Was any consideration given to the ECSC having a reimbursable option? Much of the work my company do is under a framework and needs to be responsive to emergency works. Having agreed levels of fee and rates (that are used as Defined Cost), would it be easy to modify the contract to work like Option E of its big brother?
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NEC3 ECSC: Can I modify to an ECC?
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NEC3 ECC: Termination for convenience
The Contract has a 'Z' clause titled Termination for Convenience which states "The Employer may terminate the contract at any time for a reason not stated in the Contract (Termination for Convenience) by giving notice in accordance with clause 90.1".
Do you think this could be seen as an unfair clause that could be challenged in court by a Contractor or is it simply that it is a clause included in a contract which the Contractor has signed up to and is legally bound by no matter how it could be implemented by the Employer? A good example of why termination for convenience would be used in this case is that following request and submission of the Contractor's revised programme and price going forward, further to scope change and to take the contract into its second phase, that submission is deemed to be significantly over stated with little or no hope in agreeing any reduction so a sensible target price and incentive mechanism can be re-set.
Appreciate it's hard to decide without all the facts so I've given as much relevant information as I can but could provide more if you have other questions.
Do you think this could be seen as an unfair clause that could be challenged in court by a Contractor or is it simply that it is a clause included in a contract which the Contractor has signed up to and is legally bound by no matter how it could be implemented by the Employer? A good example of why termination for convenience would be used in this case is that following request and submission of the Contractor's revised programme and price going forward, further to scope change and to take the contract into its second phase, that submission is deemed to be significantly over stated with little or no hope in agreeing any reduction so a sensible target price and incentive mechanism can be re-set.
Appreciate it's hard to decide without all the facts so I've given as much relevant information as I can but could provide more if you have other questions.
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NEC3 ECC: Termination but retain Subcontractors Equipment
I wish to terminate with my main Contractor but complete the works using their current subcontractor and the subcontractors Equipment. Is this possible under NEC3.
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NEC3 ECC: How long after termination does the Project Manager certify a final payment to or from the Contractor on Short Subcontract ?
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Answered: NEC3 ECC: How is Time Risk Allowance Progressed
Gordan - you progress the programme as normal, and if the item that has not needed the TRA is on the critical path the planned Completion will come forward - in your example by five days. This will create five days worth of "terminal float" which the Contractor owns and will be retained in the assessment of any compensation event (clause 63.3). If that activity was not on the critical path, then the early finish by five days would create "total float" which is shared by both Parties (who ever needs it or gets to it first).
There are several other useful posts about "terminal float" and "time risk allowance" if you have a search within this platform.
There are several other useful posts about "terminal float" and "time risk allowance" if you have a search within this platform.
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NEC3 ECC: Assessment of a Compensation Event under NEC3 Short Form
We are currently in dispute with the Contractor regarding how a CE should be assessed under the NEC3 Short Form. The client has insisted on a Bill of Quantities being included . We have instructed the omission of an item under 60.1.1 which omits an element of the work. The QS views this as a simple re-measurement under 63.1 whilst the Contractor insists this should be assessed under 63.2 due to the his work sequence/ methodology being affected. How should this be assessed?
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Answered: NEC3 ECC: The PM has insisted on a specific supplier for an item affected by the exchange rate - is this additional cost recoverable? Option B
Clause 55.1 in the ECC states "Information in the Bill of Quantities is not Works Information or Site Information". Therefore if the name of the supplier is only stated in the BoQ and not in WI then are not constrained to use the stated supplier and if the PM wants to impose that constraint on you he / she would need to issue an instruction stating this. The instruction would then be a 60.1(1) compensation event.
The mechanism for resolving the issue is clause 17.1 as there is an inconsistency between the documents which are part of the contract which the PM resolves by issuing the instruction. When it comes to assessing the compensation event clause 63.8 will be applied i.e. it should be assessed as though there hadn't been a constraint originally as the Employer prepared the Works Information not you, this is called contra preferentum in law.
The mechanism for resolving the issue is clause 17.1 as there is an inconsistency between the documents which are part of the contract which the PM resolves by issuing the instruction. When it comes to assessing the compensation event clause 63.8 will be applied i.e. it should be assessed as though there hadn't been a constraint originally as the Employer prepared the Works Information not you, this is called contra preferentum in law.
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Answered: NEC3 ECC: Notifications are communicated separately. What about other communications?
I would say that it is quite a good idea although not necessarily strictly a contractual requirement to do so. You cant deny every communication that is not communicated separately but certainly practically speaking instructions should definitely be treated as being required separately and should be added to clause 13.7 in future revisions of the contract. Acceptances would be close behind as probably also making sense to be separate.
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Answered: NEC3 ECC: Can PM instruct that all communications which the Contract requires be communicated separately as with notifications?
Works Information could have made it clear that it had to be a separate submission. I have no idea why the Contractor would not want to submit those separately. You can instruct as the Project Manager that you require these separately and I would struggle to see how they could turn this into a compensation event. Just make it clear what you expect in order to review and accept these submissions - which in turn will surely help the Contractors programme?
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Answered: NEC3 ECC: Assessment of a Compensation Event under NEC3 Short Form
It is not for the Contractor to insist how it is assessed. It is for the Contractor and Employer to assess it in accordance with the contract. 63.1 would appear to be pretty clear - if a CE only affects the quantities of work shown in the Price List, the change to the Prices is assessed by adjusting the appropriate changed quantities of work by the appropriate rates in the Price List. Anything else would be assessed using Defined Cost outlined in 63.2. It should be a relatively clear definitive test as to whether it fits 63.1 or not, and if not it is 63.2.
