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NEC ECC: Incorporating an extra over cost identified at tender into the contract pricing

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In final negotiations at tender stage, a potential change to the WI has been identified and the preferred Contractor has submitted an acceptable cost for carrying out those works should they be required.

Using Option A with Activity Schedule, how best to allow for such an event within the contract data, WI and activity schedule?

Further, what if the extent of those works turn out to involve more work (and cost) to the Contractor or conversely less work (and cost)?
asked Apr 14 in General by nec newbie (190 points)  

1 Answer

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There are several approaches to this but my suggestion (based on you having not yet entered into contract) would be to introduce a Z clause to capture the change in the Prices should the potential change be instructed. The clause would also need to confirm the change in Completion Date should the work be instructed.

The Z clause will need careful drafting and you will need to cover the time by which the change needs to be instructed for the agreed change in Prices & Completion Date to be “valid” and precisely what the change in WI would be in order that any further change to the revised WI can be assessed.  If the works turn out to involve more or less work then that would be the Contractor’s risk provided that the change had been instructed in line with the agreement.

I would also suggest that if the change is going to be required you should instruct it asap so that it does not get entwined with other change.
answered Apr 15 by dave bates (13,250 points)