Subcontractor's programme acceptance

Hi all,

This is the sequence of events we would like to get some guidance:

  • Contract Start date: 18-Jul-16

  • Clause 31 programme accepted: 26-Oct-16

  • First Cl32 submitted: 06-Nov-16

  • Cl32 incorporates an NCE that happened before the data date (all events are in the past). The sequence of events of this NCE has not been yet agreed between us and the Subcontractor.

  • The subcontractor has put the sequence of events in a commercially beneficial manner to them: we do not agree to it. We believe they want to build up their case to claim EoT.

  • Commercially, we have not yet received their EoT claim / not initiated this discussions.

  • All the rest of the programme (forecast etc.) is correct and it can be accepted.

I would like to seek advice in two questions:

Can we accept “with comments” the programme caveating our disagreement on the NCE, and commenting why we disagree?
Would this “acceptance with comments” undermine our position when in the future we are assessing/arguing the EoT of this NCE?

1 Like

You can accept a programme without needing to worry about the liability of a CE. Let’s assume on the last accepted Programme their planned Completion/Completion Date is the same. If they have issued a programme with an item tagged “NCE01 – delay due to bad ground conditions” which is a four week item which delays planned Completion by four weeks you could accept this programme.

If subsequently you reject their CE altogether as that ground is considered their risk, then they have planned completion four weeks beyond Completion Date. It is not a compensation event, so Completion Date will not move so it is their (Subcontractor) liability. If you agree it was a CE but assess it should have only had a two week impact, then Completion date will only move by two weeks and the two week gap to planned Completion is their liability. In both of these examples the fact that you accepted their last programme with the four week CE in is irrelevant in terms of the compensation event process and agreeing liability.

Therefore you can accept their programme. It does no harm to add a comment (almost “for the avoidance of doubt”) that you do not yet agree with liability for the compensation event as shown but that it will be reviewed as part of the compensation event process. An acceptance with comments (rather than “caveats”) is still acceptance and a very useful mechanism to add comments that may be issues in the future (but in meantime is accepted).