Plain-language explanations of key terms — for engineers and project managers, not lawyers.
A contractual obligation by one party to hold another harmless against specific losses, costs, or liabilities. In construction contracts, indemnity provisions typically cover personal injury, property damage, and third-party claims. Indemnities must be carefully drafted and read, as they can operate to transfer risk in unexpected ways. Under FIDIC, the mutual indemnity provisions are in Sub-Clause 17.
An engineer appointed by a lender or financing bank (rather than the employer) to monitor the construction project and report on its progress, quality, and compliance with the loan conditions. Also called a Lender's Technical Advisor (LTA). The Independent Engineer (or Lender's Engineer) is separate from the Contract Engineer, who is appointed by the employer to administer the contract.
A formal notice or letter from the employer to the contractor authorising the contractor to begin work on the project, sometimes before the formal contract documents have been executed. Also called a "letter of intent" or "notice to commence." An instruction to proceed should be treated with care, as it may create binding obligations before the full contract terms are agreed. The terms of the instruction should be carefully reviewed before acceptance.
A certificate issued by the Engineer (or Employer's Representative) at regular intervals during construction, certifying the amount due to the contractor for work completed and materials on site. Under FIDIC, the contractor submits an application (statement), which the Engineer reviews and certifies within 28 days. The employer must pay within 28 days of the certificate being issued. Late payment entitles the contractor to financing charges.