The project manager believes that we, the contractor, must price the omission from first principles instead of omitting the BQ item. The contract is NEC3 Option B.
NEC3 ECC: When is it reasonable to omit a BQ item when you are pricing change from first principles?
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The Project Manager is right as you only use BoQ rates for assessing compensation events by agreement - see option B clause 63.13, last sentence and he / she seems not to be agreeing to it !
So the default is core clause 63.1, which includes for omissions.