NEC3 ECC: Sett off costs for hired plant failures

A sub-contract agreement was put in place to supply labour and plant to undertake the installation of support steel work. however the mechanical plant (mast climber) failed on numerous occasions causing delay and disruption to the Works. The sequence of the programme required other trades to utilise the access equipment to complete their works

The SOCC is clear that a Defined cost is where the items have been used to Provide the Works, and in this instance when the access equipment has failed, does not meet this criteria. how does the contract deal with the abortive costs incurred by other trades following the delay, and contra-charging these to the offending party.

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There are no such thing as “contra charges” or “sett off costs” specifically within the NEC3 contracts. There are however mechanisms you could have put in place such as using Key Dates where if a Contractor fails to meet a certain condition by a certain date then any cost incurred as a result of missing that date can be recovered from the Contractor… However, if you have not used them you can not impose them mid-project.

Your remedy against the Contractor is what ever your contract says, and no more. If they are late in achieving Completion Date, Sectional Completions or Key Dates then you have some remedy, but otherwise no other remedy.

As to whether you can disallow the cost for the failed equipment - you need to look at the reasons very carefully (particularly if you have amendments) as to whether this cost is dis-allowed or not.