension of time (EOT), or other relief by either the Contractor or the Employer (unlike 1999, where the Employer’s Claims appear separately in Clause 2.5).
    • Why it matters: Now it’s explicit: the Employer, too, must serve notice if they want to claim set-offs or other entitlements from the Contractor.
  2. Sub-Clause 20.2 – Claims For Payment and/or EOT
    This is the “meat” of the claim process:
    • 20.2.1 – Notice of Claim
      • Must be given within 28 days of the claiming party becoming aware (or should have become aware) of the event. If you’re late, you risk losing the claim.
    • 20.2.2 – Engineer’s Initial Response
      • The Engineer must respond, usually in writing, acknowledging the claim or asking for more details.
    • 20.2.3 – Contemporary Records
      • The claiming party keeps relevant records that show extra cost or delay. FIDIC is big on real-time evidence.
    • 20.2.4 – Fully Detailed Claim
      • Within 42 days (or as stated in the contract) after giving notice, you must submit a thorough claim, including the quantum and the time impact.
    • 20.2.5 – Agreement or Determination of the Claim
      • The Engineer tries to see if parties agree. If not, the Engineer makes a formal determination (similar to 1999’s approach).
    • 20.2.6 – Claims of Continuing Effect
      • If the event’s effect keeps going (e.g., ongoing delay), you can submit interim claims.
    • 20.2.7 – General Requirements
      • Summarizes things like who signs the claim, how communication occurs, etc.

Clause 21: Disputes and Arbitration

All the “if still we can’t agree” steps move here:

Yes, this is reminiscent of FIDIC 1999, but with added stress on “avoidance” and a more systematic approach (e.g., the Engineer making determinations, then parties going to DAAB if needed).

Key Observations in Both Editions

  1. Time-Bars
    • Both editions have a big emphasis on notifying within 28 days. Missing that window often means losing the claim—big risk for the Contractor or Employer.
  2. Engineer’s Role
    • In 1999: The Engineer still does the first pass determination under Sub-Clause 20.1.
    • In 2017: The Engineer’s role is spelled out in Sub-Clause 20.2 (review claims, request more info, propose determinations).
  3. Adjudication
    • 1999 uses a DAB (Dispute Adjudication Board).
    • 2017 uses a DAAB (Dispute Avoidance/Adjudication Board), with an added mission to help parties avoid formal disputes early.
  4. Amicable Settlement
    • Both require a cooling-off or settlement attempt (commonly 56 days) before going to arbitration. This is FIDIC’s “talk before you fight” approach.
  5. Arbitration
    • The final step in both versions is typically international arbitration if everything else fails.

Practical Takeaways

In a Nutshell

Clause 20 (1999) or Clause 20 + Clause 21 (2017) works like a funnel:

  1. Issue arises → Notice (28 days).
  2. Engineer reviews → tries to settle/decide.
  3. Still no agreement? → DAB/DAAB steps in.
  4. Still no luck? → Amicable settlement attempt.
  5. Finally → Arbitration as the last resort.

It’s thorough, yes—but the key point is ensuring that every claim (whether from the Employer or the Contractor) is handled systematically, on time, and with good records. That structure is the backbone of Clause 20.

3️⃣ Key Interpretations and Implications

Now that we’ve seen how Clause 20 is organized in both the 1999 and 2017 editions, let’s explore some of its big-picture meanings and practical impacts. This part answers questions like: “Why does FIDIC impose strict 28-day notices?” “What happens if the Engineer drags their feet?” and “Can the Contractor or Employer lose out on compensation because they forgot to keep records?” Here’s the lowdown:

A. The “28-Day Notice” Time Bar: Why So Strict?

Almost everything in Clause 20 begins with a requirement that the claiming party (Contractor or Employer) must serve a notice within 28 days of becoming aware (or should have become aware) of the potential claim event.

  1. Interpretation:
    • That 28-day clock is not just a guideline; it’s typically a hard time bar. If you’re late without a compelling excuse, you risk losing your claim (though some courts/arbitrators may still allow it under equity principles, depending on the law).
  2. Implication:
    • For Contractors: Delaying your notice = possible forfeiture of extra money or time.
    • For Employers (especially in FIDIC 2017): Failing to give prompt notice of an Employer’s claim means you might lose the right to set off costs or impose damages.

Remember: FIDIC’s objective is to push both sides to speak up quickly so that the issue can be addressed on-the-spot, with real-time data (🔎 “contemporary records”).

B. Contemporary Records: The “Show Me the Evidence” Principle

Both the 1999 and 2017 editions emphasize that contemporary records must be kept, from daily site logs to cost ledgers.

  1. Interpretation:
    • FIDIC wants a factual basis for every claim—not just a back-of-the-napkin guess or a statement like “We lost 2 weeks, so we want 2 weeks’ cost.”
  2. Implication:
    • If your records are sloppy or missing, the Engineer (and later the adjudicator or arbitrator) will be less inclined to grant your claim.
    • Well-kept records = strong position.

Pro-Tip: Some contractors keep daily diaries of manpower, deliveries, weather, site conditions, etc. This is vital “fuel” for Clause 20 claims.

