Contractor is carefully set out in sub-clause 39.

2 where the Contractor is given "a

reasonable time" where no time is specified by the Engineer. In some instances,
where items are not critical, six months may be a reasonable time. Yet, if 28
days go past, the Contractor is at risk of termination. See also the commentary
under clause 63.1.

This clause should be read in conjunction with clause 17 (Setting-out) whereby

the Contractor has power to order the re-execution of works due to dimensional
or alignment errors.

A new feature of the 4th Edition is the reference to design at item (c)(ii); this fills a
gap because an element of the works may be wrong despite the materials, plant
and workmanship being in accordance with the contract. Before this edition, the
Employer would have had to base his rejection of badly designed work on breach
of the responsibility given to the Contractor for design under clause 8.2 (Site
operations and methods of construction). See also clause 7.2 (Permanent
Works designed by Contractor). The inclusion of work or materials in an interim
certificate does not mean that those works and materials are in any sense
approved. See clause 61.1 (Approval only by Defects Liability Certificate) and
the commentary thereunder.

39.2 The sanction provided by this sub-clause is far more immediate and
effective than the threat of termination which is unlikely to be in the interests of
either party. The threat of the disruption and expense of alternative contractors
entering the site and executing a part of the works would provide a very real
incentive to the Contractor.

For other clauses involving work by other contractors, see clause 31

(Opportunities for other contractors), clause 49.4 (Contractors failure to carry out
instructions) and clause 63.1 (Default of Contractor).

If the work or materials had been paid for in interim certificates, the Employer's
deduction would amount to the entire cost of the other contractor; if not paid for
the deduction would be limited to any additional cost to the Employer of having
an alternative contractor carry out the works.

CLAUSE 40 : Suspension of Works

If the Engineer so instructs, the Contractor is to suspend all or any part of the
works and properly protect and secure the works as the Engineer thinks
necessary for the duration of such suspension. Unless the suspension is either
provided for in the contract, or is the Contractor's responsibility, or is necessary
due to the weather, the proper execution or safety of the works (for a reason not
being the Employer's responsibility), the Contractor will be reimbursed.

The Engineer will determine the extension of time and costs to be granted to the
Contractor.

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If a suspension of all or any part of the works for which the Contractor is to be
compensated lasts for 12 weeks, the Contractor can give notice requiring
permission to proceed within 4 weeks. If permission is not given, the Contractor
may give notice and treat the part of the works as omitted or, where all the works
were suspended, terminate under clause 69.1 (Default of Employer).

There have been a number of changes of vocabulary and arrangement in the 4th
Edition but the principles of the 3rd Edition remain intact. In particular, the
provision for extension of time and additional cost has been put into a separate
sub-clause 40.2.

40.1 Other express provision for suspension is found in these conditions only at
clause 69.4 (Contractor's entitlement to suspend work), whereby the Contractor
is entitled to suspend if he is not paid within 4 weeks after the due date for
payment of a certificate and after 4 weeks of giving notice to the Employer.
Clause 45.1 (Restriction on working hours) also imposes restraints and the
contract may expressly provide for periods of suspension during religious
festivals, sod-cutting ceremonies etc.

"...default of or breach of Contract by the Contractor". The draftsman of the 4th

Edition has added the words "or breach of contract" to the word "default" on three
occasions in this contract, the others being clause 44.1 (Extension of time for
completion) and clause 51.1 (Variations). On each occasion the words relate to
misdemeanours by the Contractor: the same "belt and braces" approach has not
been thought necessary in relation to the Employer's failings. The rationale may
be that as the term "default" has been used, albeit in the clause titles only, in
clause 63.1 (Default of Contractor) and clause 69.1 (Default of Employer), the
draftsman may have considered it necessary to make clear that a default in this
context does not necessarily need to be a default which would entitle the
Employer to terminate.

"(c) necessary by reason of climatic conditions on the Site". This contract places
the risk of delays caused by weather upon the Contractor unless he can
demonstrate that he has suffered "exceptionally adverse climatic conditions"
under clause 44.1 (Extension of time for completion) item (c). If the climatic
conditions that give rise to the suspension can be shown to be "exceptionally
adverse", it is submitted that the Contractor will still be entitled to an extension of
time under clause 44.1 but no reimbursement under clause 40.2. It would defeat
the object of the allocation of risk if an Engineer could keep the Employer's
entitlement to liquidated damages alive by suspending the works whenever
exceptionally adverse climatic conditions occurred. See also clause 11.1
(Inspection of Site) and clause 12.2 (Adverse physical obstructions or conditions)
for other references to climatic conditions and clause 20.4 (Employer's risks) for
the phrase "any operation of the forces of nature".

