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NEC ECC: Conflict between NEC3 Option C clauses 61.1 and 61.3 - PM and Contractor CEs?

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NEC3 ECC Option C.

The PM is suggesting that as there is a stated requirement for the PM to issue a CE following a PM instruction under 61.1, it is not for the Contractor to issue a CE if the PM has not. If the PM has not issued a CE following an instruction he must correct this error by issuing a CE or be in breach of contract.  Clause 61.3 is in error as it mentions that there is no time bar for the Contractor to raise a CE in this instance but due to 61.1 this instance should not have occurred and if it does, it is for the PM to correct it by raising a CE. Clause 61.1 should take precedence over 61.3.

The above is the PM's view, a different view is that despite 61.1, following a PM instruction, the Contractor should raise a CE if the PM has not and there is no time bar to this.

Please confirm the correct interpretation.
asked May 18 in Compensation Events by RG (120 points)  

1 Answer

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Clause 61.1 states that for an instruction changing the Works Information (or Scope under NEC4) the PM should state that a) it is a compensation event and b) request a quotation.

Clause 61.3 states that the Contractor can notify that they can notify a CE if they believe it to be one (i.e. for a reason under 60.1) and that it is not one the PM has notified. So at any stage, the Contractor can notify a CE even if it is one that the PM is "obliged" to notify but haven't. Otherwise the contract would fall over where the Contractor is waiting for them to notify and they simply don't.

Also there may be a situation where the PM instructs "move position of manhole", but from the PM 's position it is still the same manhole so should not cost any more money, but they want it in a different place. If the Contractor knows that the new location will be more problematic from a temporary works position and would be more expensive, the PM can instruct the new position but NOT say it is a CE. Under clause 61.3 the Contractor can then notify why the new location will lead to additional cost and hence is a compensation event, and the PM will have to respond to the CE notification as to whether they accept it is, or to state why they reject the CE notification.    

There is no timebar on when the Contractor can notify a CE for a situation for which the PM is responsible - which incidentally would be for those notified under 60.1/4/7/8/10/15/17. For all other reasons within 60.1, the Contractor would have to notify within 8 weeks otherwise they would be time-barred.
answered May 18 by Glenn Hide Panel Member (84,800 points)