C. The Engineer’s Determination: Neutral or Biased?

In theory, the Engineer is supposed to be impartial when deciding a claim. However, many wonder, “But the Engineer is appointed (and paid) by the Employer—how neutral can they be?” FIDIC’s approach:

  1. Interpretation:
    • Despite the Employer footing the bill, the Engineer is expected to act “fairly” in determining claims (1999: Sub-Clause 3.5; 2017: Sub-Clause 3.7).
  2. Implication:
    • Good Engineers do their best to maintain professional independence.
    • If the Engineer is perceived as biased, it could push more disputes to the DAB/DAAB.

Common Riddle: “Can we skip the Engineer and go straight to arbitration?” Typically no. FIDIC wants an Engineer’s decision (or the attempt, at least) before full-blown arbitration.

D. Adjudication: Quick and Interim-Binding

1999: DAB (Dispute Adjudication Board)

2017: DAAB (Dispute Avoidance/Adjudication Board)

  1. Interpretation:
    • The Board’s decision is binding, but “interim.” That means it must be followed, even if you plan to challenge it later in arbitration.
  2. Implication:
    • You can keep working, keep the project going, and comply with the DAAB decision—for now. If you still object, you can escalate. This helps maintain a steady cash flow and progress on site.

E. Amicable Settlement: The Last Chance Before War ⚖️

Both 1999 and 2017 specify a “cooling off” or amicable settlement period before arbitration.

F. Time-Bar Realities (Late Notice and Late Engineer Responses)

  1. Late Notice by Contractor
    • Miss the 28 days? Likely your claim is out. (In 2017, this is especially explicit: “The claim is time-barred.”)
  2. Engineer Misses Deadline
    • If the Engineer fails to respond in the specified period, the 2017 edition says the claim may be “deemed rejected” so you can then escalate. This prevents indefinite limbo.

G. “Claims of Continuing Effect”

In large projects, some events cause rolling delays or costs. Both versions let you submit interim claims if you can’t finalize the numbers yet:

H. Employer’s Claims: 2017’s New Twist

In 1999, the Employer’s claim (e.g., wanting to recover advanced payment or impose certain damages) was in Clause 2.5. In 2017, it’s folded into Clause 20 so that the same procedure (notice, records, engineer’s determination) applies to both parties:

I. What If There’s Already a Claim Under Another Clause?

You might see references to Clause 8 (delays), Clause 4.12 (unforeseeable conditions), or Clause 13 (variations). Typically:

J. Real-Life Impact

  1. More Administrative Overhead
    • Clause 20 demands discipline: timely notices, well-kept evidence, adherence to procedural steps.
    • This overhead can feel burdensome, but it fosters clarity and helps both parties avoid surprises.
  2. Risk Allocation
    • If a Contractor is disorganized or misses deadlines, they take the risk of losing big claims.
    • The Employer must also watch out for their own claims (like liquidated damages or set-offs).
  3. Keeping the Project Going
    • The interim-binding nature of the DAB/DAAB decisions means that large sums can flow even while the dispute is unresolved in the final sense. That helps the project continue.

K. Rhetorical Questions to Ponder

  1. Can a handshake and a verbal “We’ll sort it out later” stand up if a formal notice was never sent?
    • Likely not. Clause 20 loves written notices.
  2. Could the Engineer side with the Employer by default?
    • If they do, expect the Contractor to escalate to DAB/DAAB or arbitration if they strongly disagree—leading to more friction and potential cost/time.
  3. Is there a way to settle quickly if both parties want to avoid the cost of a DAB/DAAB?
    • Absolutely: direct negotiation or mediation is often a good solution, as long as everyone respects the contractual steps if negotiations fail.

L. The Bottom Line

Clause 20 is not just “red tape”—it’s a self-contained system for handling claims and disputes so the project can keep rolling. It protects both parties by demanding prompt action, documentation, and fair procedures.

  1. Interpretations revolve around ensuring fairness, transparency, and efficiency.
  2. Implications stretch from “do your admin properly” to “you might lose your rights if you’re late or sloppy.”

In real-world terms: If you’re a Contractor, keep that calendar and file folder handy; if you’re the Employer, stay aware of the same time bars and do your own recordkeeping. Everyone’s best friend in Clause 20 is “Don’t Wait, Communicate.”

4️⃣ Cross-Referencing with Other Clauses

What makes Clause 20 (whether in the 1999 or 2017 edition) especially important is how it weaves together with so many other FIDIC clauses. FIDIC contracts aren’t just a pile of disconnected rules; they’re a carefully orchestrated system where Clause 20 is the main highway for claims, but side roads from other clauses feed onto it. Here’s a look at some of those “side roads,” the key interactions, and why they matter in real-world projects:

A. Clause 2 (The Employer) – Employer’s Claims in 1999

B. Clause 3 (The Engineer) – Determinations

Why the cross-reference? Because Clause 20 says, “You have to get a determination from the Engineer first (unless the contract specifically modifies that step).” The chain is:

  1. Notice.
  2. Engineer’s review/determination.
  3. Possible dissatisfaction → Clause 20 dispute route.

C. Clause 4 (The Contractor) – Records and Notice

D. Clause 8 (Commencement, Delays, and Suspension)

Why the cross-reference? Because any claim for more time or for delay damages must be channelled properly. Clause 8 says “Hey, you’re entitled to X if Y happens,” but Clause 20 is the engine that processes the claim or dispute.

