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NEC ECC: Should the Employer pay for defective works?

+1 vote
Under NEC3 ECC Option A contract Cl. 11.2 (27) "The Price for Work Done to Date is the total of the Prices for
•    each group of completed activities and
•    each completed activity which is not in a group.

A completed activity is one which is without Defects which would either delay or be covered by immediately following work."

A Contractor has completed some external works involving surfacing of an area which is proven to be a Defect. The surfaced area will not either delay or be covered by any immediately following work other than some line marking which is a separate activity. The Contractor has completed the line marking. Should they be paid for the surfacing Activity?
asked Dec 3 in Testing and Defects by Client1 (130 points)  

2 Answers

0 votes
Your logic is fine to a point although you concede why shouldn't be paid for the surfacing. By your own admission there is a Defect that will delay immediately following work i.e. if you've got to to relay some of the surfacing this will inevitably delay the line marking works. So no, you shouldn't be paid to my mind.
answered Dec 4 by Neil Earnshaw (18,060 points)  
0 votes
As a general point you do not  need to (and indeed should not) use the payment process to ensure any item is defect free. They are contractually obliged through section 4 to deal with any defects and you have sufficient remedies to make sure they are corrected without simply withholding money. This could also be detrimental if you are withholding money at a point where they need cash flow to finish the works and it could affect their ability to finish by the date you as a client want/need.

If it is a major fundamental defect that means you would not be able to use it as it is then I could understand you not paying for the line item on the activity schedule - which brings up another point. The likely hood is that this would have been broken down into smaller work items rather than "construct road" and it would only ever be the individual line item that this covers that could be withheld.  

Not clear from your question if it is the whole surfacing that is wrong and needs to come up - in which case I would not pay them. If it is patch repairs that need correcting then I would not with hold the payment of the surfacing knowing you have sufficient remedy to get the work corrected.
answered Dec 4 by Glenn Hide (66,350 points)