NEC ECS: Option A – Extent of Subcontractor’s Liability under Clause 82.1.

NEC3 and NEC4 Contracts Risk and Insurance
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I am currently working for a Subcontractor employed by main Contractor under a NEC3 ECS Option A subcontract.

We have recently raised several EWN’s and NCE’s regarding damaged (mainly accidental) to our subcontract works caused by other subcontractors. We do however note that in some instances we have not been able to demonstrate which particular party is responsible for such damage due to the large number of trades currently on site.

The Contractor has subsequently rejected all our NCE’s raised in connection with this matter stating that pursuant to clause 82.1, all repairs (irrespective of who caused the need for repair in the first instance) is a Subcontractor risk and consequently all repair works should be undertaken at our own expense; something we consider unreasonable.

We maintain that as we are not responsible for the site nor the security of it, do not have exclusivity to any particular area of site and have no contractual relationship with other trades, therefore the above must be considered a Contractor’s risk and as such, further to clause 60.1 (14), we should be entitled to a compensation event when carrying out repair works arising from damaged caused by others. However, the difficultly we are having is that we cannot pinpoint this to a specific Contractor’s risk as listed under clause 80.1.

We anticipate that as works progress, this problem will become more prevalent so would be grateful for any guidance pertaining to this matter.

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The Contractor is correct unfortunately.

Clause 81.1 says that all the risks that are not the Employer’s or the Contractor’s are yours. The Employer’s and Contractor’s risks are listed at 80.1 and none of those are for loss or damage to your works during the course of the works.

In additional clause 84.2 states that loss or damage to the subcontract works is a matter for insurance taken out by you.

If it is something that becomes out of control you could claim the contractor is in breach of an implied term to manage its subcontractors which could potentially be a compensation event under 60.1(18) and if the Contract says it is out of his control then it could be a compensation event under 60.1(19), but in either case it is only if the damage is significantly more prevalent than would be reasonable.