How long does the contractor have to submit a compensation event quotation?
Three weeks from the instruction to quote under an unamended NEC4 ECC, with the reply due 2 weeks after that; your subcontract may set different periods.
Updated: . By Jack Butler-Kettle, Construction Claims Consultant.
For what happens when the reply does not come, see how NEC4 clause 62 works.
The answer
Notification comes first, and it is a separate, earlier deadline. You must notify a compensation event within 8 weeks of becoming aware of it. Miss that and you lose the change to your price and dates, unless the other side should have notified it. Once you are asked to quote, you have 3 weeks to send the quotation. The reply is due within 2 weeks of your submission. It accepts the quotation, asks for a revised one, or says the other side will make its own assessment. Both periods can be extended by agreement, but only before they run out. The quotation is a forecast, not a claim after the event. It shows the effect on Defined Cost plus the Fee, and on the Completion Date. Defined Cost is the contract's measure of cost, and the Fee is its percentage for overheads and profit. Build it from the Schedule of Cost Components. Z clauses, the amendments added to NEC contracts, change these periods often. Check your signed subcontract before you put any date in the diary.
Example
Illustrative example. The scenario and figures are invented.
The facts
You are asked to quote under an unamended NEC4 ECC. The quotation is due 3 weeks after the instruction and the reply 2 weeks after that, and the design change is still being detailed.
What happens
- The instruction arrives, and the 3-week quotation date goes in the diary, with the 2-week reply date after it.
- It becomes clear you need longer, because the design change is still being detailed.
- The extension is agreed before the quotation date, not asked for the day after it.
The outcome
The quotation date is either met or extended by agreement before it passes. An extension asked for the day after is too late.
Compensation Event Loss Prevention diarises every quotation period and builds each quotation in the contract's own cost shape before it goes in.