The Client has issued a PMI with revised drawings which reduces the quantities in the BoQ and in some cases completely omits BoQ items. No work has been undertaken on these BoQ items.
Under Clause 63.1, where the quantity has reduced, is the forecast Defined Cost based upon the difference in the reduced quantity (i.e. 100m - 70m = 30m) OR is it the difference between the forecast Defined Cost of the quantity in the original BoQ item (100m) and the forecast Defined Cost of the quantity in the revised BoQ item (70m) and disregarding the original BoQ rate.
Where the BoQ item has been omitted completely, it does not seem right to use the forecast Defined Cost as the process if the works are not required at all unless the latter option in the above scenario applied. Otherwise, the Contractor would be pay for the privilege of this omission.
firstly, items should not have been omitted from the BoQ, the corresponding items should have been omitted from the Scope under a PM’s instruction given under clause 14.3; information in the BoQ is not Scope or Site Info - see clause 56.1.
Under all main Options the assessment of a CE is based on the effect of the event upon the forecast Defined Cost of work done or not yet done, as per clause 63.1.
BOQ rates and Prices can only be used if there is mutual agreement between the PM and the Contractor to do so - clause 63.2.
Where work is omitted the Contractor’s quotation has to forecast the Defined Cost of doing the work that has been omitted, e.g. for an item in the BoQ priced at £100 the forecast Defined Cost plus Fee is hopefully lower than the Price, say £90. In this case the Prices are reduced by £90 not £100, the BoQ is changed so the difference is paid to the Contractor.
Of course it could go the other way, e.g. for an item in the BoQ priced at £100 the forecast Defined Cost plus Fee could be £110; the original Price might have been under priced. In this case the Prices are reduced by £110 not £100, the BoQ is changed so the difference is paid to the Client.
This maintains the pricing risk which the Contractor carries when pricing the BoQ at tender.