{"id":116943,"date":"2022-10-19T15:27:42","date_gmt":"2022-10-19T14:27:42","guid":{"rendered":"https:\/\/www.pbctoday.co.uk\/news\/?p=116943"},"modified":"2022-10-19T15:27:42","modified_gmt":"2022-10-19T14:27:42","slug":"nec-contracts-maintaining-good-communications","status":"publish","type":"post","link":"https:\/\/www.pbctoday.co.uk\/news\/planning-construction-news\/nec-contracts-maintaining-good-communications\/116943\/","title":{"rendered":"NEC Contracts: Maintaining Good Communications \u2013 Part 2"},"content":{"rendered":"<h2>In Part 2 of our series covering communications in NEC Contracts, John Elven, Senior Consultant at <a href=\"https:\/\/arbicon.co.uk\/services\" target=\"_blank\" rel=\"noopener noreferrer\">Arbicon<\/a>, discusses the importance of maintaining good communications under the requirements of NEC Contracts as a means of promoting dispute avoidance, focussing on NEC 4 clause 13<\/h2>\n<p>This article continues to consider the importance of maintaining good communications in accordance with the requirements of <a href=\"https:\/\/www.pbctoday.co.uk\/news\/planning-construction-news\/the-importance-of-maintaining-good-communications-in-nec-contracts-to-avoid-disputes\/115689\/\" target=\"_blank\" rel=\"noopener noreferrer\">NEC Contracts to promote dispute avoidance<\/a>.<\/p>\n<p>Having reviewed NEC 4 clauses 13.1 to 13.3 in Part 1, we have already considered (amongst other things):<\/p>\n<p>\u2022 The requirement for all communications to be in writing.<br \/>\n\u2022 The need to use the communication system specified in the Scope.<br \/>\n\u2022 The need to provide prompt replies to a communication.<\/p>\n<h3>What can be expected concerning the reply to communication?<\/h3>\n<p>NEC 4 clause 13.4 then proceeds to explain what can be expected concerning the reply to communication. It states: \u201cThe Project Manager replies to a communication submitted or resubmitted by the Contractor for acceptance.<\/p>\n<p>&#8220;If the reply is not acceptance, the Project Manager states the reasons in sufficient detail to enable the Contractor to correct the matter. The Contractor resubmits the communication within the period for reply taking account of these reasons. A reason for withholding acceptance is that more information is needed in order to assess the Contractor\u2019s submission fully.\u201d<\/p>\n<p>In NEC 3, this clause required that \u201cIf his reply is not acceptance, the Project Manager states his reasons\u2026\u201d. Unfortunately, NEC 3 did not specify the extent to which the Project Manager should explain his reasons for rejection.<\/p>\n<p>However, NEC 4 has rectified this by requiring the Project Manager to state its \u201creasons in sufficient detail to enable the Contractor to correct the matter.\u201d<\/p>\n<h3>Reasons for withholding acceptance<\/h3>\n<p>Of course, the interpretation of \u2018sufficient detail\u2019 is likely to be subjective in practice, but it is hoped that in the NEC\u2019s \u2018spirit of mutual trust and co-operation,\u2019 the Project Manager will provide enough information to enable the Contractor to \u2018resubmit the communication\u2019 (\u2018within the period for reply\u2019) and to take into consideration the Project Manager\u2019s reasons for rejection.<\/p>\n<p>Equally, noting that clause 13.4 also states that a \u2018reason for withholding acceptance\u2019 could be because the Project Manager needs more information, it makes sense that the Contractor should be expected to provide enough information so that the Project Manager can accept its submission.<\/p>\n<p>An example of this is concerning the provision of a quotation by the Contractor for a compensation event. If that compensation event is likely to impact upon the \u2018programme for remaining work,\u2019 NEC 4 clause 62.2 requires that the Contractor \u2018includes the alterations to the Accepted Programme in the quotation.\u2019<\/p>\n<p>If the Contractor has neglected to provide any evidence to support its claim for additional time, or to substantiate its actual\/anticipated losses (ref. Defined Cost), it makes sense that the Project Manager could reject the quotation and request further information.<\/p>\n<p>The consequent delay in accepting the quotation will likely affect the Contractor\u2019s cash flow and could have implications concerning future programmes being offered for acceptance. However, if the Contractor provides the information the contract requires, this should enable the Project Manager to accept the \u2018communication\u2019 promptly and thereby alleviate the Contractor\u2019s concerns ref. cash flow, etc.<\/p>\n<p>In respect of the \u2018timing\u2019 for \u2018replies to a communication,\u2019 and further to my comments in Part 1 of this article (which considered the \u2018period for reply\u2019 referred to in NEC 4 clause 13.3), clause 13.5 goes on to state:<\/p>\n<p>\u201cThe Project Manager may extend the period of reply to a communication if the Project Manager and the Contractor agree to the extension before the reply is due. The Project Manager informs the Contractor of the extension which has been agreed.\u201d<\/p>\n<p>This would appear to be reasonable where, for example, additional time may be required to fully understand and incorporate numerous changes to the scope.