PUBLIC WORKS

MEASUREMENT, ACCOUNTS AND APPROVALS thereof after law 4782/2021 (f.36) "Modernization, simplification and reform of the regulatory framework for public contracts, more specific regulations..."

 

Alexander P. Roilos

Former Legal Advisor of the State Legal Council

 

A. WORK MEASUREMENT

Measurements refer to the quantities of work performed by a public project. Based on these, the following are drawn up: accounts by the contractor. The measurements are divided into segmental and in final.

1) SECTIONAL MEASUREMENT

During the construction of a public project, all necessary data for measuring the quantities of the work performed are obtained on site, except for cases c to e of paragraph 2 of article 95 of Law 4412/2016, namely when: financial offer is given exclusively as a lump sum, the financial offer is given as an indivisible percentage of the property and the financial offer also includes other considerations, in addition to full cash payment or real estate consideration for the construction and possible operation and maintenance of the project (article 70 of Law 4782/2021).

The measurement data is submitted by the contractor to the supervisors of article 136 of law 4412/2016, with a responsible declaration of their truth. Each measurement is clearly recorded as follows:   conventional quantities from the extra-contractual quantities performed by the contractor by order of the service.

Based on these data at the end of each partial deadline, as defined in contract schedule or if it does not exist, at the end of each month or at another time specified in the contract documents, the contractor shall prepare measurements by distinct parts of the project for the work carried out during the previous scheduled period. The measurement shall include a brief description of the work, with an indication of the corresponding article of invoice or of the new unit price regulation protocols work, drawings, data and diagrams, based on direct measurement data of the works or statements of par. 7 of article 70 of law 4782/2021. The measurements together with all the data and the drawings (in printed and electronic form) are submitted by the contractor to the Service for verification with a declaration of their truthfulness. The submission of the measurements is a prerequisite for installment payment of the contractor. The head of Managing Director Service (DM) may at any time order the total or sample indicative verification of any submitted measurement, but in any case, he is obliged to proceed to an indicative check of the 40% of the submitted measurements or at least four of them, if fewer than ten are submitted. In the event of the submission of an inaccurate or intentionally untrue measurement, the head of the DM orders a full check of all the submitted measurements and the contractor is called upon invitation, in which a deadline is set (it cannot be less than three days and more than ten days) to submit the actual measurement data and provide explanations.  Inaccurate are considered measurements that contain obvious calculation errors or omissions or mention an incorrect invoice item and cannot be attributed to the contractor's intention to defraud the IO. Intentional untrue Measurements are those that intentionally contain false measurement data. Inaccurate or intentionally false measurements are corrected whenever by the DM. The contractor also retains the right to make corrections. The DM's decisions are subject to objection of article 174 of law 4412/2016. In the event of submission of inaccurate or intentionally untrue measurements and if these resulted in the payment of a bill, a penalty is charged to the contractor. negative account for the refund of an unduly paid amount, increased by 3%, as a special penal clause, in cases of intentional false measurements. When the contractor repeatedly submits false measurements, or the deadline specified in the above invitation passes without action, it is declared, by decision of the superior authority, compulsorily dismissed and the following is charged against him: guarantee of good performance. As relapse is considered especially, the submission of at least three false measurements. The decision to deduct is subject to the objection under article 174 of Law 4412/2016. The notification statement hidden tasks, which submits  mandatory the contractor, concerns work performed that will not be possible to verify quantitatively in the final form of the project, such as work that is to be covered by others, quantities received by weighing or the like. The statement, recommends distinct measurement, includes a statement regarding the truth of the data and is signed by both the contractor and the technicians of article 139 of law 4412/2016. The contractor before the covering of the works is obliged to call the supervisor to check these works. The supervisor then draws up  report confirmation of these works and submits it without delay to the head of the DM. The report is necessarily accompanied by sufficient data for the execution of the hidden work. The report that necessarily accompanies the measurement is not enforceable and therefore cannot be challenged independently except together with the approval act of the measurement, issued by the DM within a deadline thirty days from its submission (paragraph 7 of article 70 of law 4782/2021). Failure to check the hidden works within the three-day period from the notification of the contractor's invitation constitutes default of project owner, if it appears that the contractor suffers damage for this reason. The report on receipt of hidden works is only contested together with the approval act of the DM.

Specifically, the characterization and  receipt of natural soil in which the project is performed, are carried out by two or more technicians for greater safety and reliability.

2) FINAL MEASUREMENT

At the latest two months after the confirmed completion of the project, the contractor is obliged to submit to the DM the final measurement (S.t. E 3819/2000). The final measurement is of a summary nature and recapitulates the quantities of all partial measurements and the acceptance protocols for hidden works, and is signed by the contractor and by at least one of the technicians of article 139 of Law 4412/2016.

