NEC3 ECC: Management of Utilities and associated risk?

NEC3 and NEC4 Contracts Risk and Insurance
1

The Contractor within the WI, is responsible for “regular liaison, programming, co ordination and management of Utility owners with regards to commissioning and decommissioning of new and old services” . To what extent would you say this transfers risk to the Contractor?

1 Like
2

Has there been any change to Clause 60.1(5) through Z clauses?

3

Firstly, it has to be said that these are pretty high level / vague responsibilities. For instance :

  • What is ‘regular’ ? It could be every 6 months over a 3 year contract ? Or monthly on a six month one ? Or … ?
  • What is ‘management of’ ? I would say it includes liaison, programming & co-ordination. What else PRECISELY ?

So the first point to make is that as these are pretty vague responsibilities, they invite argument over what they mean. So notify an early warning, have a risk reduction meeting and the PM almost certainly needs to clarify what is meant by instructing a change to the Works Information. That is a compensation event and then you can have an argument under 63.8 about the minimum level of what you should have priced for and are now (hopefully) clear about what you should be doing and, under clause 63.6, the residual risk that you are entitled to price for.

My view is then this : if the Utilities do not perform then it can be a compensation event under 60.1 (5) i.e. an ‘Other’ doesn’t do what they should do in the Works Information, doesn’t work within times shown on the Accepted Programme or doesn’t carry out the work stated in the Works Information. And providing the Contractor has done their responsibilities as now defined clearly in the Works Information, then an ‘Others’ default does not arise from the Contractor’s fault, so the Contractor gets an assessment as per section 63 without any deductions etc.

If the Contractor has not quite done everything that they should have done, but has done most of it, then a judgement has to be made in terms of what elements of the utilities default ‘arise from the fault of the Contractor’ and what would have happened regardless.