E. Clause 13 (Variations and Adjustments)

F. Clause 14 (Contract Price and Payment)

G. Clause 17 (Risk and Responsibility) & Clause 18 (Exceptional Events)

H. Overall Interaction Map

We can visualize Clause 20’s cross-referencing like a spiderweb:

All roads lead to Clause 20 if we’re talking about unsettled claims for time or money.

I. Why Does This Web Matter?

  1. Consistent Method: FIDIC wants one consistent method (Clause 20) for finalizing claims, no matter if it’s a delay, unforeseen site conditions, a Variation dispute, or an Employer’s set-off.
  2. Ease of Management: Both parties know exactly where to look for notice procedures, time frames, and required evidence.
  3. No Surprises: Because each clause cross-refers to Clause 20, it’s harder for a party to say, “Oh, I didn’t know I had to submit a notice.”

J. A Handy “Cross-Reference” Example

K. The Bottom Line

Clause 20 is not a lone island. Almost every other major clause eventually says, “If you want to claim time or money, or if there’s a dispute, use Clause 20’s road map.” This cross-referencing ensures that no matter where a problem arises—variations, force majeure, late payment, unforeseen ground conditions—everyone knows:

  1. Send the right notice to the Engineer in time.
  2. Keep and share the relevant documents.
  3. Look to Clause 20 if an impasse hits.

In that sense, Clause 20 is the central processing hub for your entire FIDIC-based project. It keeps the entire contract consistent, ensuring that no matter why you need a claim, you’ll always follow the same procedure to get from confusion → determination → resolution.

5️⃣ What If Scenarios?

Nothing tests the practical usefulness of Clause 20 quite like real-world “what if” stories. These scenarios illustrate how different situations might play out, why timing and recordkeeping matter, and how the dispute-resolution chain actually works on a day-to-day basis. Grab a coffee, and let’s imagine some typical predicaments you could face under FIDIC!

Scenario 1: “Oops, We Forgot the 28-Day Notice!”

Takeaway: No matter how hectic the site is, send your notice on time—even if all the claim details aren’t ready yet.

Scenario 2: Employer’s Delay to Provide Site Access

Takeaway: When the Employer delays site access, Clause 20 is the correct path to get more time and reimbursement.

Scenario 3: Multiple Overlapping Claims

Takeaway: Keep your events clearly documented. Overlapping claims are common; FIDIC still wants them handled with separate notices and thorough records.

Scenario 4: The Engineer Is Silent

Takeaway: The Engineer’s “foot-dragging” won’t hold you hostage forever. FIDIC has built-in “deemed” responses.

Scenario 5: Continuing Effect

Takeaway: “Continuing effect” means you can’t wait for the event to be totally done—keep the Engineer in the loop with partial claims.

Scenario 6: The DAAB’s Decision Is Ignored

Takeaway: The DAB/DAAB’s decision isn’t optional. Even though it’s “interim-binding,” ignoring it can fast-track you to arbitration, typically with legal costs.

Scenario 7: Employer’s Liquidated Damages

Takeaway: Liquidated damages claims also pass through Clause 20’s procedural funnel—no party can unilaterally impose or ignore them.

Conclusion: Clause 20’s “What If” = Solid Roadmap

These scenarios underscore why Clause 20 is such a cornerstone:

In real life, these “what ifs” show up constantly—delays, design issues, missing site access, uncooperative parties, storms, double claims, you name it. Clause 20’s structure helps ensure each problem has a formal route to resolution, which keeps your project from descending into chaos.

6️⃣ Suggestions for Clarity and Improvement

When it comes to Clause 20, there’s plenty of opportunity to smooth out ambiguities and tailor the contract to your specific project and local conditions—especially in the Particular Conditions. Below are some conversational yet detailed suggestions, complete with examples and potential revised wording in line with FIDIC’s Golden Principles (GP), along with references to typical approaches in Particular Conditions. Let’s dive in:

A. Define “Should Have Become Aware” (Time Bar Nuance)

One recurring headache is the phrase “became aware or should have become aware” for triggering the 28-day notice. People argue endlessly about when exactly that is. To reduce disputes:

Original Text (simplified from FIDIC 2017):

“The claiming Party shall give Notice of Claim within 28 days after the claiming Party became aware, or should have become aware, of the event or circumstance…”

Suggested Modification:

“The claiming Party shall give Notice of Claim within 28 days of the date the claiming Party first knew or, acting reasonably, ought to have known of the relevant event or circumstance. For clarity, ‘acting reasonably’ includes performing routine inspections and due diligence as required under Clause 4.10 [Site Data].”

B. Clarify the Outcome of Late Notice

FIDIC 2017 is quite explicit that late notice can time-bar the claim. However, you might want a moderated approach: if the Employer/Engineer hasn’t suffered prejudice from the late notice, the claim is still allowable.

Original 2017 Wording (simplified):

“If the claiming Party fails to give notice within 28 days, any entitlement to EOT or additional payment shall be lost.”

