The Employer has terminated due to financial restrictions. What does the Employer and others need to do to put the termination provisions into effect?
Lee
Under NEC4A the right to terminate due to âfinancial restrictionsâ ( I take that to mean they dont have the money to pay for the Works) is not a ground that the Employer can rely upon to terminate.
Reasons for termination for âlack of moneyâ are set out in Clause 91 and these are that if one party is âinsolventâ then the other party can terminate. The Employer cannot terminate because it doesnât have the money to pay you.
It seems that the best way forward would just be to draw up some form of variation to the Contract that brings it to an end and which includes a financial agreement.
Glenn Hide has rightly pointed out that if Option X11 has been used then they can terminate at will. In order to do that the Project Manager has to issue a Termination Certificate under Clause 90.1.
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Mike below is absolutely right that âfinancial restrictionsâ is not a direct reason to terminate. It would, however, come under "A reason other than R1 - R21â as per the table in clause 90.2 from which the relevant procedures and amounts due would flow.