We are engaged as project manager on an ECC option C project where the contractor has failed to provide its final account. Completion was achieved a while ago. Do we have to provide any notice before we make a project manager’s assessment for the final account?
There is no such thing as a final account application in the ECC, unlike other standard forms of contract. In fact, the ECC does not oblige contractors to make any application for payment at all.
Instead, the obligation is on project managers to make their own assessments at each assessment date (see clause 50.1). That obligation continues before and after completion until 4 weeks after supervisors issue their defects certificate (see also clause 50.1). Having made their own assessments, project managers are obliged to certify payment within 1 week of each assessment date (clause 51.1). If contractors make an application at any time then project managers are obliged to consider it when making their assessment and must give details to contractors for each assessment (clause 50.4).
So, you should already be assessing what is due and certifying it. In option C it is important you set up a system whereby the contractor shows the project manager its defined cost each month and the project manager regularly audits this. Project managers are failing in their duties if they certify payments based on 'say' or unsubstantiated figures – see the first bullet of the definition of disallowed cost in clause 11.2(25). This exercise should not be left until the end of the contract as it can lead to all sorts of problems arguing retrospectively about what is and is not defined and disallowed costs.
Therefore, by the time you get to completion under option C, all of the hard work should be done and the project manager should have a good idea of what the total defined cost is. And until such time as the contractor justifies any other costs, they are not due because they will be a disallowed cost until they are justified.
As to the payment of share (one way or other) the main tranche of that should have been certified by project managers at the assessment immediately following completion, and be based upon their forecasts of the final price for work done to date and the final total of the prices – see clause 53.3. The final payment of the share is made as soon as the final figures for the price for work done to date and total of the prices are known (clause 53.4).
The final payment has to be certified within 4 weeks of the supervisor’s defects certificate (11.2(6)), which in turn has to be issued by the later of the defects date and the end of the last defect-correction period. So, project managers should make their final assessment of the amount due by then.