Frequently Asked Questions

We are a project manager on an NEC4 ECC. In NEC3 ECC, the final sentence of clause  61.1 states the contractor should put a compensation event into effect, but this sentence has been deleted in NEC4 ECC. Should we assume that, following our notification of a compensation event for a change of scope under clause 60.1(1), the contractor should put the compensation event into immediate effect because it has to  provide the works in accordance with the scope (clause 20.1)?

The deletion in NEC4 ECC has not changed the meaning of the contract in this respect. Clause 14.3 gives you as the project manager the right to instruct a change the scope, and clause 27.3 still requires the contractor to obey an instruction you give in accordance with the contract. That can only mean your instruction must be obeyed when it is given.

Furthermore clause 63.9 states that your assessment of the compensation event assumes the contractor reacts promptly and competently to the event which, in this case, is your instruction. Should the contractor fail to obey your instruction promptly, your assessment should not include any costs or programme delays caused by that failure.

Finally, if the contractor continued to refuse to obey your instruction, the client has the ability to terminate the contractor’s obligation to provide the works using the provisions of reason R11 of clause 91.

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