NEC4 - Opt A - Time Barring

The Client recently declined an NCE submitted by the Contractor based on the CE being time-barred under c.61.3.

“If the Contractor does not notify a compensation event within eight weeks of becoming aware that the event has happened, the Prices, the Completion Date or a Key Date are not changed unless the event arises from the Project Manager or the Supervisor giving an instruction or notification, issuing a certificate or changing an earlier decision.”

The particular CE is concerning access issues that are currently ongoing, and have been ongoing for several months. So as an example, if the Client does not give the Contractor to an area of the site (60.1(4)), the access date should have been Aug 22, but the Contractor expects that they will not get access until Feb 23. As the event is still ongoing and has not necessarily “happened” in full, does the contractor have 8 weeks from Feb 23 to raise an NCE?

I am struggling to understand why the Contractor is time-barred based on an ongoing event that is yet to conclude. Where does the Contractor stand regarding contesting this decision by the PM?

1 Like

Hello BenM,

I’m not sure that I agree with your view that the event ‘has not necessarily happened’. Within your Contract Data you should have Access Dates, which should also be shown in your Accepted Programme. if you’re access date for the area in question is stated, and you have not been given access, even if it’s 1 day after, the event has happened, as you’ve not been given access on the date specified. That is the trigger for you to raise a Compensation Event 60.1 (2).

So in my view the Contractor has 8 weeks from when the event happened, which was Aug-22.

If i understand your sentence correctly, which in my view is that you are waiting for access to be granted so that you can assess the impact (Feb 23), this would not be correct as that is not the ‘trigger’ for the event as you were ‘aware’ you was not granted access in August 2022, or should have been aware.

This is what Project Manager Assumptions are for, so if you raised the CEN back in August the PM could have made an assumption when you would be granted access.

I would check whether you received any Instruction from the Client stating the access dates have changed, as there might be an avenue via 61.3 for the CE to be accepted.

1 Like

Thanks for your reply. Should the Contractor at least be able to claim costs and EOT for the 8 weeks prior to the NCE date, and not be entitled to assess anything before the 8 weeks, therefore the CE is not omitted in its entirety, just any effect on cost and programme prior to the 8 weeks before the notification?

1 Like

Say you had raised the Notification of a Compensation Event on the last possible day you were permitted to raise it (deadline day). If so, you would be able to include within your Compensation Event Quotation the actual Defined Cost of the work done by the dividing date, so anything within that preceding 8 week period.

If there are any costs thereafter, so longer than that 8 week period, the question would be why wasn’t the Compensation Event raised earlier as if you incurred cost (Defined Cost). I think the question would then fall back to when you were aware of the event ?

1 Like