NEC3 ECS Option B - Correcting a Defect & cost assocaited with damage to other works

We are the Contractor and achieved Completion on a hospital project on 25 Feb 2021. The Defects Date is 25 February 2022 (52 weeks). Prior to the defects date we have been notified of a Defect.

The Defect is the damage to the flush plastered ceiling due to a leaking pipe above. We have accordingly notified the plumbing subcontractor of the same Defect (leaking pipe and damage to ceiling). The subcontractor has been granted access and has only repaired the leaking pipe (their works) and not the ceiling which has been damaged. They also have no intention of repairing the Defect (correction period has now passed).

We are confused if we are to follow the Defects provisions under Clause 45.1 and essentially deduct the cost of having the ceiling damage repaired by others through Clause 50.2 (i.e. amounts to be paid to the Contractor… essentially making the deduction off their retention)? Or should we be following the Clause 82.2 or 81.1?

Or should the cost to repair the ceiling damage be pursued through the insurance table (1st line)?

Thanks

@Neil_Earnshaw any thoughts on the above question?

Assuming the Subcontractor did not construct the ceiling then the damage to the ceiling cannot be a Defect as a Defect is defined as “a part of the subcontract works” and the ceiling was not a part of the subcontract works whereas the leaking pipe was.

The Subcontractor has therefore complied with clause 82.1 by repairing the damage to the subcontract works.

However, the Subcontractor is required to insure against “liability for loss of or damage to property … caused by an activity in connection with this subcontract” which covers damage to the ceiling as a result of a leaking pipe installed by the Subcontractor so yes this is an insurance matter and clause 85.4 may also come into play.

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