Key Takeaways
- Calling something a “variation” doesn’t make it one. Whether work is a variation requires an exercise of contractual interpretation, especially under a design-build, lump sum bargain.
- Commercial parties will be held to the terms of the contract they freely agreed to; even if skewed heavily against them. Parties should get legal advice on their contracts early to understand their risks. Push back if the risks are unacceptable or live with the consequences.
- FIDIC 1999 Sub-Clause 20.1 is a true condition precedent. Miss the 28-day notice, and the contractor’s entitlement to additional payment is extinguished entirely.
- Termination doesn’t resuscitate time-barred claims. Contractual notice obligations and accrued consequences remain effective despite termination. Termination operates prospectively; it does not wipe out notice obligations.
- Waiver/estoppel cannot be an afterthought. If a party wants to rely on arguments of unfairness or that the other party waived strict compliance, there must be contemporaneous evidence of representation, reliance, and detriment, and it must be pleaded.
- The FIDIC Engineer cannot waive your notice requirements. The FIDIC Engineer cannot amend the contract or relieve notice obligations; that has to be done by the opposing party.
The case
The Board of the Judicial Committee of the Privy Council’s (the “Privy Council” or the “Board”) decision in Uniform Building Contractors Ltd v The Water and Sewerage Authority of Trinidad and Tobago, [2026] UKPC 2 (January 22, 2026), is an important decision on the interpretation of construction contracts generally and FIDIC contracts particularly. Though the decision is not binding outside of jurisdictions for which the Privy Council is the highest court of appeal, courts and arbitrators around the world may follow its guidance.
WASA (the public water authority in Trinidad and Tobago) contracted with Uniform Building Contractors Ltd (“UBC”) in 2007 for a design, supply, and installation pipeline project. The contract incorporated FIDIC Design-Build (“Yellow Book”) general conditions and bespoke particular conditions, and the prices were lump sum.
Disputes followed, and WASA terminated UBC in 2009.
UBC sued in 2013 seeking about TT$13.9 million (CA$2.8 million) for four items of work: laying pipework in the roadway (as opposed to the verges), removal of unsuitable backfill, importation of backfill, and night work. UBC framed its claim as payment for four alleged “variations” said to have been instructed on site by the FIDIC Engineer (who is an independent consultant/contract administrator). Yet UBC did not follow the variation procedure or give notice of claim.
At trial, UBC lost. The High Court held that UBC should be held to the terms of the FIDIC contract and considered the fixed price of the contract to account for the circumstances which occurred during the project. The Court of Appeal reversed that decision and awarded UBC the TT$13.9M, leaning heavily on the FIDIC Engineer’s evidence that the items of work were variations and its evidence about how the contract was “actually operated” on site, concluding that contractual notice requirements had effectively been “waived.”
The Privy Council allowed WASA’s appeal, reversed the Court of Appeal, and dismissed UBC’s claim.
The decision
1) “Variations” are what the contract says they are, not the Engineer
The Privy Council emphasized a point that construction lawyers know but project teams sometimes forget in the heat of delivery: a “variation” is whatever the contract says it is, not whatever someone on site later describes it to be.
Here, the contract defined “Variation” by reference to changes instructed/approved under clause 13, and the Privy Council concluded that none of the four disputed items met the definition because (i) the broader contract risk allocation in the FIDIC general conditions and the particular conditions required UBC to price comprehensively, and (ii) the specific documents and specifications expressly contemplated the kinds of work UBC later claimed were extra.
Critically, this was despite the FIDIC Engineer himself giving evidence that he approved the additional works with the payments to be made later, and he agreed they were variations.
The Privy Council’s analysis is steeped in the commercial logic of the lump sum design-build deal. If the work is expressly or impliedly included in what the contractor promised to deliver for the lump sum, it is not miraculously converted into a payable extra because it turned out to be more costly than anticipated. The contractor cannot escape the contract into which it freely entered.
2) Even if they were variations, notice was required
The Board went further. Even if the disputed items could have been treated as variations, UBC still faced fatal procedural problems.
If the FIDIC Engineer had instructed UBC to carry out a variation, the next step in the process would have been for UBC to seek a determination from the FIDIC Engineer under clause 3.5 on the value of the extra work. The determination by the FIDIC Engineer is what gives rise to an entitlement to be paid additional monies. UBC failed to follow the contractual procedure and so was not entitled to payment.
Further, had UBC requested a determination, but the FIDIC Engineer failed to give one or UBC disagreed with it, FIDIC Sub-Clause 20.1 required the Contractor to give notice of a claim within 28 days or it “shall not be entitled” to additional payment and the Employer is discharged from liability.
The Board treated the FIDIC contract language as classic condition-precedent drafting: “no notice, no claim.”
3) Termination does not revive what the time bar already killed
The Court of Appeal treated termination as a reason why Sub-Clause 20.1 did not apply. The Board rejected that. Termination is generally prospective, and it does not wipe out accrued rights, obligations, and consequences that arose before termination.
In this case, the time to notify had expired long before termination. Termination could not resurrect a claim that had already become unavailable by contract.
