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GC-35 Warranty

Subcontractor warrants that the design, basic and detailed engineering of the Project and any part thereof shall be performed by Subcontractor in accordance with accepted international standards of good engineering, management and industrial practices; conform to the specifications and descriptions set forth in the Subcontract documents; meet the performance guarantees stated in this Subcontract and function accordingly.

Subcontractor warrants that the construction and workmanship under this Subcontract shall be executed in a professional and workmanlike manner, be free from defects and conform to specifications and other requirements contained in the Subcontract documents or with other specifications mutually agreed upon.

Subcontractor guarantees title to all goods procured and/or supplied by it and warrants the merchantability and fitness of such goods for the use intended under this Subcontract. Subcontractor further warrants that all goods designed, specified and procured by it and used for or included in the Installations shall be new and conform to the specifications contained in the Subcontract or with other specifications mutually agreed upon and that such goods used for or installed, shall be procured only from good, reputable and responsible vendors. If any such items are found defective, Subcontractor shall at Contractor’s and/or Owner’s option, rectify or replace such defective item at its own cost.

Subcontractor warrants the safety, soundness and stability of the Installations and its liability therefrom, shall be subject to the mandatory provisions of the laws of the nation.

Painting & Coating Work Warranty

Subcontractor warrants that the paint and coatings used on the Installations shall be free from defects, fit for the purpose. its preparation and application shall be carried out in conformity with the specifications in a professional and workmanlike manner by certified personnel

If at any time until the expiry of the warranty period, the Work, Installations or the design or basic and detailed engineering thereof, are shown to be defective, deficient or otherwise inadequate by reason of any act, breach, default or omission by Subcontractor whether negligent or not or should Subcontractor fail to comply with the representations and warranties set forth in this Subcontract then Subcontractor shall, at its own cost and expense, promptly re-perform all necessary work whereby such corrections and changes to the Work, Installations and the design, basic and detailed engineering thereof are carried out as are necessary to remedy or correct the said defects, deficiencies or inadequacies and to meet the said representations and warranties including without limitation:

a. procuring, testing, inspecting, insuring, freighting and shipping of repaired or replacement goods to the Jobsite;

b. dismantling the affected goods, Installations and reinstalling repaired or replacement goods, Installations; and

c. testing or re-testing the whole or any part of the Installations so affected.

If Subcontractor fails to meet its warranty obligations or to re-perform work or rectify or remedy any defects, deficiencies or inadequacies in the Work, Installations within a reasonable time after receipt of a written notice by Contractor so to do then Contractor may re-perform the work or rectify or remedy the defects or deficiencies or inadequacies or procure the services of others to do so at Subcontractor risk who shall bear all costs incurred as a result thereof and Contractor shall be entitled to deduct the whole or any costs or expenses incurred from any monies due to Subcontractor under this Subcontract or otherwise recover them from Subcontractor.

The foregoing warranties shall not be interpreted as a limitation upon but are in addition to all other warranties and guarantees expressed in the Subcontract which shall apply in all respect of the Work.

The Warranty Period is as defined in Special Condition SC-1 titled “Definitions”

Except as otherwise stated in below with respect to the Decennial Structure Warranty and Extensions to Warranty Period, the guarantees, representations and warranties given by Subcontractor, the liability of Subcontractor to correct and remedy defects, deficiencies or inadequacies, shall apply throughout the Warranty Period and provided that Subcontractor has fulfilled all its warranty and other obligations under this Subcontract and subject to Subcontractor having issued to Contractor a form of release in a format agreed by Contractor, Contractor shall issue the final acceptance certificate to Subcontractor at the end of Warranty Period.
Any Work re-performed, replaced, remedied or rectified hereunder shall itself be warranted by Subcontractor on the terms of this clause for a single period of twelve (12) months commencing from the date of acceptance by Contractor of such re-performed, replaced, remedied or rectified Work provided however that the Warranty Period shall not in aggregate exceed twenty-seven (27) months from the effective date of the issuance of Plant Test Run Certificate or twenty-four (24) months from the effective date of the last Provisional Acceptance Certificate but without prejudice to the provisions below in respect of any extended warranty.
If in the period following the commencement of Warranty Period, re-performance or rectification of any defective, deficient or inadequate Work causes the entire plant or systems to be shut down, the representations and warranties and the liability of Subcontractor to correct and remedy defects, deficiencies or inadequacies shall remain in force and issuance of the Final Acceptance Certificate be deferred by a period of time equal to the period from shutdown until the completion of the re-performance or rectification of the defective, deficient or inadequate Work and acceptance thereof by Contractor.
Extensions To Warranty Period

Subcontractor’s liability to re-perform, rectify and remedy defects, deficiencies or inadequacies in the Work, Installations shall extend beyond the Warranty Period in the following circumstances:

(a) Subcontractor’s decennial liability to OWNER stated above shall continue until it expires in accordance with the laws of the nation

(b) Subcontractor shall be considered to have discharged any painting warranty on the expiry of a period of five (5) years from the date of issuing the last Provisional Acceptance Certificate.

Any other warranty obligation expressly stated in the Subcontract to survive the Warranty Period.
Subcontractor's Primary Responsibility

Subcontractor shall be primarily liable with respect to all guarantees, representations and warranties set forth in the Subcontract including warranties with respect to its subcontractors or vendors whether or not, any event or defect, deficiency or inadequacy is covered by a subcontractor or vendor warranty and Contractor need only seek recourse from Subcontractor for re-performance, rectification or remedial action.

Rework, repair or remove and replace defective equipment and materials or re-perform defective workmanship to acceptable quality at a time and in a manner acceptable to Contractor;

Cooperate with others assigned by Contractor to correct such defects and pay to Contractor all actual costs reasonably incurred by Contractor in performing corrective actions; or

Propose and negotiate in good faith an equitable reduction in the Subcontract price in lieu of corrective action.

At an appropriate time to be decided at Owner’s and/or Contractor’s sole discretion, but in any case prior to the end of the Warranty Period, a warranty shutdown of the Installations shall be conducted to inspect and record the condition of the Installations. The shutdown may, at the discretion of the Contractor be performed in modular fashion to suit Owner’s operational requirements

Subcontractor shall prior to commencement of the remedial work demonstrate its readiness in terms of adequate resources and manpower and all such work shall be performed on a round the clock basis.

GC-36 Backcharges

Contractor may, in addition to any other amounts to be retained hereunder, retain from any sums otherwise owing to Subcontractor amounts sufficient to cover the full costs of any of the following:

Subcontractor’s failure to comply with any provision of this Subcontract or Subcontractor’s acts or omissions in the performance of any part of this Subcontract but not limited to violation of any applicable law, order, rule or regulation including those regarding safety, hazardous materials or environmental requirements;

Correction of defective or nonconforming work by redesign, repair, rework, replacement or other appropriate means when Subcontractor states or by its actions indicates that it is unable or unshalling to proceed with corrective action in a reasonable time; and/or

Contractor agrees to or is required to take action or perform work for Subcontractor such as cleanup, off-loading or completion of incomplete work.

Contractor may also backcharge against Subcontractor for work done or cost incurred to remedy these or any other Subcontractor defaults, errors, omissions or failures to perform or observe any part of this Subcontract. Contractor may, but shall not be required to give Subcontractor written notice before performing such actions or work or incurring such cost.
The cost of backcharge work shall include:

Incurred labour costs including all payroll additives;

Incurred net delivered material costs;

Incurred lower-tier supplier and subcontractor costs directly related to performing the corrective action;

Equipment and tool rentals at prevailing rates in the Jobsite area; and

A factor of sixty percent (60%) applied to the total of Items for Contractor's overhead, supervision and administrative costs.

The backcharge notice may request Subcontractor's concurrence for Contractor to proceed with the required action or work. Subcontractor’s failure to concur shall not impair Contractor's right to proceed with the action or work under this or any other provision of this Subcontract.
Contractor shall separately invoice or deduct from payments otherwise due to Subcontractor the backcharge costs. Contractor's right to backcharge is in addition to any / all other rights and remedies provided in this Subcontract or by law. The performance of backcharge work by Contractor shall not relieve Subcontractor of any of its responsibilities under this Subcontract including but not limited to express or implied warranties, specified standards for quality, contractual liabilities, indemnifications as well as meeting the Subcontract Milestones of the Special Condition titled "Commencement, Progress and Completion Of The Work."

GC-37 Indemnity

Subcontractor hereby releases and shall indemnify, defend, hold harmless Contractor, Owner, their subsidiaries, affiliates and the officers, agents, employees, successors, assignees and authorized representatives of all the foregoing from and against any and all suits, actions, legal or administrative proceedings, claims, demands, damages, liabilities, interest, attorney's fees, costs, expenses, and losses of whatsoever kind or nature in connection with or incidental to the performance of this Subcontract, whether arising before or after completion of the Work hereunder in any manner directly or indirectly caused, occasioned or contributed to in whole or in part or claimed to be caused, occasioned or contributed to in whole or in part by reason of any act, omission, fault or negligence whether active or passive of Subcontractor, its lower-tier suppliers, subcontractors or of anyone acting under its direction or control or on its behalf.
The foregoing shall include but is not limited to indemnity for:

Property damage and injury to or death of any person including employees of Contractor, Owner or Subcontractor.

