The Contract is NEC3 ECC Option A and Secondary Options X2, X5, X7, X13, X15, X16, X17, X18, Y(UK)1, Y(UK)2, Y(UK)3
As a result of COVID-19 the Project Manager has confirmed that this is a Compensation Event and issued an instruction in accordance with Clause 19.1 to demobilise from site. Given that equipment cannot be removed from site as this would be defined as non-essential works and the Contractor has no other working sites for this equipment, should the Project Manager accept that all equipment within the working area is included within the Contractor’s quotation?
It sounds reasonable that the Employer will have to accept some / all of this cost as part of the compensation event quotation however the Contractor will need to demonstrate that it is paying for the Equipment whilst it is on site. If the Equipment has been stood down it may be that the Contractor is no longer incurring costs with the hire company and as such the Employer should not pay for it.
More so than usual I’d recommend the parties work collaboratively on the quotation and that the Contractor is completely open and transparent about the effect on it’s business of current events. I suspect some unscrupulous Contractors (yes even ones on NEC contracts!) will see this as open season and a license to print money. Employers and their Project Managers need to be vary of this and ensure they do their due diligence rigourously.
If this is Contractor owned equipment and therefore no hire costs are being incurred under which clause would you reference to refuse payment? Would it be relative to the SOCC - it is not used to provide the works and therefore under 11.2(26) disallowed because it is resources not used to provide the works?