Delay assessment for an achieved key date

Our contract is NEC4.

The Contractor had submitted the quotation for a CE in 2021 and PM’s delay assessment had been done in 2021. At that time, 10 days extension of time (EoT) has been assessed to key date. Under our contract, approval of the PM’s delay assessment from the Client is required before implementing the CE. Such approval from the Client was just received recently, and therefore we would like to implement the CE now. However, key date of the contract had been achieved in Feb 2022 and notification of achieving key date already issued to the Contractor. In this case, any delay to key date have to be granted? If yes, this is based on the programme at dividing date (i.e. 2021) and ignore the current fact that it is achieved?

Our thoughts are as follows:-

(i) If we take into account of the actual achievement of key date in February 2022 (clause 30.3), the planned date for key date in the current latest Accepted Programme is the same as the achievement date (i.e. February 2022). Following this, the Contractor does not need to pay delay damages as per Clause X7. We consider that it is sensible not to ignore this actual achievement date by the time of implementing the CE to reach a fair and reasonable assessment. That is, the PM does not need to grant 10 days EoT to key date.
(ii) Or should we follow our assessment in 2021, that is, the PM still grant 10 days EoT to key date for the reasons that the Programme at the dividing date which is in 2021 showing there is a 10 days delay?
(iii) Our concern on (ii) above is that, will there be any implication of the contract that planned date when the Condition of Key Date will be met in the Programme is now later than the actual achievement date of key date?

Currently, the Contractor is insisting on approach (ii), and we (as a PM) consider approach (i) is more correct.

It appears your’re merging Sectional Completion Dates and Key Dates. These are two different mechanisms and the processes which manage these are different although they can be linked.

If we’re talking about assessment of a Compensation Event, then your first paragraph is correct So, the Compensation Event is assessed at the dividing date (63.1 / 63.5). It is the Accepted Programme at that time which is used to assess the impact to the Completion Dates / Sectional Completion Dates. Once the CE is implemented the Contractor shall submit their programme for Acceptance reflecting the Implemented Compensation Event which will move their Sectional Completion Date to whatever the Project Manager has assessed.

If a Key Date is linked to a Completion Date, the Contractor should be included in their assessment how this Key Date has changed and any costs incurred as a result of this being moved

What happens in between you Implementing this event as the Project Manager from the Dividing Date is of no relevance in my opinion although it has been made much more complicated as it should of been due to the unusual lateness of the Project Manager implementing this event.

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