Under an NEC3 ECC Option D target contract on what basis could an employer not pay the defined cost for repeated attempts by the contractor to rectify a defect

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This is similar to a comment you raised in a more general discussion but the answer, in essence, remains the same. I have pasted it below for clarity.

I think the test here really is whether the cost incurred in attempting to correct a defect but failing has been incurred properly or has it been incurred improperly in the sense that resource and material used to ineffectively rectify a defect has not been used to Provide the Works. On that basis you would get paid once for, in fact, fixing the defect but all costs incurred in unsuccessful attempts would be disallowable.

In looking at this you need to consider what the defect actually is and whether you are getting multiple attempts to fix a single defect or there are in fact multiple defects giving similar symptoms or there is one defect but only symptoms rather than the underlying problem are being addressed. This needs careful examination on the facts before any disallowance is made.

The whole issue of Defects as Rob has highlighted is very involved and each situation requres careful consideration.