The breach by Subcontractor of any representation, warranty, covenant or performance obligation of this Subcontract.
Subcontractor's aforesaid release, indemnity and hold harmless obligations, or portions or applications thereof, shall apply even in the event of the fault or negligence whether active or passive or strict liability of the parties released, indemnified or held harmless to the fullest extent permitted by law but in no event shall these apply to liability caused by the shallful misconduct or sole negligence of the party released, indemnified or held harmless.

GC-38 Patent And Intellectual Property Indemnity

Except in respect to items that have been specified by Contractor or are supplied to Subcontractor by Contractor or on Contractor’s behalf, Subcontractor shall at its expense, indemnify, defend and hold harmless Contractor and Owner from and against any claims, actions, suits costs (including legal and experts’ costs), expenses and liabilities of every kind and nature which may be brought against or incurred by Contractor or Owner at any time for infringement or alleged infringement of any intellectual property that may be specified or used by Subcontractor or its subcontractors relating to:

the use, design, composition, mode of fabrication or other particulars of the Installations or any one or more of the elements of apparatus, structures, systems, plant or any combination thereof or any part thereof furnished or specified for the Work.

the use of any raw, unfabricated or unassembled materials, composition of various materials, fabrication procedure, heat treatment or other things entering into the manufacture of said element of apparatus, structures or systems or plant or any part thereof or

the use of any construction methods, tools, machines or construction devices used in or specified for the execution of Work; and

the design, process and / or technology used in the installations, plant, systems or incorporated therein.
Contractor shall promptly notify Subcontractor in writing of such claims or the institution of such action or suit and permit Subcontractor to conduct Contractor’s defence. Subcontractor shall pay all costs and expenses of any such action or suit, including compensation and expenses of experts and counsel of its choice and selection. Subcontractor shall also pay and hold Contractor and Owner free and harmless from expenses incurred or any damages or other sums awarded or assessed in any such action or suit.
Contractor reserves the right to conduct its own defence and be represented by counsel of its own selection, but in either event agrees to co-operate in the defence of any such action or suit and to furnish all the evidence in its control.

In connection with any claims, actions, suits or liabilities referred to in above, Subcontractor reserves the right to acquire at its expense, immunity from suit or licence under intellectual property on which such claims, actions, suits or liabilities are related for the construction, operation or use and maintenance of Installations by Contractor in accordance with the design, specifications and procedures furnished and/or approved in writing by Subcontractor or its subcontractors.

Contractor also reserves the right, in connection with such claims, actions, suits or liabilities of making such alteration to Work or Installations at Subcontractor’s expense, as may be required to eliminate the alleged infringement, provided however, that such alteration does not impair the safe operation or use of the Installations or unreasonably interfere with their continuous operation or results in any cost or expenses on the part of Contractor.

GC-39 Assignments And Subcontracts

Any assignment of this Subcontract or rights hereunder in whole or part, without the prior written consent of Contractor shall be void except that upon ten (10) calendar days written notice to Contractor, Subcontractor may assign monies due or to become due under this Subcontract provided that any assignment of monies shall be subject to proper set-offs in favour of Contractor and any deductions provided for in this Subcontract.
Subcontractor shall not subcontract to any third party for the performance of all or any portion of the Work without the advance written approval of Contractor. Purchase orders and subcontracts of any tier must include provisions to secure all rights and remedies of Contractor and Owner provided under this Subcontract and must impose upon the lower‑tier supplier and subcontractor all of the duties and obligations required to fulfill this Subcontract.
Subcontractor shall, in selection of any proposed lower tier subcontractor, ensure that such proposed subcontractor complies with the selection criteria as defined in Appendix A-2 to these General Conditions.
Copies of all purchase orders and subcontracts are to be provided to Contractor upon request. Pricing may be deleted unless the compensation to be paid thereunder is reimbursable under this Subcontract.
No assignment or subcontract shall be approved which in essence amount to relieve Subcontractor or its sureties if any, of their responsibilities under this Subcontract.
Subcontractor shall be fully responsible for any part of Work performed by its lower tier subcontractor(s), for their acts, omissions by persons either directly or indirectly employed to the same extent as it is for the acts and omissions of persons directly employed by Subcontractor)
Subcontractor shall ensure that lower tier subcontractor(s) are officially registered in the nation to the extent it is required by applicable laws and that they and their employees comply with sponsorship, immigration, residence and employment laws while in the nation.

GC-40 Suspension

Contractor may by written notice to Subcontractor, suspend at any time the performance of all or any portion of the Work to be performed under the Subcontract. Upon receipt of such notice, Subcontractor shall, unless the notice requires otherwise:

Immediately discontinue work on the date and to the extent specified in the notice;

Place no further orders or subcontracts for material, services or facilities with respect to suspended work other than to the extent required in the notice;

Promptly make every reasonable effort to obtain suspension upon terms satisfactory to Contractor of all orders, subcontracts and rental agreements to the extent these relate to performance of suspended work;

Continue to protect and maintain the Work including those portions on which work has been suspended; and

Take any other reasonable steps to minimize costs associated with such suspension.

