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NEC ECS: Clause 63.2 – reduction of prices

+1 vote
We are  under an NEC3: Engineering and Construction Subcontract (ECS).

The Contractor issued a CE instructing us to use a subcontractor  whose  price  is cheaper than  our  subcontractor's  price at tender.

This will in theory result in reduced price as per clause 63.2 and 63.10.

Is there anything that can be done  to retain our original margin.
asked Sep 30 in NEC3 Compensation Events by anonymous   1 4

1 Answer

+1 vote
First of all, I would challenge whether they can reduce your Prices. They are imposing a further constraint that is forcing you to use this Subsubcontractor, but you could choose to use this Subcontractor off your own bat and the Prices would stay the same.

However, you are presumably choosing to use the other more expensive one because they are reliable etc which de-risks the rest of your contract. Consequently, this additional constraint, you could argue is introducing risk for which you could charge under clause 63.6.

See how the Contractor responds to that !
answered Oct 1 by Jon Broome (25,060 points)