What does NEC4 clause 60.1(21) mean?
It makes any extra compensation events written into the Contract Data count just like the numbered ones, notified, quoted and assessed the same way.
Updated: . By Jack Butler-Kettle, Construction Claims Consultant.
The answer
In the NEC4 main contract it lets the Client add to the list. On an NEC subcontract, read the Client as your main contractor, and check what your Contract Data adds. One Contract Data entry lets extra compensation events be stated. Anything written there counts the same as the 20 numbered paragraphs, with no need for a Z clause. Typical additions are risks the other side is better placed to carry. Examples are a utility company's delay beyond a stated date, or contamination beyond a stated level. But the wording is whatever was written. An event drafted loosely is generous. One written with conditions is only as wide as those conditions. A blank entry adds nothing. To rely on the clause, show the Contract Data entry, that what happened is the event it describes, and that any conditions in it are met. Notify under clause 61.3 within 8 weeks of becoming aware it has happened. The exception is an entry describing an event that comes from the other side's own instruction or decision, which it should notify. The change to the Prices, your contract price, is assessed under clause 63.1, exactly as for the numbered events. It is the effect on actual Defined Cost up to the notification and forecast Defined Cost after it, plus the Fee. The decision under clause 61.4 applies in the same way. Two things go wrong most. You assume the standard list is the whole list and never read the Contract Data, so an event the other side expressly accepted is never notified. Or an extra event overlaps a numbered paragraph, and you notify under the wrong one. Any delay to the Completion Date is assessed separately under clause 63, and that is a job for your planner.
Example
Illustrative example. The scenario and figures are invented.
The facts
A highways subcontractor's Contract Data states an extra compensation event: a utility company's diversion of its apparatus not finished by its date on the Accepted Programme. The gas diversion across the new roundabout finishes 23 days after the programme date.
What happens
- An early warning goes out when the utility company first reports slippage.
- The subcontractor checks the Contract Data entry, and confirms the diversion and the date match its wording.
- It notifies the event under clause 61.3 the day after the programme date passes.
- The quotation assesses the paving gang and plant that could neither start on the roundabout nor be released, at £1,315 a day for 23 days. That is £30,245 of Defined Cost, under clause 63.1.
- The Fee is added at the Contract Data percentage, and the programme effect is shown for separate assessment.
The outcome
The compensation event carries £30,245 of Defined Cost plus the Fee, with the programme effect assessed separately.
To have a refused event tested against the clause it falls under and pressed to implementation, see our Compensation Event Claim service.