When a Contractor verbally instructs a Subcontractor to de-mob part of work force ( and the Subcontractor issues a CE to coincide with this )
The Contractor then states that they didn’t officially instruct the subcontractor in writing to do this therefore are rejecting the CE in question,
How would the Subcontractor reply to above?
This is a prime example of why NO one should ever act on a verbal instruction. 13.1 requires any such instruction to be in writing, and then IF this instruction is a reason under 60.1 as to why it is a compensation event then it can be notified as a CE by the Subcontractor. If the Contractor agrees then you would go ahead and issue a quotation.
All you can do now is get around the table and try to negotiate your position here. You can point out about 10.1 and spirit of mutual trust and cooperation (remembering that clause also starts by stating do what the contract says - which includes only following an instruction if it is in writing).