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NEC ECS: Using X18 to limit X7 delay damages?
Included within an NEC3 Option A subcontract agreement, the Subcontract Data under X18 states:
'The Subcontractor’s total liability to the Contractor for delay allowable under this contract is limited to; 10% of the total of the Prices.'
However as delay damages are an excluded matter will X7 delay damages sit outside of the 10% cap?
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Delay damages will be capped at 10% but the amount will not form part of the cap on total liabilities.
X18.4 states that the total liability for all matters other than the excluded matters is limited to the amount stated in the Subcontract Data. As you state, if X7 applies delay damages are an excluded matter.
Delay damages would therefore not be caught in the total liability but because of the additional wording the damages under X7 (themselves) would be capped at 10% of the total of Prices. They would not be accounted for in the total liability.
Prices £10M, liability excluding X7 = £500K, X7 = £600K, total liability limited to £900k (say).
Liability = £500K + £600K = £1.1M
X7 = £1.2M: Liability = £500 + £1M (10% cap) = £1.5M
Liability excluding X7 = £1M, X7 = £500K
Liability = £900K (cap) + £500k = £1.4M
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