Frequently Asked Questions

We are the project manager on an NEC4 Engineering and Construction Contract (ECC). One of the changes between the NEC3 ECC and the NEC4 ECC is the wording at clause 17.1 for dealing with ambiguity in or between the contract documents. NEC3 ECC obliged us to give an instruction to resolve the ambiguity, however NEC4 ECC clause 17.1 changes the word from 'instruct' to 'state'. Volume 4 of the NEC4 users guides suggests this change reflects that project managers only have the power to change certain aspects of the contract (e.g. we cannot alter the terms and conditions). If there is no obligation on us to give an instruction to resolve an ambiguity in the scope when using NEC4 ECC, then how does this turn into a compensation event as envisaged under clause 63.10, so that it can be dealt with at the time rather than becoming an issue at completion?
As the NEC user guides suggest, there are certain ambiguities and inconsistencies which cannot be resolved by an instruction form you as the project manager, because your powers to instruct a change to the contract are limited. The most common of these is if there are ambiguities or inconsistencies between the contract and the client’s Z clauses. Some Z clauses introduce such uncertainties and in that case only the parties can agree how to deal with those because you have no powers to change the terms of the contract or Z clauses. If the parties cannot agree on any changes, then they are only left with the law to sort the problems out. That is why constraint should be exercised in the use of Z clauses, and any that are used must be carefully considered to ensure they are consistent with the standard clauses in the contract However, in the case of inconsistencies or ambiguities within the scope, the matter is different. Here, you have the power to issue an instruction to change the scope. In that case, when you become aware of an ambiguity or inconsistency within the scope, you must state that an instruction to change the scope will be given. Subsequently you must then issue that instruction and notify a compensation event.

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