During Girder Casting, defects have been notified to the Contractor thru Supervisor’s Defect Notification. Correcting this defects will incur cost. Can the Project Manager disallow this costs?
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It depends in part under which contract you are working under. Under option A/B you do not have any “disallowed cost” provisions as it is not necessary due to the nature of those contracts. If the Contractor has done defective work under option A, there is no mechanism to get paid for it so there is nothing to disallow.
If you are working under ECC options C/D/E/F then you need to look at the definition of a disallowed cost to see if it is one. Cost of correcting a defect after Completion is disallowed, and cost of correcting a defective caused by Contractor not complying with a specific constraint in WI as to how they should provide that element would be disallowed, but that is it. The idea of correcting defects particularly under options C/D is that they are a shared risk and will eat into gainshare if they occur. Do look out for amendments however, as Z clauses may or may not add further reasons to disallow costs associated with defects.
Just to amplify on a point made by Glenn : a Defect caused by the Contractor not complying with a constraint in WI would typically mean they did not follow a method for how they were to do the work and there is a causal link with the Defect as a result.