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NEC ECC: Costs of assessing change(s) under NEC3 permitted ?

0 votes
After receiving a significant amount of additional documentation from the client through various PMI's and addendums, the employer provided a register consolidating all the contract works information, site information & PMI data, along with access to the additional documentation, and instructed the following: -

‘In order to bring all of our Consultants and Sub-contractors into alignment on these documents you are instructed to incorporate them into the Works and Site Information against your appointment.'

The Sub-Contractor provided a quotation for the assessment of design implications and the alignment of works & site information.

As per the employers response: -  

'For clarity (-removed-) do not accept the quotation provided for the cost of assessing the change as this is not permitted under the NEC3 contracts.'

Reference made to NEC3 clauses - 63.1 & 11.2

Is the employer's statement correct?
asked May 24, 2019 in Compensation Events by SLH28 (160 points)  

1 Answer

+2 votes
Best answer
I am assuming that this is an option A or B contract, but do correct me if mistaken.

In brief, it is "the cost of PREPARING the quotation" that is not allowed to be included in the quotation. That is different from ADDITIONAL management cost required to do the work.

So taking a literal approach, the cost of assessing the design implications and aligning the WI and SI is allowable (planning is part of doing the work), but filling out the Excel spreadsheet for the quotation is not. Several legal texts confirm this view.

I should that the reason I put 'ADDITIONAL' in capital letters is because there has to be a change in Defined Costs as per clause 63.1, not some additional work done by the same management people who do not get paid extra for doing it.
answered May 26, 2019 by Jon Broome Panel Member (64,190 points)  
selected May 29, 2019 by SLH28