Suggested Modification (Particular Conditions):

“If the claiming Party fails to provide the required notice within 28 days, the Engineer may (following consultation with both Parties) disallow all or part of the claim only to the extent that the late notice has caused prejudice. In assessing prejudice, the Engineer shall consider whether the other Party was deprived of an opportunity to mitigate the impact of the event or circumstance.”

C. Expand on Employer’s Claims (Mirroring Contractor’s Requirements)

In FIDIC 2017, Clause 20 merges Employer and Contractor claims. However, you might want to double down on that equality. For instance:

Add a sub-paragraph to emphasize the Employer’s need for the same contemporary records standard:

“When the Employer asserts a claim for delay damages or other relief, the Employer shall comply with the same obligations under Sub-Clause 20.2.3 [Contemporary Records] and Sub-Clause 20.2.4 [Fully Detailed Claim].”

D. Streamline the Engineer’s Determination Deadlines

Engineers sometimes miss deadlines or remain silent. To avoid frustration:

Original:

“The Engineer shall proceed to agree or determine the claim within 42 days…”

Proposed Amendment:

“The Engineer shall review and give a preliminary response within 21 days, stating any additional information required. A final determination shall be issued within a further 21 days from receipt of such additional information or from expiry of the 21-day preliminary review period. If the Engineer does not respond within this total of 42 days, the claim shall be deemed rejected, allowing the claiming Party to proceed under Clause 21 [Disputes and Arbitration] without further notice.”

E. Referencing Specific Technical Standards (India Example)

If your project is in India (or any specific region), you can insert a subclause referencing local standards for the records or dispute resolution:

“If any claim arises from compliance with local regulations (e.g., BIS codes for design standards), the claiming Party shall provide the relevant references to IS: xxx or other statutory codes in its fully detailed claim submission under Sub-Clause 20.2.4.”

F. Encourage Mediation or Early Neutral Evaluation

Sometimes, Parties want an alternative middle step between the Engineer’s determination and the DAB/DAAB. You can add:

“Before referring a dispute to the DAAB under Clause 21, either Party may propose an independent mediation or Early Neutral Evaluation. If the other Party agrees, the 56-day amicable settlement period shall include this mediation/Evaluation. This provision does not override the mandatory steps of Clause 20, but supplements them where mutually agreed.”

G. Clarify “Standing” DAAB vs. “Ad-Hoc” DAB

If you prefer to have a permanent, “standing” Dispute Avoidance/Adjudication Board onsite:

Suggested Particular Condition:

“A Standing DAAB shall be appointed within 56 days from the Commencement Date, in accordance with Sub-Clause 21.1. The DAAB shall visit the Site every [x months] (or as deemed necessary) to proactively identify potential disputes, provide informal guidance, and encourage resolution under Clause 20 before disputes crystallize.”

H. Provide a Roadmap for Adjusting Claims for Partial Approvals

Sometimes an Engineer partially approves claims. You can add a subclause about how partial approvals get documented and if a new claim must be raised:

“If the Engineer issues a partial determination for a claim under Sub-Clause 20.2.5, the claiming Party may, within 14 days, issue a revised statement with updated cost/time calculations. The Engineer shall treat this as a continuation of the initial claim rather than a separate claim, unless the parties agree otherwise.”

I. Ensure All Amendments Follow GP2 and GP4

J. Example Particular Condition Text Block

Here’s a short illustration combining some suggestions:

“PC 20.2.1: Notice of Claim (Replacement)
The text of General Conditions Sub-Clause 20.2.1 is deleted in its entirety and replaced with the following:
(a) The claiming Party shall give Notice of Claim within 28 days of the date the claiming Party first knew, or acting reasonably should have known, of the relevant event or circumstance.
(b) If such Notice is not provided within this period, the claiming Party’s entitlement to an extension of time or additional payment shall be reduced only to the extent the late notice has caused prejudice to the other Party, as determined by the Engineer.
(c) The Engineer shall issue a preliminary response under Sub-Clause 20.2.2 within 14 days of receiving this Notice, identifying any missing information.”

K. Summing Up the Improvement Strategy

  1. Define ambiguous triggers like “should have become aware.”
  2. Give partial grace on late notice if no real harm done—BUT keep the discipline.
  3. Upgrade Engineer’s deadlines to avoid silent delays.
  4. Treat Employer’s claims with the same thorough notice and record-keeping.
  5. Encourage optional ADR steps (mediation) without undermining the formal chain.
  6. Comply with Golden Principles by labeling each revision carefully.

💡 Pro-Tip

When drafting or revising Clause 20 in Particular Conditions, track each addition with a short note explaining “this aims to fix [specific potential conflict].” This helps everyone see the logic behind your changes—and ensures your modifications don’t inadvertently break a different Clause.

The Final Word

By tweaking Clause 20 with the above ideas, you’ll give everyone a clearer roadmap, reduce confusion about deadlines and prejudice, and keep your contract’s dispute resolution system aligned with FIDIC Golden Principles. Ultimately, good drafting here means fewer messy standoffs, more timely solutions, and a smoother project for both Employer and Contractor.

