Contractors delays & its affect on Key Dates

NEC3 and NEC4 Contracts Compensation Events
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NEC4 ECC Option A with no Z clauses that affect Cl 3 (Time) or 6 (Compensation Events).

I understand ‘concurrent delays’ is not a term under the NEC form of contract and delays should be assessed in the order that they occur. Some parties may then benefit from the creation of float by the others delay.

But what I am trying to understand is what happens with the adjustment of key dates and completion dates… easier to explain through a scenario;

Let’s say the following Key Dates and Completion Dates apply as part of Contract Data Part 1;

Key Date 1: Design Completion: 01/04/24
Key Date 2: Construction Completion: 01/09/24 (LD’s apply at say £1,000pd)
Contract Completion Date (ie as-builts and manuals etc): 01/11/24

Construction is on going and the Contractor is delayed at their risk, forecast Construction Completion is say 01/10/24.

However, client fails to provide access to an area of the site in line with the accepted programme and causes a 2 month delay (from the original key dates), so now forecast Construction Completion is 01/11/24.

The Contractor then issues a compensation event for the delayed access, and this is accepted by the PM and a quotation is raised as follows;

Additional Defined Costs for 1 month of site prelims (eg delay costs from 01/10/24 to 01/11/24) – contract acknowledging they are liable for the first months delay (from 01/09/24 to 01/10/24), as their delay occurred first followed by unavailability of access.

The impacted programme provided along with the quote requests the following changes to the Key Dates and Completion Date:

Key Date 2: Construction Completion: 01/11/24
Contract Completion Date (ie as-builts and manuals etc): 01/01/25

Eg the full two months delay.

So I guess my query is; is the Contractor due the full EoT affectively engulfing its own one month delay in the programme and ultimately negating the LD’s that it could/should of incurred as a result of its own one month delay.

Is the correct EoT adding one month or two months onto the original Key Dates & Completion Date?

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@WilliamBrown have you any advice for kwj?

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Hi Deb, a different Brown here but I’ll give you my penny’s worth.

Delay has to be assessed in accordance with clause 63.5, this requires that the Accepted Programme (AP) current at the dividing date is used, which presumably is showing both planned Completion and the planned date when the Condition stated for any Key Date is to be met - see paragraphs 1 & 2 of clause 63.5.

You also have to read clause 63.5 in conjunction with clause 62.2. Clause 62.2 instructs the Contractor to detail time and cost effects in their quotation and the last sentence states that if the programme for the remaining work is altered by the CE it must be detailed in the quotation.

The reason I have highlighted the ‘remaining work’ is that 63.5 refers to planned Completion as shown on the AP and it also requires the planned Completion as at the dividing date to be established which could be in a different place to that shown on an out-of-date AP. If planned Completion shown on the AP was used without taking into account other things such as other delays, etc, the result could be perverse.

Therefore in order to determine where planned Completion and Condition dates are as of the dividing date (see clause 63.1 for dividing date) the assessment has to take into account delay already included within the AP and things that have happened since the AP was accepted - see the two bullets in 63.5.

The process of establishing the remaining work will identify delays caused by events other than the CE and in doing so it might uncover that planned Completion is in a different place than as shown on the AP, i.e. Contractor delays or as is put in the question, ‘concurrent delays’.

Having established where planned Completion is at the dividing date, the CE can then be inserted to see if there is any impact on planned Completion due only to the CE. If there is then the Completion Date is changed by the same amount of time as planned Completion is later due only to the CE; if there is no impact due to the CE the Completion Date is not changed.

So having established the dividing date, identifying the AP current at the dividing date and taking account of all other events that have happened since the AP was accepted, planned Completion is later than the Completion Date by say 4 weeks, then clearly this is identifying that the Contractor has caused a delay themselves, but it doesn’t stop there.
If you then impact the remaining work with the forecast effect of the CE and planned Completion moves by another 2 weeks, the Completion Date will change by the 2 weeks only so the Contractor will still be looking at a 4 week delay beyond the Completion Date.

I know I haven’t based any of the above on the scenario which K posed but hopefully the above will help, if not come back to me and I will attempt to apply it to your scenario.

Happy to discuss.

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@stevebrownassociates great response and help :grinning: