NEC4 - Contra Charges

NEC3 and NEC4 Contracts Risk and Insurance
1

Contractor on NEC4 Option C scheme, we are being Contra Charged costs accrued by our client as a result of our defect. However, some of the costs are far higher than we expected, i.e. two days plant hire costs which exceed the cost of buying the plant outright etc. and when we have asked for substantiation of the cost the client is refusing to provide it, claiming it is sensitive.

Surely they cannot enforce these charges if we are not provided with the substantiation to support it? It is my understanding that it is our client’s obligation to evidence the costs for their claim to be valid, and mitigate them where possible. Please advise how I should proceed with this.

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Assuming that you are talking about notified Defects after Completion, whereas you were either given access but did not correct them within the defect correction period, or you were not given access in order to correct them, it is the Project Manager who assesses the cost - to the Client for the former scenario and the Contractor for the latter - for the Contractor to pay.

You should have visibility of the Project Manager’s assessment - if in your opinion it is dubious or excessive you should dispute it and ultimately (should negotiations fail) follow the dispute resolution process.

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