Negative Compensation

NEC3 and NEC4 Contracts Compensation Events
1

Hi,

At tender stage, the client provided the design information, which contained the quantities of tonnage we were required to price. Our Target Price (working on the NEC 3 Option C subcontract) was agreed. Subsequently the design has been developed / detailed further and this has resulted in the required quantities to be significantly (50%) less than we originally priced. The client is now looking for a negative compensation event to reflect the actual quantities on the detailed design. Is this a change to the Works Information? My argument, so far, has been that the scope of the works have not changed and it would appear their designers had incorrectly assumed / forecast the amount of steel required. Now that the design has been further developed, can the Client say this is a change to the WI and instruct a CE to price the reduction in the Total of Prices?

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2

Hi
If the tonnage was stated in the Works Information at tender then yes it is a change to the Works Information and a CE unless you can demonstrate the work itself has not changed (ie the quantities are still the same as tender) and it was a take off error by the Client which caused an ambiguity.

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