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How does NEC4 clause 62 work?

You quote within 3 weeks, the reply is due within 2 weeks, and if none comes after you notify the failure, your quotation is treated as accepted.

Updated: . By Jack Butler-Kettle, Construction Claims Consultant.

For a plain checklist of the three parts, see what an NEC compensation event quotation should contain.

For the dates worked through on an example, see how long the contractor has to submit a compensation event quotation.

The answer

Those are the periods in the NEC4 main contract, and your subcontract may set different ones. Clause 62 is the quotation stage, and it runs to a timetable either side can lose by ignoring. Under clause 62.2, a quotation sets out the proposed change to the Prices and any delay to the Completion Date and Key Dates. It shows how you worked them out. Where the programme is affected, it shows the changes to the Accepted Programme. You can also be asked to quote for other ways of dealing with the event. Under clause 62.3, you submit the quotation within 3 weeks of being asked, and the reply is due within 2 weeks of your submission. The reply accepts it, asks for a revised quotation, or says the other side will make its own assessment. Under clause 62.4, a request for a revised quotation must give reasons. Under clause 62.5, both periods can be extended if both sides agree before the period ends. Clause 62.6 deals with silence. If no reply comes in time, you can notify the failure. If there is still no reply within 2 weeks of that notice, the quotation is treated as accepted. The money is assessed on the clause 63 rules. So the quotation is a forecast of Defined Cost plus the Fee, not a claim built from invoices. The time element sits with the programme and your planner, not the QS. Three things go wrong. Quotations go in as a bare total with no details, which invites a request to revise. Extensions are asked for after the period has ended, when the clause no longer allows them. And subcontractors who get no reply wait instead of notifying the failure, so the quotation sits unpriced until the final account.

Example

Illustrative example. The scenario and figures are invented.

The facts

Under the unamended NEC4 periods, a quotation is asked for an instruction adding a small retaining wall. The request arrives on a Monday, and the quotation is due 3 weeks from that day.

What happens

  1. The quotation shows forecast Defined Cost of £40,000 from the Schedule of Cost Components, and the Fee at the Contract Data percentage, a total of £44,000.
  2. It states the assumptions relied on, and attaches a programme extract showing no change to planned Completion.
  3. The reply is then due within 2 weeks.
  4. If the reply asks for a revision because the wall's founding depth was wrongly assumed, it must give that reason, and the quotation is resubmitted.
  5. If no reply comes at all, the failure is notified.

The outcome

If 2 more weeks pass in silence after that notice, the quotation is treated as accepted at £44,000.

Our Compensation Event Claim checks a rejected or reduced quotation against clause 62.2 and the cost records.