We are using an ECC (NEC3) Option B contract. The PM requested a quotation and programme to Accelerate, this was agreed by all parties and the quote was accepted. The contractor did not full commit enough resources to the work and missed the new agreed Completion Date. Where does this leave the PM as he accepted a quote but has not received the delivery he paid the additional money for ? Is the contractor entitled to the full value of the acceleration quote ? There are no Key Dates and the PM has not encountered consequential loss.
Clause 36.3 states that when the PM accepts the quotation the Prices and Completion Date are changed accordingly. If the Contractor fails to achieve the new Completion Date the Employer would be entitled to delay damages in the same way as if acceleration had not happened i.e. they would be calculated from the new (earlier) Completion Date until the date Completion is achieved. There are no provisions entitling the Employer to recover the additional money paid for acceleration.
2 Likes
Hello Neil - In this instance there are no Liquidated Damages in the contract. Would this therefore mean that this was a risk that sits with the PM, he must determine the risk/reward when accepting the acceleration quote. In this instance, the additional cost did not bring the anticiapted reward and is non-recoverable ?
If there are no delay damages then unless the Contract Data states in X7 that the delay damages are £0 / £ nil per day the Employer is entitled to recover unliquidated damages i.e. their actual losses as a result of the Contractor’s breach of contract. There is no express term in the contract that allows this however it is still legally possible, it’s not straightforward though as the Employer will have to prove that the Contractor was in breach and prove the loss. The risk of not achieving the new (earlier) Completion Date is effectively shared between Employer and Contractor as both will suffer loss for it not being met.
1 Like