I am in month 10 of project and the original buyer has pulled out. We have sourced a new buyer, but they wish to make some amendments to the scope before committing to the purchase. The client has suspended all works on site immediately. What are the implications of this and how do I ensure that this will not have an effect on cost and time?
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The new buyer is of course permitted to propose the terms that they are willing to purchase on - i.e wish to amend the scope.
To answer your query better, can you explain what you are building/developing? Are you the contractor? Why has the client suspended works - is it linked to the a seller pulling out (need more inform on this one).
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As above, we need a bit more information to be able to answer this please.
Assuming you are the Contractor carrying out the work, then the PM needs to issue an instruction to stop works, this is a Compensation Event (Cl.60.1.(4). Any change to the Scope needs to be instructed to the Contractor and is likely to be a new CE (Cl.60.1.(1)). It’s highly likely this will impact cost & programme. One consideration is a descope reduces the Total of the Prices but it does not bring in the Completion Date! An increase in scope will increase cost and prolong the programme dates (Completion Date will move out).
If you know what the likely changes are then ask the Contractor what their initial thoughts are. Early engagement regarding change will allow you to consider what options are available to price up the change (CE quote). For example; Cl.63.14 allows both parties to use “rates and lump sums” to price Compensation Events (by mutual agreement).
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Harry, the other replies are right in that more detail is required. I would suggest you consider taking legal advice regarding termination of the contract
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