Ultimately if you believe the Contractor has assessed incorrectly by following 63.2 then you as the Employer can assess it yourself (under clause 62.5) in accordance with the contract i.e. using 63.1.
Ultimately if you believe the Contractor has assessed incorrectly by following 63.2 then you as the Employer can assess it yourself (under clause 62.5) in accordance with the contract i.e. using 63.1.
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Answered: NEC3 ECC: Termination but retain Subcontractors Equipment
If you terminate the contract for reason P2 then you can instruct the Contractor to leave the Site and assign the benefit of any subcontract or other contract related to performance of this contract to the Employer. The guidance notes elaborate by stating that the "Employer’s right to enforce assignment of the benefits of a subcontract will be subject to the terms of the subcontract. In certain cases, a new contract (novation) may be necessary."
One to go through with your lawyer as to the mechanics of how to do this.
One to go through with your lawyer as to the mechanics of how to do this.
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Answered: NEC3 ECC: Termination for convenience
Not really sure why this even needs a Z clause as under clause 90.2 the Employer can always terminate for any reason (whilst the Contractor can only do it for a reason stated in the contract). Therefore no I would not consider this to be an unfair clause.
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Answered: NEC3 ECSC: Can I modify to an ECC?
Not without quite a few amendments - which will bring it in line with option E but then again by far the easiest way to do that would be to use option E! Rightly or wrongly making a short contract a reimbursable one will not be the straight forward contract the short contracts intended.
Not impossible though I am sure (especially where there is a will by both Parties for this to happen)
Not impossible though I am sure (especially where there is a will by both Parties for this to happen)
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NEC3 ECC: Does anyone know of the change history between the ECSC 2005 and 2013?
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NEC3 ECC: Can two persons be named as Supervisor and be given delegated powers by the PM?
The remote named PM wishes to delegate most of his powers to two representatives on site. One being a person undertaking the Supervisor role and the other acting, for want of a better term, as say assistant PM.
Of course there is no such role of assistant PM under the contract but that person requires delegated powers hence the question.
Of course there is no such role of assistant PM under the contract but that person requires delegated powers hence the question.
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NEC3 ECC: Assessment of CE's Option B
Thanks for taking time to reply to me it's greatly appreciated, you are correct the drawings are part of the works information. I've told out client that I wish to price each CE as an individual item under clause 60.4 as they have increased more than 0.5% for an example we have a bill rate for gully's with known connections within the new drawings we have additional gully's with unknown connections I have priced these up using CDP2 some are retrospective using actual time and resources and some have yet to be completed and have been predicted. All of the changes are going on to the updated programme and being forwarded to the client.
The problem I now have is our client is saying he can value the additional items under 63.13 using Bill Rates can he do this.
The problem I now have is our client is saying he can value the additional items under 63.13 using Bill Rates can he do this.
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NEC3 ECC: Does the PM pay for a defect repair on sub-contracted work?
Does the PM pay the Main Contractor for the repair of a defect when the work was carried out by a sub-contractor? i.e. am I correct in my view that the cost of correcting the defect would be deemed to be included in the Fee of the sub-contracted work - and would be clear profit for the Main Contractor.
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NEC3 SC: Design Liability under a Supply Contract?
Under a supply contract the purchaser has provided drawings to the supplier. Under the supply contract the purchaser has an obligation to review and 'approve' drawings. The supplier is disputing that the purchaser's role is merely advisory with what appears to be an attempt to relieve itself of any design responsibility. Surely however, the supplier must provide his product with a design that is fit for purpose and in accordance with the goods information and even if it is not in accordance with the goods information then the responsibility is with the supplier? Is there not an implied term under the sale of goods act in this regard?
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NEC3 ECC: Early warning raised, event then becomes a problem, several weeks later you notify a CE. When do you assess it from? We are now in month 6 and the last Accepted Programme was month 5.
If an early warning gets notified in say month 1, month 2 the issue raised becomes a problem, but it did not get raised until month 5 that the Contractor actually formally notified of this being a compensation event. When should the effects of the CE be assessed from (if at all?)
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Answered: NEC3 ECC: Assessment of CE's Option B
Pete
Apologises but I have not seen the previous discussions on this matter.
You say that you are pricing the CE under clause 60.4 which is confusing me. This clause provides for a CE should the quantity of work for a bill item vary to that stated in the BoQ to such an extent that the unit cost changes and the final quantity at the bill rate is greater than 0.5% of the Prices at the Contract Date (tender sum). The clause does not deal with work introduced by a CE.
Your comments appear to be in relation to new instructed work (albeit it may be similar to work in the original Works Information and BoQ). In that case you are at liberty to base the quotations on Defined Cost + Fee or by agreement you can use bill rates. Should you use bill rates then you will not be able to rely on 60.4 for any adjustments
The PM can only value the change(s) using bill rates with your agreement.
Please note the above is based on standard NEC and you may have Z clauses that introduce amendments.
Apologises but I have not seen the previous discussions on this matter.
You say that you are pricing the CE under clause 60.4 which is confusing me. This clause provides for a CE should the quantity of work for a bill item vary to that stated in the BoQ to such an extent that the unit cost changes and the final quantity at the bill rate is greater than 0.5% of the Prices at the Contract Date (tender sum). The clause does not deal with work introduced by a CE.
Your comments appear to be in relation to new instructed work (albeit it may be similar to work in the original Works Information and BoQ). In that case you are at liberty to base the quotations on Defined Cost + Fee or by agreement you can use bill rates. Should you use bill rates then you will not be able to rely on 60.4 for any adjustments
The PM can only value the change(s) using bill rates with your agreement.
Please note the above is based on standard NEC and you may have Z clauses that introduce amendments.
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