NEC ECC: Planned Completion on Accepted Programme already passed vs Cl 60.1(19)

NEC3 and NEC4 Contracts Compensation Events
1

We are in the unusual (some may say usual!) scenario in that we have not had an Accepted Programme in place for 17 months. We continue to submit programmes however the PM has simply ignored these - neither accepting or rejecting despite significant correspondence on the matter.

Both the Completion Date and planned Completion Date have lapsed on the current Accepted Programme.

We are now in a position where the PM has rejected our CE notice relating to COVID-19 under cl 60.1(19) on the basis that the dates on the Accepted Programme lapsed before the event occurring. Clearly had the PM been acting reasonably and been fulfilling his duties with respect to programme the planned Completion date would have been adjusted accordingly (current completion is forecast for Spring 2021). He is in effect using his own breach of contract as a way to reject our CEN. I would just add that the Completion Date is subject to a host of CE’s which are also in dispute but that’s a question for another day.

Clearly this is a scenario which the Contract does not envisage and the contractual mechanisms with respect to programme and CE’s have completely broken down.

I’m just wondering if anyone has any thoughts on how to get around this particular issue of the dates on the AP having lapsed prior to COVID-19 occurring?

2

Your predicament is not unheard of but I’d be stretched to say I thought it was usual. I’m not sure what this uncooperative PM thinks he / she is gaining by ignoring the programmes you are submitting. It’s good to hear that you’ve continued to submit programmes despite them being ignored, it will but you in good stead if / when you end up in dispute and I’m afraid that’s your only remedy in this situation.

The PM is mistaken in rejecting your CEN on those grounds, it is widely acknowledged in industry that the COVID-19 outbreak has triggered CEs under clause 60.1(19). The reasons for not accepting a CEN are stated at clause 61.4, the relevant one in this case being that the event “has no effect upon … Completion”. Note it does not make reference to planned Completion as shown on the Accepted Programme therefore what the last Accepted Programme said is irrelevant. I’d suggest you send a strongly worded letter to the PM / Employer pointing out the error of their ways and if that falls on deaf ears it’s adjudication. It sounds like you’re unfortunately going to end up there one way or another in any case.