NEC3 ECC: Preliminary resources for a compensation event

During a compensation event, the Contractor had to use preliminary resources which are not additional and did not effect the Completion Date. However, the cost and need of these preliminary resources would have been saved had the compensation event not occurred resulting in a contribution to the Contractor’s gain. Is the Contractor entitled to a CE to recover the gain/costs of the resources for the event?

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The clause to look at is 63.1 whereby “The change to the Prices is assessed as the effect of the compensation event on …” Defined Cost and the resulting Fee (I have left out the actual vs forecast DC wording as not relevant to your question).

So if the Contractor is incurring extra Defined Cost that he would not otherwise have incurred e.g. keeping resources on Site longer when he would have laid them off, then this is an additional Defined Cost. If, however, he would have kept them on Site, but doing nothing for a while before using them again and the CE occurred which used those resources in an otherwise ‘dead’ period, then there would be no change in Defined Cost.

Lastly, I will pull you on the wording in your last sentence !
The Contractor is never entitled to a CE to recover costs. He is entitled to a CE becuase one of the listed CEs has occured. To recover additional costs, he then needs to demonstrate a link between the CE and those extra costs which are assessed according to the contract i.e. additional Defined Cost.

Hope this helps.