7️⃣ Final Takeaways

Key differences for these Clauses under 1999/2017

Below is a side-by-side table comparing the key Clause 20 provisions in the FIDIC Yellow Book 1999 and the FIDIC Yellow Book 2017, with short verbatim excerpts and explanations of the major differences. Note that for brevity (and to adhere to usage rules) each quoted snippet is concise.

Sub-ClauseFIDIC 1999FIDIC 2017Key Differences
20.1
(Contractor’s Claims, 1999)
vs.
20.2
(Claims For Payment/EOT, 2017)		Short Verbatim (1999)
“The Contractor shall give notice to the Engineer… within 28 days of becoming aware…”		Short Verbatim (2017)
“The claiming Party shall give Notice of Claim within 28 days after it became aware, or should have…“		1. Claiming Party: 1999 references Contractor; 2017 applies to both Contractor & Employer.
2. Time Bar: 2017 explicitly states the claim is “time-barred” if late, clarifying consequences more firmly.
3. Scope: 1999’s separate Employer’s Claims in Sub-Clause 2.5; 2017 merges them into Clause 20.
20.2–20.4
(DAB in 1999)
vs.
21.1–21.4
(DAAB in 2017)		Short Verbatim (1999)
“Dispute Adjudication Board… shall be one or three suitably qualified persons…”		Short Verbatim (2017)
“The DAAB (Dispute Avoidance/Adjudication Board)… may give informal assistance to prevent disputes…”		**1. Name/Role: 1999 calls it “DAB” (Dispute Adjudication Board); 2017 calls it “DAAB” (Dispute Avoidance/Adjudication Board).
**2. Dispute Avoidance: 2017 emphasizes an early, proactive approach.
**3. Procedures: 2017 clarifies the steps for DAAB decisions, timeframes, and “avoidance” visits.
20.5
(Amicable Settlement, 1999)
vs.
21.5
(Amicable Settlement, 2017)		Short Verbatim (1999)
“Each Party shall attempt to settle the dispute amicably before commencement of arbitration.”		Short Verbatim (2017)
“The Parties shall attempt to settle amicably before giving a Notice of Arbitration…”		**1. Timing: 1999 sets 56 days after DAB decision for amicable settlement. 2017 also prescribes a period but updates references to the DAAB.
**2. Formality: Both require a “cooling off” phase pre-arbitration. 2017’s language is more structured in referencing Clause 21 steps.
20.6
(Arbitration, 1999)
vs.
21.6
(Arbitration, 2017)		Short Verbatim (1999)
“Unless settled amicably, any dispute… shall be finally settled by international arbitration…”		Short Verbatim (2017)
“Any Dispute not resolved under this Clause shall be referred to arbitration…”		**1. Separation: 2017 moves final arbitration to Clause 21.
**2. Intermediate Steps: In 1999, everything is in Clause 20. In 2017, dispute resolution is in Clause 21, building on the DAAB and amicable settlement steps in more detail.
**3. Clarity: 2017 reaffirms arbitration as the ultimate remedy but clarifies references to prior procedures.
20.7 & 20.8
(1999) vs.
21.7 & 21.8
(2017)		Short Verbatim (1999)
“Failure to Comply with DAB’s Decision” and “Expiry of the DAB’s Appointment”		Short Verbatim (2017)
“Failure to Comply with DAAB’s Decision” and “No DAAB In Place”		**1. Refusal to Comply: Both versions let a party jump directly to arbitration if DAB/DAAB decision is ignored.
**2. Appointment End: 1999 references DAB expiry; 2017 includes “No DAAB in Place” scenario.
**3. Avoidance Emphasis: 2017 adds more details on DAAB involvement and re-appointment or references if the DAAB’s membership ends.

Additional Observations

  1. Scope of Clause 20:
    • 1999 lumps all Contractor’s claims, DAB procedures, amicable settlement, arbitration under Clause 20.
    • 2017 splits it between Clause 20 (claims from both Contractor and Employer) and Clause 21 (dispute resolution steps: DAAB, amicable settlement, arbitration).
  2. Employer’s Claims:
    • In 1999: Employer’s claims appear in Sub-Clause 2.5, referencing Clause 20 if contested.
    • In 2017: Both parties’ claims are covered under Sub-Clause 20.2, giving a symmetrical approach.
  3. Time-Bar:
    • 1999 implies but does not always explicitly state a total “loss of claim” if late.
    • 2017 explicitly states the claim is barred if the party misses the notice window.
  4. Dispute Avoidance:
    • 1999’s DAB is typically formed once a dispute arises (or occasionally as a standing board).
    • 2017’s DAAB is more proactive, designed for early site visits and informal opinions to avoid disputes from festering.

In a nutshell:

Checklists

Below is a checklist table for managing Clause 20 (Claims) under both FIDIC 1999 and FIDIC 2017. Each row outlines a key step or requirement, with a final column for you to tick off progress or compliance. Feel free to adapt or expand based on your project specifics.

