Can rates and lump sums be used to assess a compensation event instead of Defined Cost?
Under options B & D, the last sentence of clause 63.13 allows rates and lump sums to be used to assess a compensation event instead of Defined Cost providing both the Project Manager and Contractor agree.
Under option A, clause 63.14 also allows the two people to use any rates and lump sums to assess a compensation event providing both agree. Often, these rates may be of non-contractual nature in terms of the contract between the Employer and Contractor. However, they could be between the Contractor and a Subcontractor etc. . Using this provision is a common sense way to agree, wholly or partly, the effect of a compensation event on the Prices avoiding excessive time to build up rates from scratch. For it to work, the party putting forward the rate needs to be 'reasonable' in what they put forward and the other party should avoid the temptation to excessively push it down.