4) “Fairness”, waiver, and estoppel cannot be smuggled in on appeal
The Board dealt sharply with the Court of Appeal’s “fairness” approach. If a Contractor wants to avoid the consequences of non-compliance by saying the Employer waived strict rights or is estopped from relying on them, that case must be pleaded, and it must be supported by evidence of representation, reliance, and detriment.
UBC first raised waiver/estoppel in submissions at the Court of Appeal. That was too late.
5) The FIDIC Engineer cannot waive the contractual requirements
Crucially, even if UBC had tried to frame waiver around site-level conduct, FIDIC clause 3.1 constrained the FIDIC Engineer’s authority. The FIDIC Engineer had no authority to amend the contract or relieve either party of contractual obligations. He was not a party to the design-build contract nor was he the Employer’s duly authorized agent, but had a quasi-independent role.
The notion that the FIDIC Engineer can “waive” compliance with the variation/claims machinery (including Sub-Clause 20.1) runs headlong into the contract’s express structure. The FIDIC Engineer administers; the parties bargain.
Why this matters for owners/Employers, contractors, and contract administrators
This decision is a reminder that, in FIDIC projects, notices are not paperwork theatre.
For contractors: if you believe an instruction or circumstance entitles you to time or money, treat the notice requirement as an emergency procedure. Do not be led astray by informal assurances, even if they come from the FIDIC Engineer. If the FIDIC Engineer is unresponsive, the Privy Council pointed out that Sub-Clause 20.1 exists precisely to “unlock” the issue. Use it.
For owners/Employers and FIDIC Engineers: this judgment reinforces that the project’s on-site “we’ll sort it out later” culture can magnify disputes. Bending the rules on site does not rewrite the contract. Eventually, the disputes come back with a vengeance and the contract you have been skirting will apply.
And for everyone: if you intend to rely on waiver/estoppel, plead it early and build the evidentiary foundation. Courts (and appellate courts) are not obliged to rescue a party from its contract on “fairness” alone.
APPENDIX – RELEVANT FIDIC DESIGN-BUILD (YELLOW BOOK) 1999 PROVISIONS
Provisions on Scope
Clause 4.11 of the FIDIC Design-Build (Yellow Book) conditions provide:
“The Contractor shall be deemed to:
(a) have satisfied himself as to the correctness and sufficiency of the Accepted Contract Amount, and
(b) have based the Accepted Contract Amount on the data, interpretations, necessary information, inspections, examinations and satisfaction as to all relevant matters referred to in Sub-Clause 4.10 [Site Data] and any further data relevant to the Contractor’s design.
Unless otherwise stated in the Contract, the Accepted Contract Amount covers all the Contractor’s obligations under the Contract (including those under Provisional Sums, if any) and all things necessary for the proper design, execution and completion of the Works and the remedying of any defects.”
Variations
FIDIC contract dealing with variations include as follows:
“1.1.6.9 "Variation” means any change to the Employer's Requirements or the Works, which is instructed or approved as a Variation under Clause 13 [Variations and Adjustments].
“13.1 Right to Vary
Variations may be initiated by the Engineer at any time prior to issuing the Taking-Over Certificate for the Works, either by an instruction or a request for the Contractor to submit a proposal.
…
13.3 Variation Procedure
…
Upon instructing or approving a Variation, the Engineer shall proceed in accordance with Sub-Clause 3.5 [Determinations] to agree to determine adjustments to the Contract Price and the Schedule of Payments. These adjustments shall include reasonable profit, and shall take account of the Contractor’s submissions under Sub-Clause 13.2 [Value Engineering] if applicable.”
“3.5 Determinations
Whenever these Conditions provide that the Engineer shall proceed in accordance with this Sub-Clause 3.5 to agree or determine any matter, the Engineer shall consult with each Party in an endeavour to reach agreement. If agreement is not achieved, the Engineer shall make a fair determination in accordance with the Contract, taking due regard of all relevant circumstances.
The Engineer shall give notice to both Parties of each agreement or determination, with supporting particulars. Each Party shall give effect to each agreement or determination unless and until revised under Clause 20 [Claims, Disputes and Arbitration].”
Contractor’s Obligation to Give Notice of Claim
Clause 20.1 of the FIDIC Yellow Book provides:
“If the Contractor considers himself to be entitled to any extension of the Time for Completion and/or any additional payment…the Contractor shall give notice to the Engineer…as soon as practicable, and not later than 28 days after the Contractor became aware, or should have become aware of the events or circumstances.
If the Contractor fails to give notice of a claim within such period of 28 days, the Time for Completion shall not be extended, the Contractor shall not be entitled to additional payment, and the Employer shall be discharged from all liability in connection with the claim…
…If the Contractor fails to comply with this or another Sub-Clause in relation to any claim, any extension of time and/or additional payment shall take account of the extent (if any) to which the failure has prevented or prejudiced proper investigation of the claim…” (Emphases added)
The Engineer’s Authority
“3.1 Engineer’s Duties and Authority
The Employer shall appoint the Engineer who shall carry out the duties assigned to him in the Contract….
The Engineer shall have no authority to amend the Contract.
The Engineer may exercise the authority attributable to the Engineer as specified in or necessarily to be implied from the Contract….
However, whenever the Engineer exercises a specified authority for which the Employer’s approval is required, then (for the purposes of the Contract) the Employer shall be deemed to have given approval.”