Under an option B contract we (the Contractor) submitted a CE quotation based on a price quoted by the original supplier. However, they subsequently changed their procurement time from 4 to 12 weeks which was unacceptable. As a result, we withdrew our CE quote via a CC and submitted a revised (more expensive) CE quote. What is our position regarding this? The PM believes we are not able to withdraw a CE and therefore we must bear the cost. The period between submission and retraction was 4-5 weeks.
There is no provision to withdraw a quotation. However, if you had new information that proved your quotation would be more expensive and you give this to the Project Manager BEFORE he makes his assessment and it was “implmented” then he would be duty bound to take that into account when he makes his assessment. I doubt very much if you had said actually the quotation was actually going to be less that he would ignore that and say he will pay your original (higher) quotation.
A Project Manager assesses a compensation event if they do not believe it has been assessed correctly (second bullet of 64.1). In this case he should make his own assessment and take into account the cost that would have been reasonable to have allowed for this event.
If this information came to light before it was implemented then there is probably little contractual recourse, but given it was known before I think the PM should take that into account.
The PM is right to say you cant withdraw a quote but wrong to think he is duty bound to accept it - when on every other occasion when it suits them they are very quick to make their own (lower) assessment of any given CE!
I would add that the Project Manager, as per case law in Costain vs Bechtel has a duty to be “impartial in matters of assessment (of CEs) and certification (of payment)”. I.e. when both evaluating a Contractor’s quotationsand making their own assessment, they have to make impartially intepret clauses in 63 and information known to them. So if the Contractor has supplied valid information which is either additional to or corrects what was in the original quotation (which the PM has not accepted yet) they should take that into account both in not accepting it and, if they decide to make their own assessment, when making that assessment.