WE have a situation in an Option A contract where we have as Contractor submitted various routine documentation for acceptance, As-built drawings, for example. Now two years later, after Completion but before the Defects Date, we have received comments back from the PM which need to be updated into the documentation. We immediately notifed a compensation event according to 60.1(6).
The PM has rejected the CE notification, arguing that we should have issued an early warning that a reply, i.e an acceptance was outstanding and we did not. Anyway, he continues, the information offered was, to quote the first bullet point of 61.4, arises from a fault of the Contractor.
We consider this argumentation to be contrived but is the PM correct that we should have issued at least a reminder, even though we were not too interested at the time whether he was going to accept the documentation or not?
I don’t think the PM is correct. The PM’s failure to reply in the period for reply (or the period prescribed) is not due to a fault of the Contractor. I do however think he would be right to point out that the Contractor’s notification is out of time, ie not within 8 weeks of becoming aware, and therefore it is not entitled to a change in the Prices or Completion Date.
I think the matter of raising an early warning is academic, but would ask the PM why he didn’t raise one!
A slightly confusing question/situation.
If the comments back from the PM are correct all be it late then these would seem to be a defect (something not in accordance with the Works Information) and you are obliged to correct a defect. Not sure what entitles you to notify a CE under 60.1(6). It didn’t stop you at the time - you carried on anyway. I get that it would have been better had they communicated this (a lot) earlier - but if your details were not correct they need correcting.
Not sure what the relevance of the early warning is here or what difference it makes contractually. You can only notify an early warning for something you are aware could be an issue. I doubt at the time you knew it might be.
The PM only has to accept something that the Works Information or contract says they have to e.g. programme, design, subcontractor etc. Even then, their acceptance does not take away the liability for the Contractor to comply with design/Works Information.
So, unless their comments to correct is a change to the Works Information I see no reason why this would be a compensation event (but would agree it is very unhelpful/not in the spirit of the contract to be so late - but nothing contractually I see you can do about that).