The final measurement shows separately the contractual and non-contractual works, even if their settlement process is pending. The final measurement is checked by the supervisor, who submits a relevant report to the DM within two months. The DM is obliged to proceed with the control of the final measurement, within two  months from the submission of the supervisor's report (two months) and issue an approval act. If differences appear between individual measurements and the final measurement, the contractor is obliged within a deadline set by the DM (not less than three days) to provide complete and justified proof of the arising difference. In the event that the contractor does not submit the final measurement within two months from the notification to him of the completion certificate, shall be imposed on him for each completed month of delay, special penalty clause (2% of the total amount paid to the contractor up to that point. The penalty clause is imposed by decision of the DM and for six months of delay.

Regardless of the imposition of the penalty clause and after the lapse of the time for its imposition, the final assessment is drawn up by the DM.

The approval The final measurement decision is considered an act of the DM and the contractor, if he does not accept any corrections, may exercise objection and request for treatment. Together with the final measurement, the contractor may submit any other claim related to the construction contract, if it has not been extinguished and the relevant claim is time-barred according to article 173 of Law 4412/2016 or if the relevant right has not been extinguished or lost for some other reason. After the submission of the final measurement, the contractor may only make claims for subsequent causes.

Law 4412/2016 (article 151 par.2) and CASE LAW ON THE AUTOMATIC APPROVAL OF THE MEASUREMENT

          In Law 4412/2016 (Article 151, paragraph 2), which was replaced by Law 4782/2021 (Article 70) it was stipulated that, the D Y within forty-five days from the submission of the measurements by the contractor, had the obligation to check and correct the calculations, approve the measurements and notify the contractor of the measurements that have been checked and corrected. This notification was considered act of the Public Works Department and could be challenged by the contractor with an objection (S. t. E 3485/1994).

The Council of State has consistently accepted (inv. 3819/2000, 1154/2006) that, if the partial measurement submitted by the contractor is not approved by the Managing Service within in reasonable term – and it was considered so the trimester deadline – then it was considered in jure (in law))the submitted measurement is approved. This is in order to resolve definitively and promptly any disputes that arise during the various stages of execution of the public project.

            B. ACCOUNTS

            1) INDIVIDUAL ACCOUNTS

The payment of the contractor's consideration to the contractor (article 71 of Law 4782/2021) is made piecemeal based on the measurements of the work that has been carried out within the limits of the work schedule. The realization of both the partial payments and the final payment of the contractor's consideration, as well as the liquidation of all mutual claims from the construction contract, is done based on the accounts.

If the contractor carries out work beyond that provided for in the schedule, the The project owner has the right to postpone the payment of additional work to coincide with the schedule. This does not apply when the contract provides for additional payment for the faster completion of the project.

After the end of each month or other period of time specified by the contract, for the partial payments, the contractor draws up account of the amounts from work performed. The accounts are based on the measurements of the work and the disclosure statements hidden tasks. It is prohibited to include in the bill works that have not been measured. For the payment of additional or new works, the contractor shall draw up a separate bill after their contractual settlement, in accordance with articles 155, on urgent and unforeseen works and 156 on special issues of contract amendments during their duration, of Law 4412/2016. The bills shall include unfinished business, unless otherwise specified in the contract and following a reasoned approval decision by the DM and if their nature is such that a potential interruption of the project would not destroy the unfinished work, materials brought in with the approval of the service to the construction sites or warehouses, which were declared and approved. For the materials included in the bills, the contractor is responsible until their integration and acceptance of the project. Percentages overheads (OG) and benefit of the contractor (CO), are not counted in the materials.

The accounts include the price revision, compensations of any kind that have been approved, consideration apologetic work executed through the contracting and any other approved expenditure paid to the contractor. Also included is the percentage overheads and contractor benefit of paragraph i of paragraph 7 of article 53 if this is not included in the contractual prices, and the total is reduced by the auction discount percentage, if applicable.

All settled claims of the employer (such as penalty clauses, price cuts under Article 159, additional security deposit, amortization of advances, etc.) and any general claim of the employer that has not been satisfied in any other way are deducted from the accounts.

Accounts are always drawn up recapitulative (AP 1272/2003) and are accompanied in particular by a summary summary table of the measurements of the work carried out since the beginning of the project, documentary evidence of the accounting work, a table of the calculation of the revision and by the decisions that recognize compensation or impose penalty clauses or reductions or other requirements of the employer.

The accounts are submitted to the DM who checks, corrects and approves them. within one month, without proof of payment. If the bill has ambiguities or inaccuracies, the DM, by order to the contractor, points them out and orders the re-compilation and resubmission of.

The above monthly deadline begins upon its resubmission, following re-compilation by the contractor. The supervisor checks and signs the bill. In order to be paid, the contractor must present all the required payment documents. An account that was paid without checking, due to the expiration of the month, or that was based on a measurement that was corrected, is checked and corrected upon its submission or re-submission and the resulting differences are taken into account in a subsequent account or when drawing up a negative account. In the event of a negative account being drawn up in the final account, the amount must be paid within in a month  by the contractor, otherwise letters of guarantee of equal amount will be forfeited against him. An objection is allowed against the negative account.