#Checklist ItemDescription / GuidanceSub-Clause ReferenceCheck
1.Event Trigger & AwarenessHas the party identified the specific event or circumstance giving rise to a claim (delay, additional cost, etc.)?20.1 (1999) / 20.2.1 (2017)[ ]
2.Timely Notice of ClaimWas notice issued within 28 days of becoming (or should have become) aware of the claim event?20.1 (1999) / 20.2.1 (2017)[ ]
3.Contemporary RecordsAre relevant daily logs, site diaries, cost ledgers, etc., documented to substantiate the claim?20.1 (1999) / 20.2.3 (2017)[ ]
4.Fully Detailed ClaimHas a complete claim (time/cost calculations, justification, references to contract clauses) been submitted?20.1 (1999) / 20.2.4 (2017)[ ]
5.Engineer’s Initial ResponseHas the Engineer acknowledged or requested further info in response to the claim notice (within specified days)?20.1 (1999) / 20.2.2 (2017)[ ]
6.Engineer’s DeterminationHas the Engineer issued a fair determination (or partial acceptance) within the contractual timeline?20.1 (1999) / 20.2.5 (2017)[ ]
7.Time-Bar ComplianceCheck if late notice or missing data might disqualify or reduce the claim (especially 2017 edition).20.1 (1999) / 20.2.1 (2017)[ ]
8.Continuing Effect (if applicable)If the issue is ongoing, have you submitted interim/follow-up claims as required by contract?20.1 (1999) / 20.2.6 (2017)[ ]
9.Adjudication Board StepsIf the claim is disputed, have you referred it to DAB (1999) or DAAB (2017) per the correct procedure/timeline?20.2–20.4 (1999) / 21.1–21.4 (2017)[ ]
10.Amicable Settlement WindowHave you observed the mandatory “cooling-off” (56 days, typically) before arbitration?20.5 (1999) / 21.5 (2017)[ ]
11.Final ArbitrationIf unresolved, has the dispute been properly referred to arbitration (not skipping prior steps)?20.6 (1999) / 21.6 (2017)[ ]
12.Employer’s Claims (if applicable)For 1999: Check Sub-Clause 2.5 references to Clause 20. For 2017: Ensure Employer follows same notice/record steps.2.5 & 20.1 (1999) / 20.2 (2017)[ ]

How to Use:

  1. Periodically review this checklist alongside project events.
  2. Tick off the right column to ensure compliance is up to date.
  3. Document everything: keep a log of relevant communications, dates, and references so you can answer “Yes!” in each box confidently.

With this checklist, you can stay on top of Clause 20 requirements and avoid the most common pitfalls (like missing the 28-day notice or failing to keep proper records).

Sample Letters

Below are some sample letters tailored to various Clause 20 scenarios (in both FIDIC 1999 and 2017 contexts). These are illustrative only—always adapt to your project’s specific facts, references, and timelines. The core idea is to follow the spirit of Clause 20: timely notices, clarity, and references to the Contract.

1. Notice of Claim (Contractor to Engineer/Employer)

Scenario: The Contractor discovers a delay event, unexpected site condition, or any cause for an extension of time or additional cost. They have 28 days from becoming aware.

Subject: Notice of Claim – [Brief Event Description]

Date: [Date of Letter]

To: [Engineer’s Name / Employer’s Representative] From: [Contractor’s Authorized Representative]

Dear [Engineer’s Name / Employer’s Representative],

Sub-Clause [20.1 (1999) or 20.2.1 (2017)] – Notice of Claim

We write to give formal notice of a claim under Sub-Clause [20.1 / 20.2.1], arising from the following event or circumstance:

  1. Event/Cause: [Describe event—e.g., Late access to Site Area B; Discovery of unforeseen utilities, etc.]
  2. Date of Occurrence or Discovery: [Date Contractor first became aware or should have become aware]
  3. Immediate Impact: [e.g., Delays to earthworks, Additional manpower costs, etc.]
  4. Preliminary Estimate:
    • Time Impact: [X days/weeks]
    • Cost Impact: [Provide approximate sum or to be detailed later if continuing effect]

We confirm that contemporary records are being kept in accordance with Sub-Clause [20.1 / 20.2.3]. We will submit a fully detailed claim as soon as practicable, and within the time limit stated in Sub-Clause [20.1 (1999) / 20.2.4 (2017)].

Thank you for your prompt attention to this matter. Should you require additional information, kindly advise as soon as possible.

Yours faithfully,

[Signature]
[Name]
[Title / Position]
[Contractor’s Organization]

2. Fully Detailed Claim (Contractor to Engineer)

Scenario: After issuing the initial notice, the Contractor submits the full claim with supporting data.

Subject: Fully Detailed Claim – [Event Reference / Claim No.]

Date: [Date of Letter]

To: [Engineer’s Name]
From: [Contractor’s Authorized Representative]

Dear [Engineer’s Name],

Sub-Clause [20.1 (1999) / 20.2.4 (2017)] – Submission of Fully Detailed Claim

Following our initial Notice of Claim dated [date], we now submit our fully detailed claim for your review and determination. This claim arises from:

  1. Event Description: [Late site handover, Variation No. X, Unforeseen ground conditions, etc.]
  2. Chronology: Provide a timeline of events, from the trigger date to key milestones.
  3. Cause and Effect: Clearly link the event to the resulting delay or additional cost.
  4. Records and Evidence:
    • Appendix A: Site diaries, daily manpower logs.
    • Appendix B: Correspondence logs confirming access constraints.
    • Appendix C: Cost breakdown (labor rates, equipment standby charges, overheads, etc.).
  5. Claimed Entitlement:
    • Extension of Time: [XX days/weeks]
    • Additional Payment: [Currency & amount, with references to calculations]

We hereby request the Engineer’s determination pursuant to Sub-Clause [3.5 (1999) / 3.7 (2017)] at the earliest convenience and within the time period specified in the Contract.

