We are the project manager on an NEC3 Engineering and Construction Contract (ECC). We are in the defect liability period and have instructed a search as we believe there is a defect. There are costs associated with facilitating access for the contractor to conduct the search. We understand that if a defect is found, any costs incurred with conducting the search would go to the contractor’s account and, if it is a fault with the employer’s design, then the employer would bear the costs. Is this correct?
The contractor is obliged to correct any defects that are found (see clause 43.2) and the employer is obliged to allow the contractor access to and use of the part of the works involved, which is arranged by you as project manager (see clause 43.4). The contractor is not required to pay any costs associated with the employer carrying out its obligation to provide access. Therefore, as with any other of the employer’s obligations, no such costs would be payable. This would apply both to providing access for searching for the defect as well as for its correction.
owever, with regard to paying the contractor’s costs for a search, if no defect is found this will be a compensation event (see clause 60.1(10)) and the employer will pay the cost of the search. If a defect is found, then the contractor will pay its own costs for the search and for the correction of the defect.