I’ve recently joined a project and there is confusion on which programme is the 1st Accepted Programme. Some background: The Works commenced in Dec 2017, however the Contract was only signed in Oct 2018. The PM has Accepted a Programme in February 2019 and believes this to be 1st Accepted Programme for which CE’s are to be based.
Contract Data - Part 1, Cl 31.1 notes that the 1st Accepted Programme is to be submitted in 2 weeks of the Contract date.
Contract Data - Part 2, Cl 31.1 notes that the programme identified in the Contract is as per Tender, however the first Programme for acceptance is to be submitted as per Contract Data - Part 1.
The Tender Programme referenced in CD - Part 2 is in the signed contract.
We are now debating which programme is to be used for a CE which occurred in Feb 2018 well before the Contract date.
Any guidance?
If there is a programme referenced in contract data part 2 of a signed contract then that is the first accepted programme. Clause 50.3 which allows the withholding of 25% for the first programme only comes into play where a programme is not referenced in CD2.
Very often however, that programme at tender stage will not include all of the requirements of 31.2. The first programme issued for acceptance after contract award has to ensure full compliance to 31.2. Both Parties need a clear initial baseline to see what the initial plan was, so that they can assess the effect of both progress and change to ascertain any entitlement within CE’s going forward.
The Contract Date is when the contract comes into existence, rather than the physical date you actually got round to signing the contract. Legal people will tell you by conduct a contract was formed well before you signed it when you have already been working on that project for eight months. I don’t know what Parties keep allowing this to happen though as it causes so many issues and disputes in the meantime.
NEC4 Practice note 1 (you can download this from the www.gmhplanning.co.uk website) makes it clear now how you should assess CE’s and against which programme. In practice what should have happened is you would take your initial programme identified in CD2 and enhance it in line with 31.2 so it is clear what the initial baseline was. Then you should progress that programme up to Feb 18 when the CE occurred with actual progress that was achieved and reschedule the programme to see where your planned Completion was at that point (and save that as a baseline). Then you can add in the CE into the programme and reschedule it again to see if it now further affects planned Completion, and if it does that is the effect on Completion Date that you would be claiming for.
Whilst this last statement wont be very helpful - what we shouldn’t need to be doing in May 2019 is discussing what should have happened over a year ago. Everyone needs to understand the contractual rules at the time and manage them at the time - as retrospective analysis only creates subjectivity and becomes very difficult for the Parties to agree.