NEC3 ECC: Cost of preparing quotations

NEC3 and NEC4 Contracts Compensation Events
1

Under Option C, can a Contractor included in a compensation event the cost of preparing quotations?

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As there is no specific exclusion on this cost - unlike under options A & B - the answer is most likely ‘Yes’.

However, two linked points to note :

  • you do have to be incurring extra Defined Cost so, for example, if you have a QS who is based full time in the Working Areas and is not paid any extra as a result of the CE, then there is no “effect of the compensation” (quoting clause 63.1) on Defined Cost.
  • one lawyer has put forward the argument that you could charge for the ‘opportunity cost’ if, for example, the QS would have been doing something else. By opportunity cost, I mean the cost of the QS, not the lost ‘value added’ that the QS would have gained from working elsewhere. This lawyer does seem to be out on his own though and, IF this is the case, the opportunity cost would need to be demonstrated. So if the QS had ben booked full time to that contract, when else would he have been doing work on other projects ?