How does the Project Manager instruct termination of the contractors sub-contractors but not the contractor

In short, he or she can’t ! Section 9 gives no authority for the Project Manager to do this.

So off the top of my head you have these options :

  1. Clause 26.1 makes it clear that the main contract applies whether the Contractor subcontracts the work or not, so if the breach is ‘substantial’ enough at main contract level you could terminate at main contract level (but make sure it is substantial).

  2. With back-to-back provisions under the full subcontract (ECS) conditions and similar provisions under the short subcontract (ECSC), what is a minor default at main contract level may be a major default at subcontract level. You could encourage the main Contractor to take up this option.

  3. You could take out the subcontractor’s remaining scope from the Works Information, which would be a negative compensation event. If the main contract was under options A or B, this should strictly be assessed using the Shorter Schedule of Cost Components, although by agreement it could rates and lumps could be used (see clause 63.13/14). If the main contract was options C, D or E, it would be assessed as per that subcontract - which would probably be by the main Contractor terminating the subcontract due to the default of the Subcontractor.

I should add to point 3, that (a) the Contractor’s subcontract fee percentage would be applied negatively and (b) that if the deletion if work is too great or is for work at the tail end of the contract, then it could be considered as termination.

There is also the option of clause 24.2, instructing the Contractor to remove certain persons from site and stating his reason for so doing. Depending on how large the subcontract is and the actual reason for wanting to terminate in the first place, this may be a practical compromise.