{
  "query": "NEC4 contract NCE auto-approval implications and quotation review best practices",
  "raw_results": [
    {
      "url": "https://gmhplanning.co.uk/nec-downloads/nec4-ecc-detailed-review-changes-nec3/",
      "title": "NEC4 ECC - Detailed review of changes from NEC3 - GMH Planning",
      "content": "Clause 36.1 – Project Manager can no longer instruct quote for acceleration. Either Contractor/Project Manager can propose. If BOTH sides are prepared to consider the change, then the Project Manager can instruct a quotation to accelerate. Now there are timescales of up to three weeks to produce quotation by Contractor and three weeks for the Project Manager to reply. Also now includes the response to quotation as being a core clause, rather than previously being lost within the main option clauses. [...] Two new compensation events:\n  + Clause 60.1(20) – Project Manager notifies the Contractor that a quotation for a proposed instruction is not accepted.\n  + Clause 60.1(21) – additional compensation events stated in contract data part 1.\n Clause 61.1 – previous wording split now across 61.1 and 61.2.\n Clause 61.1 states that for compensation events resulting from Project Manager instruction, the Project Manager notifies the compensation event at the time of giving the quotation. It no longer states as last sentence “Contractor puts decision into effect”. Don’t think this changes much but it was a nice point of clarification previously. [...] \\ Clause 11.2(23) – Defined Cost no longer excludes the cost of preparing quotations for compensation events.\n \\ Clause 11.2(28) – New term for People Rates which are included within contract data part 2.\n Clause 55.1 – extra line to say if activities on the Activity Schedule do not relate to Scope, Contractor corrects activity schedule.\n \\ Clause 63.12 confirms that changes to Client Scope proposed by Contractor and accepted, the Prices are reduced by an amount calculated by applying the value engineering percentage in contract data part 1 (Clients need to be careful they get this right way round as the Prices are reduced by the percentage amount stated in contract data i.e. if you wanted to give the Contractor 30% benefit the percentage should be 70%). This is unique to options A&B.",
      "score": 0.6350646,
      "raw_content": null
    },
    {
      "url": "https://sypro.co.uk/blogs/how-to-clarify-effectively-instructions-and-proposed-instructions-under-nec4-ecc/",
      "title": "Instructions and Proposed Instructions under NEC4 ECC - Sypro",
      "content": "For straight forward work, the NEC4 ECC gives Project Managers the authority to issue instructions under clause 14.3, allowing them to change the Scope of the works. However, where that change affects time or cost, it must also be notified as a compensation event under clause 61.1. This is then followed by a quotation request using clause 61.2. Missing any of these steps – or doing them out of order – risks confusion and non-compliance. One common mistake Dr Kings highlighted is when a compensation event is notified before the actual instruction has been issued, or when no instruction is given at all. In both cases, the communication lacks contractual standing. Both steps must be followed. [...] This is where digital contract management systems add real value. Platforms like ours provide time-stamped, structured communication threads and allow instructions to be clearly documented and linked to related events. That means there’s never any ambiguity about what was instructed, when, or by whom. And if a dispute arises, there’s a reliable audit trail to fall back on.\n\n### When to propose before you instruct\n\nFor more complex or high-risk changes, NEC4 provides another useful mechanism: the proposed instruction. Clause 65.1 allows Project Managers to request a quotation for a potential change before deciding whether to issue the instruction. It’s a ‘look before you leap’ approach – giving both parties a chance to assess the implications before committing to the work. [...] If the contractor misses the quotation deadline, the Project Manager is required to make their own assessment. If the Project Manager fails to respond within the agreed timeframe – and no extension has been granted – the quotation is automatically deemed accepted (if the reminder has been served by the contractor). These timelines are there to keep things moving and avoid disputes caused by inaction or ambiguity.\n\n### Bringing it all together with Sypro",
      "score": 0.58664185,
      "raw_content": null
    },
    {
      "url": "https://reachback.builtintelligence.com/t/nec4-option-c-quotes/21811",
      "title": "NEC4 Option C quotes - Compensation Events - ReachBack",
      "content": "If the PM really sticks to the requirements of Cl.52.1, then the Contractor may down tools for weeks while a procurement exercise is undertaken, that would not suit anyone. If you consider the quotation too high then talk to the Contractor and request a new submission of the quotation as a starter.\n\nTo protect from this in the future, why not amend the Project Managers Instruction to include “no works to commence until a quotation has been agreed by all parties, in writing”.\n\nCould this form a “disallowed cost”? possibly if there was a stated “procurement policy” in the Scope and the Contractor did not comply with it. I think that’s going out on a limb as it would cause very bad feeling with the Contractor. [...] Cl.52.1 (payment) requires Defined Cost to be rates at “open market, or competitively tendered prices”. The PM needs to take a view on this, it’s not reasonable to always go out to the market. If the PM feels the rates used are near to “open market” rates then accept the quote. If the PM can demonstrate the quotation is wrongly assessed they can carry out their own assessment. A note of caution! a quote being on the high side is not necessarily “wrongly assessed”. Value for money is subjective and changes from person to person and on different projects.",
