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NEC ECC: Do we have to do extra instructed works and how should it be assessed?

+2 votes
If we are asked to quote for supplying & installing new items that were not part of the original contract, can we offer a quotation rather than it be based on defined cost plus mark up? Also do we have to do the work or can we decline?

This is not additional work related to the items we have a contract for, these are new / additional items required due to site design changes. We will offer a quotation but do not wish to be forced to go down the defined cost plus mark up route. Also are we obliged to offer quotation or can we decline quoting.
asked Sep 1, 2017 in NEC3 and NEC4 Contracts by NeilR.  
I would agree with Neil PROVIDING, the nature of the work is within the original scope of what you contracted for i.e. the definition of the 'works' (in italics) as per early on in the Contract Data part 1. Otherwise, you could sign a contract to build a road to a hospital and end up having to build the hospital !

More realistically, I have had a situation where the works were for "the construction of .... " but the design turned out not to be complete. The PM, who happened to be from the same company as the designer, wanted to snuck it in as a compensation event. The Contractor (on my advice for the reason above) refused, the Employer took legal advice and concurred. A supplementary agreement was signed changing the Prices, the definition of the works, adding a secondary option and changing the Works Information rather than it being a compensation event.

1 Answer

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Best answer
Your obligation to do additional work is separated from the your right to recover additional time and money.

Clause 27.3 obliges you to obey an instruction from the Project Manager or Supervisor provided that it is in accordance with the contract, e.g. an instruction from the PM to change the Works Information. Provided this is the case then no you cannot decline to do the additional work.

The time and money you can recover is dealt with under clause 63. Clause 63.1 states Defined Cost plus Fee will be used however there is an exception at clause 63.13 /14 (depending on main Option).  This exception allows rates and prices to be used as the basis of assessment, but only if the PM and Contractor agree to it. So you can't impose this on the PM and the PM can't impose this on you. However if there is no agreement you must use Defined Cost plus Fee.
answered Sep 1, 2017 by Neil Earnshaw (18,510 points)