Within our Schedule of Cost Components (SoCC), there is an item as follows, “Relocation charges, where agreed by the Contractor in advance of the cost being incurred.”
Unfortunately we have a few people that did come from overseas specifically for the works and there were relocation charges associated with them moving over.
The Contractor, after all the works have now completed, has stated that as no prior approval of the relocation costs were given by them, the relocation costs are disallowed.
However, when I review what constitutes a disallowed cost, there is nothing stated in there that would suggest these cost can be disallowed.
We have the usual items under ‘Disallowed Costs’ such as, costs that cannot be substantiated; are incurred due to fraud; should not have been paid to a subsubcontractor as well as cost for correcting physical defects.
There is no mention of disallowing costs if they are not in accordance with the requirements under this contract (or SoCC).
Therefore my question is, whilst I acknowledge that relocation costs were not agreed in advance, can the cost be disallowed in it’s entirety or should the Contractor be making their own assessment of the charge?