<\/p>\n<h3>Examples of the required certification related to payment<\/h3>\n<p>NEC 4 clause 13.6 deals with issuing certificates by the Project Manager and the Supervisor and specifies to whom these should be issued \u2013 examples of the required certification related to payment (clause 51.1), and Defects (clause 44.3).<\/p>\n<p>Another example relates to the Project Manager having 1-week within which to certify Completion after the \u2018date of Completion\u2019 (clause 30.2; noting that this also applies to Sectional Completions \u2013 see clause X5.1). In this case, the Project Manager issues the certificate \u2018to the Client and the Contractor.\u2019<\/p>\n<p>Another important requirement in respect of communications is provided at NEC 4 clause 13.7, where it states:<\/p>\n<p>\u201cA notification or certificate which the contract requires is communicated separately from other communications.\u201d<\/p>\n<p>In a previous article, <a href=\"https:\/\/www.pbctoday.co.uk\/news\/planning-construction-news\/the-importance-of-maintaining-good-communications-in-nec-contracts-to-avoid-disputes\/115689\/\" target=\"_blank\" rel=\"noopener noreferrer\">NEC Contracts \u2013 Getting it Right from the Start<\/a>, I noted the importance of acting \u2018as stated in the contract.\u2019 As such, it is imperative that NEC users provide all notifications and certificates that the contract requires. For example, a notification for an early warning matter is clearly different to the notification needed for a compensation event and hence these should be communicated separately (NEC 4 clauses 15.1, 61.1 &amp; 61.3 refer).<\/p>\n<p>This article would not be complete without mentioning NEC 4 clause 13.8 which states that:<\/p>\n<p>\u201cThe Project Manager may withhold acceptance of a submission by the Contractor. Withholding acceptance for a reason stated in these conditions of contract is not a compensation event.\u201d<\/p>\n<p>Having already considered a basis for withholding acceptance (see clause 13.4 above), this clause makes it clear that the withholding of acceptance for a reason stated in the contract is not a compensation event.<\/p>\n<p>However, NEC 4 clause 60.1(9) does include a compensation event where, \u2018The Project Manager withholds an acceptance\u2026 for a reason not stated in the contract.\u2019 [Emphasis added.] It is incumbent upon the Project Manager to ensure that there is a sound contractual basis for rejecting any of the Contractor\u2019s submissions.<\/p>\n<p>I hope that you have enjoyed my brief overview of NEC 4 clause 13, and that you have gained a greater appreciation of the importance of maintaining good and timely communications to ensure that you protect your position and avoid disputes.<\/p>\n<p>If you need any advice on an NEC Contract, require any clauses to be checked or would like a contract written, please use our contact form or call our offices below:<\/p>\n<p><strong>01733 233737 Peterborough<\/strong><br \/>\n<strong>0207 406 1494 London<\/strong><br \/>\n<strong>0121 262 4086 Birmingham<\/strong><\/p>\n<p><strong><a href=\"https:\/\/www.pbctoday.co.uk\/news\/stakeholders\/arbicon-construction-claims-consultancy-specialising-in-adjudication-and-alternative-dispute-resolution-adr\/108100\/\" target=\"_blank\" rel=\"noopener noreferrer\">Arbicon<\/a><\/strong><\/p>\n<div class=\"mk-custom-module-container\">\n<\/div>","protected":false},"excerpt":{"rendered":"<p>In Part 2 of our series covering communications in NEC Contracts, John Elven, Senior Consultant at Arbicon, discusses the importance of maintaining good communications under the requirements of NEC Contracts as a means of promoting dispute avoidance, focussing on NEC 4 clause 13.<\/p>\n","protected":false},"author":21,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[304],"tags":[853,88176,464,172727,728,122271],"stakeholder_rel_tag":[172375],"contributor_rel_tag":[],"class_list":{"0":"post-116943","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-planning-construction-news","7":"tag-adjudication","8":"tag-construction-disputes","9":"tag-contributor-profile","10":"tag-featured","11":"tag-quantity-surveyors","12":"tag-sh-arbicon","13":"stakeholder_rel_tag-arbicon"},"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.9 (Yoast SEO v26.9) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>NEC Contracts: Maintaining Good Communications \u2013 Part 2<\/title>\n<meta name=\"description\" content=\"John Elven discusses the importance of maintaining good communications under the requirements of NEC Contracts as a means of promoting dispute avoidance\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.pbctoday.co.uk\/news\/planning-construction-news\/nec-contracts-maintaining-good-communications\/116943\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"NEC Contracts: Maintaining Good Communications \u2013 Part 2\" \/>\n<meta property=\"og:description\" content=\"In Part 2 of our series covering communications in NEC Contracts, John Elven, Senior Consultant at Arbicon, discusses the importance of maintaining good communications under the requirements of NEC Contracts as a means of promoting dispute avoidance, focussing on NEC 4 clause 13\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.pbctoday.co.uk\/news\/planning-construction-news\/nec-contracts-maintaining-good-communications\/116943\/\" \/>\n<meta property=\"og:site_name\" content=\"Planning, Building &amp; 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