Glossary

Construction contract and disputes glossary.

Plain-English definitions of the contract and disputes terms most often used on UAE, GCC and UK infrastructure projects. Written by a practising commercial consultant, with links to the deeper analysis on the insights pages where relevant.

Accepted Programme: Under NEC, the Contractor's programme accepted by the Project Manager as compliant with clause 31.2. The reference document against which compensation events are assessed for time impact. If it is not current, recovery is materially weakened. Read more →
Adjudication: Statutory (UK Construction Act) or contractual fast-track dispute resolution. Typical timetable 28 days. The adjudicator's decision is binding pending final resolution. Common under NEC W1/W2 and bespoke UK contracts.
Bill of Quantities (BoQ): Detailed schedule of works items, quantities and rates. Forms the basis of valuation under remeasurement contracts. Inconsistencies between BoQ, drawings and specification are a common source of commercial disputes.
Compensation Event (CE): Under NEC3/NEC4, an event entitling the Contractor to additional payment and/or time. Listed at clause 60.1. Subject to a strict 28-day notification period under clause 61.3. Miss it and the entitlement is barred. Read more →
DAAB (Dispute Avoidance/Adjudication Board): Standing board appointed at the outset of a FIDIC 2017 project to assist with avoidance and resolution of disputes. Available for informal consultation, site visits, interim advice and formal adjudication. Most effective when used as a live project tool rather than a last-resort dispute body. Read more →
DIAC (Dubai International Arbitration Centre): Dubai's primary arbitral institution. The 2022 Rules replaced the 2007 Rules and changed default seat (now DIFC), consolidation and joinder mechanisms, and expedited procedure thresholds. Read more →
DIFC Courts: Independent common-law court system in the Dubai International Financial Centre. Default supervising court for DIFC-seated arbitrations under the 2022 DIAC Rules.
Early Warning: Notification under NEC clause 15 (NEC3) or clause 16 (NEC4) of any matter that could increase the total of the Prices, delay Completion, delay a Key Date or impair performance. Failure to give an Early Warning that a reasonable contractor would have given can reduce a subsequent CE assessment. Read more →
Emerald Book (FIDIC): 2019 FIDIC contract form developed with the International Tunnelling Association (ITA) specifically for underground works. Uses the Geotechnical Baseline Report as a contract document and production-rate payment mechanics. Commercially different from the Red Book in important ways. Read more →
Extension of Time (EoT): Contractual entitlement to additional time for completion as a result of a delay event. Typically requires programme-based critical-path analysis to demonstrate the impact.
FIDIC: Fédération Internationale Des Ingénieurs-Conseils. The publisher of the most widely used international construction contract suite, including the Red Book (Construction), Yellow Book (Plant & Design-Build), Silver Book (EPC/Turnkey), and Emerald Book (Underground Works).
Final Account: The final statement of value due under a construction contract, settled after practical completion. Often a substantial commercial exercise on major projects. Recovery is materially higher where close-out begins before practical completion and items are settled in real time rather than in a single end-of-project batch. Read more →
Geotechnical Baseline Report (GBR): Under the FIDIC Emerald Book, a contract document setting out the ground conditions the Contractor is expected to encounter. Pricing, programme and risk are built on the baseline. Encountered conditions that differ adversely are the Employer's risk. Read more →
ICC: Institution of Civil Engineers Conditions of Contract. Less commonly used than FIDIC or NEC internationally but still found on some Gulf rail and infrastructure programmes, particularly where international supply is involved.
JCT: Joint Contracts Tribunal. The dominant standard-form contract suite for UK building work. Less common on Gulf infrastructure, but still relevant for UK-based projects.
NEC (New Engineering Contract): Standard-form contract suite published by the Institution of Civil Engineers, widely used on UK infrastructure. Distinguished by collaborative mechanics including Early Warnings, compensation events with strict notice periods, and the Accepted Programme as a live contract document.
Notice of Claim: Under FIDIC 2017 Sub-Clause 20.2.1, a Notice that the Contractor (or Employer) intends to claim additional payment or time. Must be served within 28 days of becoming aware (or constructively aware) of the relevant event. Strict form requirements under Sub-Clause 1.3. Read more →
Notice of Dissatisfaction (NoD): Under FIDIC 2017 Sub-Clause 21.4, the notice given by a party that disputes a DAAB decision. Must be given within 28 days. Failure to issue a valid NoD means the DAAB decision becomes final and binding.
Option C (NEC): NEC contract option for target cost with pain/gain. The Contractor is reimbursed Defined Cost plus Fee, with the difference between Defined Cost plus Fee and the target Price shared between the parties according to a pain/gain schedule.
Particular Conditions: Project-specific amendments to standard-form contract general conditions. On Gulf FIDIC projects, the Particular Conditions routinely modify the standard form in consequential ways, often shifting risk to the Contractor and tightening notice regimes. Read more →
Price for Work Done to Date (PWDD): Under NEC, the cumulative value of work properly completed at the assessment date, used as the basis for interim payment certificates. Subject to retention under clause 50.3 (NEC3) or 50.5 (NEC4) where the Contractor has not maintained an Accepted Programme. Read more →
Quantum: The financial measurement of a claim or dispute. Quantum analysis is the discipline of valuing the commercial impact of an event with reference to contract mechanism, contemporaneous records, and (where applicable) expert methodology.
Red Book (FIDIC): 1999 and 2017 FIDIC Conditions of Contract for Construction. The most commonly used FIDIC form on Gulf civils and building projects. The 2017 edition introduced stricter notice regimes and the standing DAAB. Read more →
Schedule of Cost Components (SCC): Under NEC, the basis on which Defined Cost is built up for compensation event quotations and (under Option C) for interim payment. Distinct from tendered rates: a properly assessed CE quotation is built from the SCC, not from the BoQ rates. Read more →
Silver Book (FIDIC): 1999 and 2017 FIDIC Conditions of Contract for EPC/Turnkey Projects. Allocates substantially more risk to the Contractor than the Red Book and is common on Gulf large-scale industrial and infrastructure work.
Sub-Clause 20.1: Under FIDIC 2017, the introductory provision of the Claims procedure. The 28-day Notice of Claim requirement under Sub-Clause 20.2.1 is the gatekeeper for every entitlement under the contract. Read more →
Target Cost: A contract pricing mechanism (commonly under NEC Option C, but also found in FIDIC and bespoke forms) where the Contractor is reimbursed cost and a portion of any saving against, or overrun beyond, a target Price is shared between the parties.
Time-Impact Analysis: Programme-based methodology for assessing the time impact of a delay event on planned Completion. The methodology required varies by contract form; under NEC the CE quotation must include the time-impact assessment as part of the quotation.
Variation: A change to the scope of work instructed under the contract. Valuation mechanism depends on the contract form: under NEC variations are typically handled as compensation events with Defined Cost-based quotations; under FIDIC under Sub-Clause 13 with valuation under the Bill rates or fair valuation.
Yellow Book (FIDIC): 1999 and 2017 FIDIC Conditions of Contract for Plant and Design-Build. Used where the Contractor takes design responsibility for plant or facilities procurement. Less commonly used than Red or Silver but appears on Gulf systems and utility projects.

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