We are the employer under an ECC. The contractor notified our project manager of a compensation event in accordance with clause 61.3. However, the project manager said insufficient information had been provided in the notification for him to make a decision on whether the prices, completion date and key dates should be changed in accordance with clause 61.4. Can the project manager use the provisions of clause 13.4 to withhold acceptance for the reason being that more information is required to assess the contractor’s submission fully? Or is a compensation event notification not considered to be a communication submitted for acceptance and therefore not appropriate? We are the employer under an ECC. The contractor notified our project manager of a compensation event in accordance with clause 61.3. However, the project manager said insufficient information had been provided in the notification for him to make a decision on whether the prices, completion date and key dates should be changed in accordance with clause 61.4. Can the project manager use the provisions of clause 13.4 to withhold acceptance for the reason being that more information is required to assess the contractor’s submission fully? Or is a compensation event notification not considered to be a communication submitted for acceptance and therefore not appropriate?
We are not sure what information the project manager expects but, at this stage, it is should merely be enough to decide if the event is a compensation event. It has little to do with value other than as a sense check to decide if it will have an effect upon defined cost, completion, or meeting a key date (note the ‘or’, not the ‘and’ you have used). Details of the value will come when the contractor provides the quotation, and the project manager will then have the ability to make his own assessment if he does not agree with it – see clauses 62 and 64.
If there is not enough information to enable the project manager to decide that the event is one of the compensation events listed in the contract, he should discuss it with the contractor to understand it better. If the project manager is still not satisfied then he should notify the contractor that it is not a compensation event listed in the contract and therefore the prices and so on will not change.
At the same time, the project manager should also inform the contractor that if it still considers the matter to be a compensation event, it should submit further information to assist him.