There is a minor conflict for an item in the Works Information where one document states a completely different (and lower quality) product than all the rest of the Works Information. The Bill references the correct specifications and it it has been priced accordingly by the Contractor.
The discrepancy has come to light and the Contractor is now claiming that they priced the lower specification item based on the rogue description.
Additionally, it is the lower quality item that has been installed.
I have sympathy with the Contractor as the ambiguity is the designer’s responsibility, however, the Architect is quoting clause 60.7 (this is an NEC3, Option B contract) and saying that as the lower quality item has been installed, although suitable, they expect a saving.
Contractor is referencing their opinion that under the contract, any errors or ambiguity in the Works Information is the Designers risk.
Firstly the Project Manager needs to decide which product is required and instruct the Contractor accordingly under clause 17.1 ambiguities and inconsistencies. If the Contractor was aware of the issue at the time they shouldn’t have gone ahead and assumed that the lower quality product was correct, they should have notified the Project Manager under clause 17.1 and awaited an instruction.
You don’t mention if the BoQ references the higher or lower quality product however I assume it is the higher quality one.
If the Project Manager can accept the lower quality product then both the Works Information and the BoQ need to be corrected to state this by using clause 17.1.
When reading clause 60.6 and 60.7 together (1) this correction is a compensation event that can reduce Prices and (2) in assessing the compensation event the Contractor is assumed to have taken the BoQ as correct. Meaning the Architect (who I presume is acting as the Project Manager) is correct to seek a reduced rate.
Alternatively the Project Manager could have insisted on the higher quality product and corrected the Works Information using clause 17.1. In this case, provided the Contractor was unaware of the inconsistency at the time they installed the lower quality product they would be entitled to a compensation event under clause 60.1(1) and in the assessment it would be assumed that the Contractor had priced for the lower quality product (clause 63.8). If however the Contractor had known about the issue then the compensation event may not be accepted. It might be possible for the Project Manager to claim the only reason it occurred was because the Contractor had failed to comply with the duty to notify the inconsistency under clause clause 17.1 and as such it arose due to his own fault which is a reason to not accept the compensation event under clause 61.4.
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Thank you for your considered and informative response to the question
Neil, thank you for your explanation. What’s your understanding if the contractor installs the higher priced item, without raising an ambiguity notification. And then the QS’s get hold things and retrospectively claim they only prices for the cheaper item and therefore they are entitled to a Compensation Event for the difference in the price. Should the CE claim not be made before the Contractor engages in the activity.