We have a delay on a project and we believe that the Client is responsible for the delay as the source of the delay is covered by Compensation Events, under the contract. The CEQ’s for the events have not yet been agreed however, the PM is assuming that the delays are Contractor culpable and is therefore employing an RICS method of evaluating our Preliminary costs under NEC Option B, which is used designed to be used when the Contractor is in culpable delay. The document being employed by the PM is the RICS interim valuations and payments.
The PM is using our Clause 32 programme, which has not been accepted and which, quite correctly includes a significant change to planned completion, to reflect the Client driven delays.
The PM is effectively stretching our preliminaries over the planned duration of the works, rather than the original duration for the works and upon which the original BoQ lump sum was based for our time related preliminaries.
The effect of this approach is that the monthly valuations are significantly lower than what was envisaged at tender stage and this is having a detrimental effect upon our cashflow. At present the contract is delayed by circa. 6 months.
Is the PM correct to adopt this approach under NEC 4? Is it correct to employ non contractual processes to evaluate PWDD under the NEC 4. Does the approach adopted conflict with Clause 12.4?