A common question for those new to NEC - and especially those tendering for the first time under option B : Priced Contract with Bills of Quantities of the Engineering and Construction Contract (ECC) - is what happens under the contract if something is missing in the Bill of Quantities but is clearly indicated on one of the tender drawings within the Works Information ?
It is a relatively simple question to answer. Let us take an extreme example to illustrate the point : say you are tendering to build a new sports stadium under option B and the drawings clearly show a roof to go on. However, the Bill of Quantities make no reference to the roof what so ever. As a Contractor at tender stage, assuming you noticed this, would you or should you programme or price for the roof? Now the initial answer of course is to contact the Employer during the tender and get clarification. This, at the very least, would help your credibility and relationship with the potential Employer. However, what happens if you do not query it during the tender stage, or more likely to happen, what would happen for the smaller elements that you genuinely did not notice and hence did not question at tender stage?
There are a few contractual facts that we can certainly deal with here :
- The Bill of Quantities is a contract document (see option B clause 11.2 (21)).
- The Bill of Quantities is not the same as the Works Information (see option B clause 55.1)
- By the very nature of Option B – the risk in producing and verifying the Bill of Quantities lies with the Employer (as opposed to option A where the risk in missing something off the Activity Schedule lies with the Contractor)
- Bill of Quantities has not included an element to price specifically for the roof
- Clause 20.1 requires the Contractor to provide the works in accordance with the Works Information
- Under clause 17.1 this is an ambiguity or inconsistency between contract documents and therefore the Project Manager (PM) should give an instruction resolving the matter
- Clause 60.6 states that the PM corrects mistakes in the Bill of Quantities which are due to ambiguities or inconsistencies. It also states that each such event is a compensation event.
- Clause 60.7 states that in assessing a compensation event which results from a correction of an inconsistency between the Bill of Quantities and another contract document, the Contractor is assumed to have taken the Bill of Quantities as correct.
Taking all this into account, the bottom line is that the Contractor does not need to either price or allow time within the programme to build the roof. The roof itself (if required) will be assessed as a compensation event, and this will assess both the entitlement of time and direct cost. This all leads to the following important conclusions:
- As soon as you notice something that is an ambiguity or inconsistency let the other party know. Contractors may think they are giving up a potentially commercial advantage, but it will give them real credibility during the tender and demonstrate their commitment to working in a “spirit of mutual trust and co-operation”, as well as avoiding either a contractual or political dispute on the live project
- Not withstanding point 1 above, Contractors should price and programme the Bill of Quantities, not the Works Information
- Any omission from the Bill of Quantities will be assessed as a compensation event and the Contractor is entitled to the direct cost of the change and the effect of time if planned Completion is affected.
About the Author
Glenn Hide is a recognised NEC expert practitioner with particular expertise in programming. As well as being a successful trainer and consultant in his own right, he co-authored Built Intelligence NEC eLearning Academy, answers questions on their ReachBack facility and organises their annual conference. If you have any comments or questions on this matter, please contact the him on on glennhide@builtintelligence.com or 07500 777 364.