      "score": 0.5128152,
      "raw_content": null
    },
    {
      "url": "https://www.necplanningsolutions.co.uk/post/nec4-compensation-events-how-to-get-quotations-agreed",
      "title": "NEC4 Compensation Events: How to Get Quotations Agreed",
      "content": "A quick “do this next week” checklist\n\n1. Put every CE into a tracker with four dates: awareness date, notification date, quotation due date, PM reply due date.\n2. Standardise the submission format. Same decision pack layout every time, no exceptions.\n3. Make the programme extract the centrepiece. One impacted chain, clearly shown, with the interfaces that matter.\n4. Keep assumptions short and explicit. If an assumption is critical, it must be visible, not hidden in a spreadsheet.\n5. Run a weekly CE triage slot. Fifteen minutes is enough if the pack is consistent. [...] Why NEC4 Compensation Events drift\n\nFirst, time bars are real. Under clause 61.3, many contractor-notified compensation events can be time-barred if they are not notified within 8 weeks of the contractor becoming aware that the event has happened.\n\nSecond, people use the wrong programme reference. The accepted programme “current at the dividing date” is the anchor for assessment (clause 63.5), and a later revised programme can be irrelevant if it was issued after the dividing date.\n\nThird, quotations are often submitted as cost spreadsheets plus a narrative. That makes it hard for the PM to test time impact and assumptions quickly, so the response becomes “revise and resubmit”.\n\nThe simplified NEC4 Compensation Events Guide [...] |  |  |  |  |\n ---  --- |\n| Step | What the contract clock is driving | What you issue | Output the PM can act on |\n| 1. Notify the CE | Protect time bar and start the formal process | CE notice with event, dates, clause trigger, affected areas | Clear record that the CE is live |\n| 2. Build the quotation | Produce a forecast-based quotation (time + cost) | Quotation + assumptions + programme extract (impacted chain) | A “yes / no / revise” decision, not a debate |\n| 3. PM reply | Keep momentum and avoid silence | Short cover note stating what decision is required and by when | Accept / ask to revise / PM assesses |",
      "score": 0.50065976,
      "raw_content": null
    },
    {
      "url": "https://www.neccontract.com/news/nec4-ecc-compensation-event-assessment-a-worked-example?srsltid=AfmBOoo05_O7raMv-6oX1gi2qvbelggExb9iojIFUK6TI8HzJyK0AI-J",
      "title": "NEC4 ECC compensation event assessment – a worked example",
      "content": "Under NEC4 ECC, quotations for compensation events should detail how much additional money the contractor should be compensated as well as how much additional time it is entitled to, which in either case could be zero or, in the case of cost, could be negative. There is often a misconception that compensation events only deal with cost because that is what is generally associated with the terms ‘compensate’ and ‘quotation’. However, unlike other forms of contract, including other NEC4 contracts, compensation events under NEC4 ECC deal with both time and money. [...] Say a contractor is building a new library under NEC4 ECC Option A (priced contract with activity schedule). The client’s scope includes a new storage room specifying type A shelving. The tendered price in the activity schedule to supply and install this shelving is £60,000.  \n  \nSix months into the project the project manager instructs a change to the scope, deleting the type A shelving and replacing it with type B shelving. For completeness, it is given that the project manager has correctly notified a compensation event and instructed quotations without an agreement to use rates or lump sums (clause 63.2).",
      "score": 0.45391592,
      "raw_content": null
    }
  ],
  "formatted": "Source: NEC4 ECC - Detailed review of changes from NEC3 - GMH Planning\nURL: https://gmhplanning.co.uk/nec-downloads/nec4-ecc-detailed-review-changes-nec3/\nClause 36.1 – Project Manager can no longer instruct quote for acceleration. Either Contractor/Project Manager can propose. If BOTH sides are prepared to consider the change, then the Project Manager can instruct a quotation to accelerate. Now there are timescales of up to three weeks to produce quotation by Contractor and three weeks for the Project Manager to reply. Also now includes the response to quotation as being a core clause, rather than previously being lost within the main option clauses. [...] Two new compensation events: + Clause 60.1(20) – Project Manager notifies the Contractor that a quotation for a proposed instruction is not accepted. + Clause 60.1(21) – additional compensation events stated in contract data part 1. Clause 61.1 – previous wording split now across 61.1 and 61.2. Clause 61.1 states that for compensation events resulting from Project Manager instruction, the Project Manager notifies the compensation event at the time of giving the quotation. It no longer states as last sentence “Contractor puts decision into effect”. Don’t think this changes much but it was a nice point of clarification previously. [...] \\ Clause 11.2(23) – Defined Cost no longer excludes the cost of preparing quotations for compensation events. \\ Clause 11.2(28) – New term for People Rates which are included within contract data part 2. Clause 55.1 – extra line to say if activities on the Activity Schedule do not relate to Scope, Contractor corrects activity schedule. \\ Clause 63.12 confirms that changes to Client Scope proposed by Contractor and accepted, the Prices are reduced by an amount calculated by applying the value engineering percentage in contract data part 1 (Clients need to be careful they get this right way round as the Prices are reduced by the percentage \n\n---\n\nSource: Instructions and Proposed Instructions under