Frequently Asked Questions

We are the contactor on an NEC3 Engineering and Construction Short Contract (ECSC). During a spell of extreme weather we had stop work on site for 4 months and deploy additional mitigation measures to prevent water pollution. There is no item in the price list for mitigation works although there is a paragraph in an associated appendix that states we are to provide mitigation works for all ground and surface water. We are in discussions with the client and believe we should be due something extra for the mitigation works as this was an extreme occurrence no one could have predicted. However, the client disagrees, saying it states in the associated appendix that mitigation works are covered. Could you possibly clarify?

In the ECSC you will be compensated both in time and money if an event listed as a compensation event in the contract happens. This is covered in section 6 of the contract (clauses 60 to 63). It is irrelevant what you were supposed to have allowed for such events; the monetary and time effects of the listed events are effectively the client’s risk.

One of the compensation events is when you are prevented by weather from carrying out the works for more than one seventh of the original time to carry out the works, see clause 60.1(10) for a more detailed description. It seems likely the 4 months delay you refer to will fall within that definition. If so, this is a compensation event. This is not something that can valued based upon the prices in the price list and therefore clause 63.2 applies. You will be paid the increase in defined cost caused by the weather event, plus one or other of the percentages for overheads and profit you quoted in the contract data. That would include the cost of any additional mitigation measures as well as any other costs caused by the delay. Defined cost is a defined term (see clause 11.2(5)) and is based upon the costs you actually incurred, but only for those items listed in 11.2(5).

In addition if the weather event caused a delay to the planned completion (see 11.2(1)), the completion date (i.e. the date by which you are obliged to achieve completion) will be moved back by the length of that delay, see clause 63.4. You and the client will need to follow the processes set out in clauses 61 and 62 to deal with the weather compensation event. You should start by notifying the compensation event as soon as possible.

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