Expert advice in minutes not days. Register it's free and ask your first question now.
ReachBack is a free community help desk for construction professionals run by Built Intelligence. A library of high-quality questions from real users with answers delivered and curated by industry experts.

4,912 questions

5,237 answers

1,011 comments

Register its Free

Download here

NEC ECC: Are durations of Employer’s activities shown in the Contractor 1st Programme for Acceptance submitted as part of Contract Data Part 2 considered as Agreed, and supersede durations stated in the Works Information?

+1 vote
77 views
I’ve recently started on a project that is a couple of months after Contract Award, and have discovered that the Contractor’s Programme submitted with the Contract Data Part 2 does not comply with the Works Information – in particular periods stated by the Employer for activities by the Employer/Others. These “errors” were also present in 2 subsequent Accepted Programme, and are part of the critical path for the Contractor to achieve the Completion Date.
We have recommended that the future programmes are rejected until such time that the “errors” are corrected and the programme is compliant with the Works Information.
The Contractor is arguing that because the Programme was submitted with his Contract Data then the dates & durations shown for Employers / Others activities supersedes the periods set out in the Works Information, even where the durations are unrealistic (eg 0 days for an activity that the Works Information takes 10 says).

So, can we reject the Programme for non-compliance or has the signing of the contract tied the Employer into the dates & durations within the 1st Accepted Programme??


Further, some of these shortened Employer’s activities have already occurred and the Contractor has notified Compensation Events for not providing / working to the dates shown in the Last Accepted Programme.
Our initial response has been rejection of the Compensation Event as the Employer’s activities were completed within the periods stated in the Works Information, and therefore the event has not occurred.
However, under 60.1(3)&(5), the Contractor does appear to have entitlement to compensation.

So, even if the future accepted programmes are altered to comply with the Works Information can we reject the Compensation Event??
asked Mar 1 in Contract Data by KrisWright77 (130 points)  

1 Answer

+1 vote
No - revised durations in programme that have been accepted does NOT change the Works Information. If they have shown one week for Employer design acceptance on the programme but the Works Information says four weeks then if they take four weeks that will NOT be a compensation event. Clause 14.1 explains what liability they are taking on which is basically I am accepting assuming it complies with the Works Information, and if it doesn't that is still Contractor liability if it has been (incorrectly) accepted.

If these activities have already occurred, even if it was a compensation event for not providing something by the date shown in the programme you can assess it on the basis of the time stated in Works Information and assess lower or at zero accordingly.

Having said all that it does beg the question why this was not flagged up before accepting the programme which would have saved a lot of heartache, but never the less it does not mean the Employer is now liable. There would have needed to have been an instruction from the PM changing the Works Information in line with the programme for this to then become a compensation event - which I assume would not have happened!
answered Mar 1 by Glenn Hide (70,150 points)  
Hi Glenn, agree that it does not change the WI but I would expect the assessment of the CE (for not providing something as per the accepted programme) to be based on the difference between actual date and the date on the accepted programme (not WI) particularly if it related to dates shown the programme referenced in CD2.
Dave - I am not sure is we are saying the same thing or not. The question was asking about elements in the past. The point I was trying to make is that if the programme has said one week for (say) design acceptance and they actually took four weeks on an actualised programme and yet Works Information said four weeks then the assessment of a CE (if it has even got that far) would be zero in terms of cost and time.

The Contractor can not be changing things by stealth on the programme and be expecting to rely on that contractually. The rules are there to protect both parties.
As the 1st Programme was submitted with the Contract Data Part 2, it appears that the programme was accepted by the Employer when the Contract was signed.
Clause 14.1 only deals with the Project Manager and Supervisor - so I am still uncertain.
Project Manager would still be giving an instruction to comply with the Employers Works Information so this would not be a compensation event (see exception to an instruction being a CE in 60.1(1)).
Just to add to the discussion, the programme in Contract Data Part 2 is not actually 'accepted' by anybody (Employer or PM) but becomes the Accepted Programme by default (see definition of Defined Term) regardless of whether it is 'compliant' with the contract requirements.  Subsequent programmes are accepted by the PM and, as Glenn has stated, under clause 14.1 any such acceptance of a communication (including a programme) does not change the stated responsibilities under the contract.  Technically this would be a CE under 60.1 (3) or (5) although would be 'caught' by clause 61.4 as it 'arises from a fault of the Contractor' (that is non-compliance with the stated timescales in the WI), so the Prices, Completion Date and Key Dates do not change.
Hi Andrew, I don't think this would be caught by 61.4. I accept that acceptance of the programme does not alter the WI, however the event (if 60.1(5)) is the Employer or Others do not work within the times shown on the Accepted Programme. Whilst the cl 32 programme does not comply with the WI and could therefore have been not accepted by the PM, it has been accepted. There must therefore be an obligation for the Employer and Others to work to it; the acceptance by the PM does not arise from a fault of the Contractor. - its an interesting discussion.
Dave, my thought on this is that the root cause of the CE was that the Contractor had not included the correct timescales, as stated in the WI, therefore, the CE occurred due to a 'fault' by the Contractor.  You could argue that the Employer is at fault for not complying with the timescales in the Accepted Programme, and the PM is also at fault for accepting the programme.  Neither of these would have occurred, however, if the correct timescales were included by the Contractor, so to my mind the root cause is that the programme does not comply with the WI.  The only exception would be where different timescales were agreed with the Employer.