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NEC ECC: Revising the programme
The Contractor sets off under an Option C target cost with incentivised fee on a demolition project under which they had design responsibility. The Completion Date was agreed as Nov '18.
Their methodology alters dramatically as they approach design completion as their chosen method is shown not to work.
No clause 32 revised programme was ever submitted.
The Contract was amended by agreement removing the target cost and introducing a fixed fee payable on milestone completion. Seen to alleviate the situation at the time.
The revised Contract conditions state "an integrated programme will be collaboratively developed by the Contractor & the PM and is then submitted by the Contractor to the PM for acceptance in accordance with clause 31.3".
The Contractor does not want to submit his programme as a revised clause 31, instead opting to submit it as a clause 32. That means he doesn't want the Completion Date to move from Nov '18 to what is now proposed as planned Completion of Dec '20.
There are no LD's
Milestones will be re-set on the revised programme when accepted allowing the Contractor to earn his fee - this was contemplated by the Contract amendment.
There is no target cost
There are no significant delays other than the initial delay when methodology changed but that was two years ago and is wrapped up in the amended conditions.
What are the consequences for both Contractor and Employer? This amounts to a negative terminal float position, most unusual. Also surely the Contractor is in breach of the revised/amended conditions.
Apr 21, 2017
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It is not clear from your comments as to whether or not there was a clause 31 programme. Based on the statement of “a revised clause 31” it would seem that a clause 31 had been submitted. If that is the case then any further submissions will be under the provisions of clause 32.
The submission (and agreement) of clause 31/32 programmes does not effect the Completion Date. Unless the matter is a compensation event then the programme would show planned Completion as December 2020 against a Completion Date of November 2018.
The Employer’s rights in respect of the Contract being late (when he does become late) would depend upon whether secondary option X7 is used or not.
If the Completion Date has been changed as part of the Contract amendment then that is the date that should be shown on the programme.
Whatever the Completion Date is, it is important to get an accepted programme in order to be able to manage any changes that may occur.
Apr 21, 2017
Yes (apologies) there was a submitted and accepted clause 31 programme at the start. When we subsequently amended the Contract that "revised" clause 31 programme statement (clause 31.3 that I mention above) was part of those amended conditions. So if they don't re-submit a clause 31 programme then there will be 2 years of negative terminal float. Clause X 7 does not apply under the Contract so it would appear that there is no material effect with this situation and maybe it doesn't matter whether the awaited revised programme is submitted as a revised clause 31 or just a straight revised clause 32.
Apr 25, 2017
thanks for the clarification. The Contractor is right in that the programme should be considered as an updated clause 32 programme. Clause 31.3 deals with the acceptance of programmes whether cl 31 or 32.
If a revised Completion Date was part of the agreement then this should/must be shown on the programme. If a revised Completion Date was not part of the agreement and the matter was not a CE then the Completion Date would remain as November 2018.
If Option X7 is not part of the contract and the Completion Date has not been revised, then the Contractor is at risk of LDs being at large (general damages with no cap) when he becomes late. This is a material effect!!
The real issue is not what clause the programme should be submitted under but what the Completion Date is.
Apr 25, 2017
appreciate the comments and it must seem to you that maybe we are in distress! however all is not too bad. I can see how you would respond in such a way when you are remote to the project and clearly I cannot show you the whole amended contract terms however I think I can read between the lines and maybe assume the Employer & Contractor could always come to any other agreement as to whether the Completion Date is re-set or not even going so far as agreeing that the revised planned Completion Date could be the date when the project will formally end. Many thanks
Apr 26, 2017
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