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"(d) necessary for the proper execution of the Works...". In circumstances were
the Employer is having difficulty in funding the works, it is possible on the present
wording to see an argument that where the suspension occurs in order to give
the Employer time to re-organise his funding and in circumstances where all
certificates have been and will continue to be paid, exception (d) will apply and
the Contractor will not be entitled to time and money. The Employer would argue
that the suspension is necessary for the proper execution of the works and does
not arise from any act or default on the Employer's part. Such an argument
certainly runs counter to the intention of the clause and should be defeated on
the grounds that "proper execution" relates to conformity with the contract and
not whether the contract can be executed at all.

Suspension may be necessary "for the proper execution of the works" in

circumstances where a Contractor is, through poor organisation, insufficient
labour etc., failing to cope to the detriment of the works. In those circumstances,
the Engineer could probably call a halt to the work to allow and require the
Contractor to put in place a proper organisation and level of manpower before
proceeding.

The risks defined in clause 20.4 (Employer's risks) range from war and hostilities
through loss or damage due to design, to "any operation of the forces of nature".
If a suspension was caused by, for example, the flooding of the works, such that
it fell within clause 20.4(h) "any operation of the forces of nature", there could be
conflict with items (c) and (d) of this sub-clause. It is noteworthy that item (c)
refers to climatic conditions only "on the Site" so that if the flood occurred due to
heavy rainfall elsewhere, there would be no difficulty. This overlap should it is
submitted be dealt with so that damage to the works resulting from such an event
is recoverable by the Contractor but costs and time flowing from a related
suspension would not be granted.

The Engineer is entitled to instruct suspension whenever he considers it

necessary. No guidance is given as to the circumstances in which the power
may be exercised so the question is whether the Engineer may use it at the
Employer's request, for instance in circumstances where the Employer is having
funding difficulties. Clause 2.6 (Engineer to act impartially) does not apply to
instructions although the ordering of a suspension could certainly amount to the
exercise of a discretion "which may affect the rights and obligations" of the
parties. Thus, it may well be arguable that the Engineer is obliged to exercise his
right to order suspension impartially. In circumstances where the Employer is
asking the Engineer to order suspension to enable the Employer to overcome
funding difficulties, the Engineer may well consider his power to grant time and
money and the Contractor's power under clause 40.3 to bring about the omission
of a suspended part or the termination of the contract as a whole results in no
unfairness to either party with the result that he could impartially agree to
suspend at the Employer's request.

40.2 This sub-clause is new to the 4th Edition and is consistent with the
draftsman's policy of spelling out in some detail the Engineer's obligations to

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consult and determine time and money. The cost incurred by the Contractor by
reason of the suspension would no doubt include the costs of protecting and
securing the suspended works.

40.3 If items (b) to (d) of clause 40.1 apply, the Employer's entitlement to have
the work suspended is limited only by the Engineer's view of how long the
suspension is necessary. If the ground for suspension is the outbreak of war, the
Employer may terminate the contract under clause 65.6 (Outbreak of war).
Similarly, if the cause of the suspension is a frustrating event, clause 66.1
(Release from performance) may apply, releasing both parties from further
performance.

If the suspension is due to the Employer's funding difficulties, the Employer may
give notice under clause 69.1 (Default of Employer) that "for unforeseen reasons,
due to economic dislocation, it is impossible for him to continue". This sub-
clause adds a new ground for termination by the Contractor under clause 69.1:
see the commentary under that clause.

The Contractor is given the option whether to bring the suspension to a head or
not and may be content with an extension of time and reimbursement of his costs
indefinitely. In some circumstances the Employer, through the Engineer, will also
be given a choice of whether to suspend the work, thereby potentially giving the
Contractor a right to terminate, or whether to grant the Contractor extensions of
time as necessary. For example, the Employer may find himself unable to give
possession of part of the site to the Contractor. He could suspend all or part of
the works or simply allow the Engineer to grant extensions of time pursuant to
clause 42.2 (Failure to give possession). There may be no difference in costs
payable to the Contractor as the Contractor's ability to demobilise any part of his
labour force or equipment would depend in either case upon the Engineer's
instructions and the parties' views as to how long the delay would be likely to last
and how quickly the Contractor would be required to resume working. The
Employer could therefore prevent the Contractor having the option to terminate.

CLAUSE 40.3 (Suspension lasting more than 84 days)

"If the progress of the Works or any part thereof is suspended on the written
instructions of the Engineer ..."

The word in italics has been removed, no doubt because of clause 2.5
(Instructions in writing) which states that "instructions given by the Engineer shall
be in writing". Unfortunately, the remainder of clause 2.5 deals with oral
instructions. The effect of the deletion therefore is to permit an oral instruction to
suspend, provided it is followed by confirmation of the instruction by the
Contractor to the Engineer. As this could lead to the termination of the contract,
the wisdom of the deletion is questionable.

Nevertheless, the deletion of the reference to writing removes an anomaly as

sub-clause 40.1 (Suspension of work) has no express reference to the instruction

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