NEC 3 Option E with zero LAD

We have an option E with zero LAD’s contract. Contractor has little incentive to push the (difficult) project along and regularly seeks longer contract period via CE etc. If the proposed programme is not agreed with, so the contract completion is earlier than the planned completion - who pays the prelims etc for the ‘over-run’ - can these be disallowed?

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I presume when you say ‘zero LADs’ that means you don’t have secondary option X7.

Whilst this means that damages for ‘late completion’ are not liquidated into a sum of money and applied as a contract mechanism, ‘unliquidated’ damages can still be pursued, although as a legal rather than a contractual remedy.

In your scenario I presume you are referring to the Completion Date (‘contract completion’) which means that Completion is not likely to occur until after this date.

Although it is unlikely you would be able to consider such extended preliminary costs as a Disallowed Cost (in accordance with the definition at 11.1 (25)), these could well be treated as part of your unliquidated ‘loss’.

The only real issue I can see is determining the Completion Date as there appears to be disagreement with the assessment on both sides.