We trust this submission is sufficiently detailed, but please inform us promptly should you need further clarification.

Yours faithfully,

[Signature]
[Name]
[Title / Position]
[Contractor’s Organization]

3. Engineer’s Determination (Engineer to Contractor/Employer)

Scenario: The Engineer has reviewed the claim and issues a formal determination.

Subject: Engineer’s Determination – [Claim No. / Reference]

Date: [Date of Letter]

To: [Contractor’s Representative]
Cc: [Employer’s Representative]

Dear [Contractor’s Name / Representative],

Sub-Clause [3.5 (1999) / 3.7 (2017)] – Engineer’s Determination

Further to your fully detailed claim dated [date], I have carefully reviewed all submitted documentation, contemporary records, and have consulted both Parties in an attempt to reach agreement. As per Sub-Clause [3.5 / 3.7], I now provide the following determination:

  1. Event Description: [Summarize the claim event briefly]
  2. Reviewed Evidence: Confirm you received all relevant logs, cost breakdowns, etc.
  3. Assessment:
    • Extension of Time: [X days/weeks granted or reasons if partially/fully rejected]
    • Additional Payment: [Amount determined or reasons if partially/fully rejected]
    • Conditions: [Any further requirements, e.g., the Contractor must mitigate additional delays, or further records are required]
  4. Reasons: Summarize the basis for granting or rejecting each element of the claim, referencing Contract clauses.

This determination is binding unless and until revised by a [DAB/DAAB decision] or amicable settlement/arbitration. Should either Party disagree with any aspect, the Clause 20 (or Clause 21 in 2017) dispute resolution procedures are available.

Yours faithfully,

[Signature]
[Name, Title]
[Engineer’s Organization]

4. Notice of Dissatisfaction (Either Party to Engineer/Other Party)

Scenario: One Party disputes the Engineer’s determination and wants to escalate to DAB/DAAB or further.

Subject: Notice of Dissatisfaction – Engineer’s Determination [Ref.]

Date: [Date of Letter]

To: [Engineer’s Name / Other Party]
From: [Party’s Representative]

Dear [Engineer / Employer / Contractor’s Name],

Sub-Clause [20.4 / 3.5–3.7 references (1999/2017)] – Notice of Dissatisfaction

We refer to your determination dated [date] regarding [Claim No. / Variation Dispute / EOT]. We hereby issue a Notice of Dissatisfaction for the following reasons:

  1. Areas of Disagreement: [List specific aspects—EOT duration too short, cost disallowed, etc.]
  2. Supporting Rationale: [Summarize additional evidence or arguments not accepted by the determination.]

We now wish to proceed in accordance with Clause 20 (1999) or Clause 21 (2017) for further resolution, namely referral to the [DAB / DAAB] under [Sub-Clause 20.4 (1999) / 21.4 (2017)], unless an amicable settlement can be reached.

Yours faithfully,

[Signature]
[Name]
[Title / Position]
[Party’s Organization]

5. Notice to Refer Dispute to DAB/DAAB (Either Party to the DAB/DAAB, copying Other Party)

Scenario: The dispute remains unsettled; a Party formally refers it to the Dispute Board.

Subject: Referral to [DAB / DAAB] – Dispute [Reference]

Date: [Date of Letter]

To: [DAB/DAAB Chair or Member(s)]
Cc: [Other Party, Engineer]

Dear [Chairperson / Member(s) of DAB/DAAB],

Sub-Clause [20.4 (1999) / 21.4 (2017)] – Referral of Dispute

Pursuant to the Contract between [Employer] and [Contractor] dated [date], we hereby refer the following Dispute to the [DAB / DAAB] for decision:

  1. Dispute Overview: [Summarize the claim or determination contested, including reference numbers and key dates.]
  2. History: Outline attempts at amicable settlement or partial resolutions.
  3. Relevant Documents:
    • [Attach copies of the claim, Engineer’s determination, Notice of Dissatisfaction, etc.]
  4. Relief Sought: [State the remedy—extension of time, cost, or removal of liability, etc.]

We request the [DAB / DAAB] to review and issue a decision within the timeframe specified in Sub-Clause [20.4 (1999) / 21.4.3 (2017)].

Thank you for your prompt consideration. We remain available to clarify or provide further evidence as needed.

Yours faithfully,

[Signature]
[Name]
[Title / Position]
[Organization]

6. Notice of Intent for Amicable Settlement (Either Party to the Other)

Scenario: The DAB/DAAB decision has been issued; a Party is dissatisfied but must attempt amicable settlement before arbitration.