Upon receipt of notice to resume suspended work, Subcontractor shall immediately resume performance under this Subcontract to the extent required in the notice.
The extra cost incurred by Subcontractor in giving effect to Contractor's instructions under this General Condition shall be borne and paid by Contractor unless such suspension is:

Otherwise provided for in the Subcontract or

Necessary by reason of default on the part of Subcontractor.
Provided that Subcontractor shall not be entitled to recover any such extra cost unless it gives written notice of its intention to claim to Contractor within ten (10) days of Contractor's order. Contractor shall settle and determine such extra payment and / or extension of time to be made to Subcontractor in respect of such claim as shall by mutual agreement be fair and reasonable.
If Subcontractor intends to assert a claim for equitable adjustment under this clause, it must pursuant to the General Condition titled "Changes" and within ten (10) calendar days after receipt of notice to resume work, submit the required written notification of claim and within twenty (20) calendar days thereafter its written proposal setting forth the impact of such claim.
If the progress of Work or any part thereof is suspended on the written order of Contractor and if permission to resume work is not given by Contractor within a period of ninety (90) days from the date of suspension then unless such suspension is otherwise provided for in the Subcontract or necessary by reason of default on the part of Subcontractor, Subcontractor may serve a written notice on Contractor requiring permission within twenty eight (28) days from the receipt thereof to proceed with Work or that part thereof in regard to which progress is suspended and if such permission is not granted within that time, Subcontractor by a further written notice so served may, but is not bound to, elect to treat the suspension where if affects part only of Work as a lawful termination by Contractor of such part under the General Condition titled Optional Termination hereof or where it affects the whole Work as termination of the Subcontract by Contractor.

GC-41 Termination For Default

Notwithstanding any other provisions of this Subcontract, Subcontractor shall be considered in default of its contractual obligations under this Subcontract if it:

Performs work which fails to conform to the requirements of this Subcontract;

Fails to make progress so as to endanger performance of this Subcontract;

Abandons or refuses to proceed with any of the Work including modifications directed pursuant to the General Condition titled "Changes;"

Fails to fulfill or comply with any of the terms of this Subcontract;

Engages in behavior that is dishonest, fraudulent or constitutes a conflict of interest with Subcontractor's obligations under this Subcontract or if

Subcontractor becomes insolvent or makes a general assignment for the benefit of creditors or reasonable grounds for insecurity arise with respect to Subcontractor's performance.
Upon the occurrence of any of the foregoing, Contractor shall notify Subcontractor in writing of the nature of the failure and of Contractor's intention to terminate the Subcontract for default. If Subcontractor does not cure such failure within forty-eight (48) hours from receipt of notification or sooner if safety is involved or fails to provide satisfactory evidence that such default shall be corrected within a reasonable time, Contractor may, by written notice to Subcontractor and without notice to Subcontractor's sureties if any, terminate in whole or in part Subcontractor's right to proceed with the Work following which Contractor may prosecute the Work to completion by another Subcontract or by any other method deemed expedient. Contractor may take possession of and utilize any data, designs, licenses, equipment, materials, plant, tools and property of any kind furnished by terminated Subcontractor considering these necessary to complete the Work.
Subcontractor and its sureties if any, shall be liable for all costs in excess of the Subcontract price for such terminated work reasonably and necessarily incurred in the completion of the Work including cost of administration of any purchase order or Subcontract awarded to others for completion.
Contractor shall not be required to obtain competitive tenders for completing such work but may make such arrangements as in Contractor’s judgement shall best accomplish timely completion.
Upon termination for default Subcontractor shall:

Immediately discontinue work on the date and to the extent specified in the notice and place no further purchase orders or subcontracts to the extent that they relate to the performance of the terminated work;

Inventory, maintain and turn over to Contractor all data, designs, licenses, equipment, materials, plant, tools, and property furnished by Subcontractor or provided by Contractor for performance of the terminated work;

Promptly obtain cancellation upon terms satisfactory to Contractor of all purchase orders, subcontracts, rentals or any other agreements existing for performance of the terminated work or assign those agreements as directed by Contractor;

Cooperate with Contractor in the transfer of data, designs, licenses, information and disposition of work in progress so as to mitigate damages;

Comply with other reasonable requests from Contractor regarding the terminated work and

Continue to perform in accordance with all of the terms and conditions of this Subcontract such portion of the Work that is not terminated.
If, after termination pursuant to this clause, it is determined for any reason that Subcontractor was not in default, the rights and obligations of the parties shall be the same as if the notice of termination had been issued pursuant to the General Condition titled “Optional Termination”.

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