NEC3 ECC Option C: Equipment repair and maintenance

NEC3 and NEC4 Contracts SOCC SSOCC
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I have two questions on Equipment repair and maintenance:

  1. In accordance with Equipment 26, the cost for transporting Equipment to and from the Working Areas other than for repair and maintenance is paid for unless included in the hire or rental rate. Does this not imply that repair and maintenance is not paid for either?

  2. How to differentiate consumable costs from damage repair costs as referenced in Equipment 25 “Payments for the purchase price of Equipment which is consumed" . The guidance note suggests: "Some items of Equipment will be consumed in carrying out the works. These include fuels, lubricants, shuttering materials, welding rods and other similar items”.

There is significant amount of damage repairs on my project, including site vehicle tyre repairs. These could be for standard maintenance such as brake pads replacement and also for damage repairs caused by the contractor not maintaining them properly, i.e .damage due to buildup of cement and dirt around hoses causing them to be crushed. If there is a physical damage to the Equipment, in my understanding it is not treated as being “consumed”.

I note there are other posts (NEC ECC: Under an Option C contract, does the defined cost of "Equipment" include costs associated with repair and maintenance? and NEC 3 & 4 SOCC - Fuel, Oils, Lubricants & Other Consumables used in relation to hired Equipment) on Equipment 25 and 26, but they do not clarify these two specific points.

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Katarzyna, welcome to the community. In response to your queries:

  1. Repair and maintenance are paid; what is not paid under component 26 is the transportation cost (from and to the Working Areas) for repair and maintenance.

  2. Reading Jon’s response in the first link you provided, I would agree that the repair costs should be included under component 25. My justification is as follows, and always in relation to the first two items you mentioned, i.e. vehicle tyres and brake pads:

    Those should fall under the category of consumables, since they are consumed and definitions of the verb “consume” include “destroy” (e.g. a forest was consumed by fire) and, in its passive form, “waste away”.

    Regarding the hoses; to be honest I have not understood what kind of hoses you are talking about - is it in relation to the vehicles or to something else (e.g. concrete pumps)? Generally, damage to Equipment (if that is the case and they are not consumables) would be covered by the insurance against “Loss of or damage to Equipment” in the insurance table of clause 84.2 and would be Contractor’s risks until the Defects Certificate unless otherwise stated in CD Part 1 (Additional Employer’s risks).

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Damage to tyres, hydraulic hoses etc are costs incurred in providing the works and should be paid for.

Your question seems to insinuate that there is a potential that the contractor is not maintaining haul roads and not servicing the equipment regularly.

If that is the case, you can verify how often maintenance is done on a vehicle or piece of equipment because the contractor should be keeping maintenance records.

In the case of haul roads, you can issue a EWN regarding the state of the haul roads and inform the contractor that you intend to disallow costs for maintenance because the costs are excessive due to the state of the haul roads.

Essentially, you can disallow the costs until you take the steps to insure the contractor works in accordance with best industry practice (maintain equipment and haul roads regularly).

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