When a Contractor submits his interim Payment Application under, say a JCT SBC/XQ 2016, to which date is his works valued to?
Is it the relevant due date or is it the Interim Valuation Date?
I feel it is IVD based on the wording under 4.14 Gross Valuation.
4.10.1 - Contractor submits Payment Application not later than IVD. Stating the sum that he considers due to him at the relevant due date. The Payment Application is valued in accordance with 4.14.
4.14 - The Gross Valuation for each interim payment shall be …, each calculated as at the IVD.
Therefore, my reading it that the sum the Contractor should consider due to him at the relevant due date is his interim payment application calculated based on the Gross Valuation with a cut off date of the IVD???
My above thinking applies to both the JCT and NEC3 as PM assess up to the assessment date and the due date is 7 days after this (Y2.2)
Under JCT the works are valued as at the Interim Valuation Date, as stated at clause 4.14.
Although it may seem to be a little confusing, clause 4.10.1 is essentially about a payment application, which would be valued in accordance with 4.14 and may be used as a payment notice in the absence of a payment certificate.
The ‘due date’ is effectively .a ‘trigger date’ for consequential payment related actions and obligations, not least the entitlement to be paid the amount of the effective ‘payment notice’ by the final date for payment, unless a valid notice to pay less than the notified sum (payless notice) is given.
Under NEC3 the payment assessment date is comparable to the JCT Interim Valuation Date, with the ‘due date’ occurring 7 days after these.
Under NEC, however, the payment amount is determined by the definition of Price for Work Done to Date (PWDD) which differs depending upon which main option is chosen. Under ECC and ECS, with Options A and B the assessed amount would be as at the payment assessment date, however under options C, D and E this would include a forecast of amounts paid up to the following payment assessment date, with the aim of achieving a neutral cash flow.
That confirms my assumptions on how both contracts operate.
Thanks