In construction contracts issued by the International Federation of Consulting Engineers, unexpected and uncontrollable events that affect project execution are addressed under the concept of “Exceptional Events,” previously known as force majeure. This concept is clearly defined in modern FIDIC forms, including the FIDIC Red Book and the FIDIC Yellow Book, particularly in the 2017 editions, where the terminology and structure were updated to provide greater clarity and balance between the contracting parties.
Exceptional Events refer to events that are beyond the reasonable control of the affected party, could not have been reasonably foreseen, and could not have been avoided or overcome. These may include natural disasters such as earthquakes or floods, war, terrorism, civil unrest, or other extreme circumstances that prevent the performance of contractual obligations. The key principle is that the event must not be attributable to either party’s fault or negligence.
When an Exceptional Event occurs, the affected party is required to promptly notify the other party, usually through the Engineer, describing the nature of the event, its impact, and the expected duration of disruption. This notification is essential to trigger contractual relief mechanisms. Depending on the severity and duration of the event, FIDIC contracts may allow for an extension of time, suspension of work, or, in extreme cases, termination of the contract.
One of the primary forms of relief under Exceptional Events is an Extension of Time (EOT). If the event delays the completion of the works, the Contractor is typically entitled to an adjustment of the Time for Completion. However, monetary compensation is generally limited. In most cases, the Contractor may not be entitled to additional cost unless the contract specifically provides otherwise. This reflects the principle that Exceptional Events are shared risks rather than Employer liabilities.
If the Exceptional Event continues for an extended period, the contract may allow either party to terminate the agreement. Termination under these circumstances is not considered a breach but rather a contractual response to a situation where performance has become impossible or impractical. In such cases, the contract outlines procedures for payment, demobilization, and settlement of outstanding obligations.
In conclusion, the treatment of force majeure—now referred to as Exceptional Events in FIDIC 2017 contracts—provides a structured and balanced approach to managing unforeseen disruptions. By clearly defining the conditions, notification requirements, and relief mechanisms, the contract ensures fairness while maintaining project discipline. This framework helps both parties manage extreme risks in a predictable and contractual manner, reducing uncertainty in complex construction projects.
