NEC ECS: Option B - Payment For Prolongation

NEC3 and NEC4 Contracts Payment
1

I have been drafted into a contract where the client has agreed a number of delay claims. The Sub-contractor has submitted a CE which has been priced retrospectively for the delay which is agreed as having a 10 week effect on the Completion Date. Within that claim is costs for a Site Manager & Engineer based on the defined costs in the SSCC. The Sub-contractor is seeking payment for this claim.

The issue I have is that the subcontractor is being paid for these resources in the BoQ as there are Prelim items for the Site Manager & Engineer with a weekly rate for the 80 weeks of the contract so every month these quantities are increased by either 4 or 5 weeks.

If the Sub-contractor was paid the CE in full then he would be getting a double payment for the same resource. I am arguing that the entitlement to the items in the CE (The prelim items only not the rest of the claim) would not be due until the costs started to be incurred after the 80 Weeks in the BoQ is used as the client would potentially be exposed should the sub-contractor pull off the contract. The sub-contractor is demanding payment of the CE in full as well as the usual BoQ payment. Who is right in this matter?

2

Assuming that the 10 weeks is added to the 80 weeks to give a total duration of 90 weeks, then the payment assessment procedure would value the work based on the definition of Price for Work Done to Date, which is either the completed BoQ quantity or a proportion of a lump sum item.

You could pay against the 10 weeks for the Site Manager and Engineer if it relates to a period of delay at that point in time, but that would have the effect of pushing back the rest of the 80 weeks by 10 weeks. You wouldn’t pay both at the same time.

It sounds like the Subcontractor is ‘either trying it on’ or they have potential cash-flow issues.