If the payment of an invoice is delayed through no fault of the contractor, beyond one month from its submission or resubmission, it is due default interest, according to paragraph G of article one of law 4152/2013 (f.107).

The correction and the order for correction constitute enforceable administrative acts, which are challenged through the legal remedies of objection and her  treatment request.

It is forbidden to assignment of the contractor's consideration or its seizure in the hands of the project owner throughout the duration of the project and for one month after completion. Exceptionally , are allowed: a) the assignment at any time, in whole or in part, of the contractor's payable consideration, when it concerns the coverage of the contractor's debt from the supply of materials and machinery for the execution of the project or from the provision of work provided by its workers or employees, in the execution of the project or to recognized banks and other credit institutions or legal entities, and b)  the seizure of the contractor's consideration from the suppliers of materials and machinery for the project or from its workers and employees, as well as subcontractors who are proven to be used in the project by the contractor.

May clearing of the project owner's settled claims against the contractor, arising from the execution of other projects and up to a percentage of 20% from each account of the project being executed.

Payments made to the contractor constitute payments against the contract consideration which is settled upon receipt.

Each payment is made reservations (5%), to the value of the works after the corresponding revision.

 

2) FINAL ACCOUNT

After receipt and approval of the receipt protocol the final invoice is prepared by the contractor and the liquidation of the contractor's consideration. The provisions of article 71 of law 4782/2021 shall apply accordingly to the final bill. With the approval of the final bill, claims from the contractor's contract are settled, except for claims arising from subsequent administrative, conciliation or judicial dispute resolution procedures.

 

 

CASE LAW ON THE AUTOMATIC APPROVAL OF THE ACCOUNT (before the entry into force of Law 4782/2021).

 

The Territorial Council, with its 1434/1999 decision, interpreting the provision of article 7 (par. 1) of Legislative Decree 1266/1972 - prior to the entry into force of Law 1418/1984, the legislative regime on public works - ruled that the Public Works Authority is obliged within a month from the submission of the bill to proceed with its approval, because otherwise, if the above monthly deadline passes without action, the submitted bill is considered approved, and any subsequent approval is formal, which simply confirms the approval of the submitted bill that occurred upon the expiry of the deadline.

The DM can no longer amend the already automatic invoice after the month has passed since the submission of the approved invoice, because if issued without due time, it is illegal and therefore voidable. On the contrary the Supreme Court ruled with its 1272/2003 decision.

The Supreme Specialized Court, removing the doubt created by the above opposing decisions, by 8/2004 Its decision was in favor of the interpretation of the S.t. E, namely the automatic approval of the bill.

Thus, according to case law, if the monthly deadline set for the competent Service from the submission of the account for audit passes without action, that is, if the Service does not approve the account as submitted by express act, nor does it expressly refuse its approval, nor does it proceed with a correction and subsequently approve it, nor, if the correction is difficult, does it return it to the contractor for redrafting and resubmission, the submitted account is considered automatically approved and the project owner must pay the amount indicated therein, regardless of any deficiencies (S.t. E 4025/2010,865/2011).

The Territorial Council (3232/1998) has accepted that, if the one-month deadline has passed and the submitted bill has not been approved, it is considered approved and the competent service cannot approve it later as it is not competent in time.

With the immediately preceding decision, the following were also accepted: Each account has autonomy with respect to the amounts it includes, in the sense that, as long as this act is not disputed, it is finalized, the claims of any nature arising from it are extinguished and it cannot be challenged on the occasion of subsequent accounts. In fact, its autonomy is not negated by the fact that it is drawn up in the form of a summary table.

 

Conclusion

The case law that established the "spontaneous" approval of measurements and accounts was overturned by the regulations of Law 4782/2021.

 

 

Final thoughts

The above provisions of Law 4782/2021 (Articles 70 and 71) - case law on these is eagerly awaited - establish continuous, substantive control over measurements and accounts in public works and avoid payment for work that was not carried out. This control is required for reasons of protection of public money, national or EU.

 

Notes:

1. The above topic, under the legislative regime of 3669/2008 <<Ratification of the codification of public works construction legislation>>, (I was a member of the legislative drafting committee), was developed with my presentation at a conference in Nafplio (Environment - Public Procurement) in 2014.
2. Chairman of the legislative committee of Law 4412/2016 <<Public Contracts, Works, Supplies and Services (adaptation to Directives 2014/24/EU and 2014/25/EU)>>, which was replaced by Law 4782/2021 (deputy Chairman of the legislative committee).
3. Measurements and Accounts, under regulation 3669/2008 in my study PUBLIC WORKS LEGISLATION (pp.39-44), 2013.

 

 

Athens, October 22, 2024