Subject: Initiation of Amicable Settlement Discussions

Date: [Date of Letter]

To: [Other Party’s Representative]
Cc: [Engineer, DAAB Chair]

Dear [Name],

Sub-Clause [20.5 (1999) / 21.5 (2017)] – Amicable Settlement

In reference to the [DAB / DAAB decision] dated [date], we are not fully satisfied with the outcome. However, we acknowledge the obligation under Sub-Clause [20.5 / 21.5] to attempt an amicable settlement for at least [56 days or stated period] before proceeding to arbitration.

We propose commencing discussions:

  1. Suggested Meeting Date: [Propose 2–3 options for date/time]
  2. Location / Virtual: [Indicate if in-person or online]
  3. Agenda: Exchange of viewpoints, exploring possible compromise or partial acceptance.

Should you have an alternative proposal for the settlement framework (e.g., mediation), please advise promptly. We look forward to an open and constructive dialogue to resolve the dispute amicably.

Yours sincerely,

[Signature]
[Name]
[Title / Position]
[Party’s Organization]

7. Referral to Arbitration (Either Party to the Other)

Scenario: Amicable settlement fails or the mandatory period passes; a Party now moves to arbitration.

Subject: Commencement of Arbitration Proceedings

Date: [Date of Letter]

To: [Other Party’s Representative]
Cc: [Engineer, DAAB Chair, Arbitrator (if appointed)]

Dear [Name],

Sub-Clause [20.6 (1999) / 21.6 (2017)] – Reference to Arbitration

Despite our efforts at amicable resolution following the [DAB / DAAB] decision, we regret that no mutually acceptable settlement has been reached. In accordance with Sub-Clause [20.6 (1999) / 21.6 (2017)], we hereby refer the unresolved dispute(s) to arbitration. The key details are as follows:

  1. Dispute Reference: [Identify the core dispute as described in earlier notices]
  2. Previous Steps: [DAB/DAAB decision date, Notice of Dissatisfaction date, Amicable settlement period end date]
  3. Arbitral Rules: [Identify the rules stated in Particular Conditions, e.g., ICC or UNCITRAL]
  4. Relief Sought: [Concise statement of the remedy or sum claimed]

Please note we shall proceed in compliance with the [applicable arbitral rules / seat of arbitration / institution] as specified in the Contract.

Yours sincerely,

[Signature]
[Name]
[Title / Position]
[Party’s Organization]

Final Tips for Drafting These Letters

  1. Always quote the correct sub-clause from your version of FIDIC (1999 or 2017) and indicate if referencing GC or Particular Conditions.
  2. Keep it timely: The 28-day notice is crucial.
  3. Attach relevant evidence: Contemporary records, cost breakdowns, site diaries—anything that bolsters your position.
  4. Be concise but clear: State the essential facts and link them to the contract clauses.
  5. Send copies (cc) to all relevant parties (Engineer, Employer, DAAB members, etc.) to ensure transparent communication.

These samples, though not official FIDIC forms, follow the typical structure seen in real FIDIC-based projects and should help guide your communications under Clause 20.

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Sequence of Interaction for these Clauses

Below is a typical sequence showing how Clause 20 (in both FIDIC 1999 and FIDIC 2017) unfolds when handling claims and disputes, along with parallel references to the corresponding sub-clauses. While the 1999 edition keeps everything under Clause 20, the 2017 edition splits claims (Clause 20) and disputes (Clause 21). This outline will help you see the step-by-step interactions between Contractor, Employer, Engineer, DAB/DAAB, and eventually arbitration.

1. Identify Claim Event or Circumstance

  1. Contractor (or Employer, in 2017) recognizes a situation that may warrant additional time, cost, or other compensation.
  2. Example triggers: Variations, late site access, unforeseeable conditions, design changes, etc.

2. Send Notice of Claim

Key Action: The claiming party must give notice (within 28 days of awareness). Failure may time-bar the claim (especially explicit in 2017).

3. Keep Contemporary Records

Key Action: The claimant gathers and keeps site logs, cost data, diaries, or other evidence to support the claim.

4. Submit Fully Detailed Claim

Key Action: Provide calculations, cost breakdown, schedule impact, referencing contract clauses.

5. Engineer’s Initial Response (if required)

Key Action: Engineer acknowledges claim, may ask for more info, sets timeline for determination process.

6. Engineer’s Determination

Key Action:

7. Notice of Dissatisfaction (if determination is disputed)

Key Action:

8. Adjudication Step (DAB or DAAB)

Key Action:

9. Amicable Settlement

Key Action:

10. Arbitration

Key Action:

11. Non-Compliance or Expiry Clauses

Key Action:

Putting It All Together

  1. Event occurs → identify potential claim.
  2. Notice (28 days) + keep contemporary records.
  3. Fully detailed claim submitted to the Engineer (or the Employer in 2017, if reversed roles).
  4. Engineer tries to settle or gives a determination.
  5. If not agreed → possible DAB/DAAB referral.
  6. Still unresolved → amicable settlement attempt.
  7. Ultimately → arbitration if no agreement.

That’s the typical sequence of interactions for Clause 20 under FIDIC 1999 and 2017, ensuring each dispute or claim travels a consistent path from notice to final resolution.

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