NEC4 ECC - Sypro\nURL: https://sypro.co.uk/blogs/how-to-clarify-effectively-instructions-and-proposed-instructions-under-nec4-ecc/\nFor straight forward work, the NEC4 ECC gives Project Managers the authority to issue instructions under clause 14.3, allowing them to change the Scope of the works. However, where that change affects time or cost, it must also be notified as a compensation event under clause 61.1. This is then followed by a quotation request using clause 61.2. Missing any of these steps – or doing them out of order – risks confusion and non-compliance. One common mistake Dr Kings highlighted is when a compensation event is notified before the actual instruction has been issued, or when no instruction is given at all. In both cases, the communication lacks contractual standing. Both steps must be followed. [...] This is where digital contract management systems add real value. Platforms like ours provide time-stamped, structured communication threads and allow instructions to be clearly documented and linked to related events. That means there’s never any ambiguity about what was instructed, when, or by whom. And if a dispute arises, there’s a reliable audit trail to fall back on. ### When to propose before you instruct For more complex or high-risk changes, NEC4 provides another useful mechanism: the proposed instruction. Clause 65.1 allows Project Managers to request a quotation for a potential change before deciding whether to issue the instruction. It’s a ‘look before you leap’ approach – giving both parties a chance to assess the implications before committing to the work. [...] If the contractor misses the quotation deadline, the Project Manager is required to make their own assessment. If the Project Manager fails to respond within the agreed timeframe – and no extension has been granted – the quotation is automatically deemed accepted (if the reminder has been served by the cont\n\n---\n\nSource: NEC4 Option C quotes - Compensation Events - ReachBack\nURL: https://reachback.builtintelligence.com/t/nec4-option-c-quotes/21811\nIf the PM really sticks to the requirements of Cl.52.1, then the Contractor may down tools for weeks while a procurement exercise is undertaken, that would not suit anyone. If you consider the quotation too high then talk to the Contractor and request a new submission of the quotation as a starter. To protect from this in the future, why not amend the Project Managers Instruction to include “no works to commence until a quotation has been agreed by all parties, in writing”. Could this form a “disallowed cost”? possibly if there was a stated “procurement policy” in the Scope and the Contractor did not comply with it. I think that’s going out on a limb as it would cause very bad feeling with the Contractor. [...] Cl.52.1 (payment) requires Defined Cost to be rates at “open market, or competitively tendered prices”. The PM needs to take a view on this, it’s not reasonable to always go out to the market. If the PM feels the rates used are near to “open market” rates then accept the quote. If the PM can demonstrate the quotation is wrongly assessed they can carry out their own assessment. A note of caution! a quote being on the high side is not necessarily “wrongly assessed”. Value for money is subjective and changes from person to person and on different projects.\n\n---\n\nSource: NEC4 Compensation Events: How to Get Quotations Agreed\nURL: https://www.necplanningsolutions.co.uk/post/nec4-compensation-events-how-to-get-quotations-agreed\nA quick “do this next week” checklist 1. Put every CE into a tracker with four dates: awareness date, notification date, quotation due date, PM reply due date. 2. Standardise the submission format. Same decision pack layout every time, no exceptions. 3. Make the programme extract the centrepiece. One impacted chain, clearly shown, with the interfaces that matter. 4. Keep assumptions short and explicit. If an assumption is critical, it must be visible, not hidden in a spreadsheet. 5. Run a weekly CE triage slot. Fifteen minutes is enough if the pack is consistent. [...] Why NEC4 Compensation Events drift First, time bars are real. Under clause 61.3, many contractor-notified compensation events can be time-barred if they are not notified within 8 weeks of the contractor becoming aware that the event has happened. Second, people use the wrong programme reference. The accepted programme “current at the dividing date” is the anchor for assessment (clause 63.5), and a later revised programme can be irrelevant if it was issued after the dividing date. Third, quotations are often submitted as cost spreadsheets plus a narrative. That makes it hard for the PM to test time impact and assumptions quickly, so the response becomes “revise and resubmit”. The simplified NEC4 Compensation Events Guide [...] | | | | | --- --- | | Step | What the contract clock is driving | What you issue | Output the PM can act on | | 1. Notify the CE | Protect time bar and start the formal process | CE notice with event, dates, clause trigger, affected areas | Clear record that the CE is live | | 2. Build the quotation | Produce a forecast-based quotation (time + cost) | Quotation + assumptions + programme extract (impacted chain) | A “yes / no / revise” decision, not a debate | | 3. PM reply | Keep mom\n\n---\n\nSource: NEC4 ECC compensation event assessment – a worked example\nURL: https://www.neccontract.com/news/nec4-ecc-compensation-event-assessment-a-worked-example?srsltid=AfmBOoo05_O7raMv-6oX1gi2qvbelggExb9iojIFUK6TI8HzJyK0AI-J\nUnder NEC4 ECC, quotations for compensation events should detail how much additional money the contractor should be compensated as well as how much additional time it is entitled to, which in either case could be zero or, in the case of cost, could be negative. There is often a misconception that compensation events only deal with cost because that is what is generally associated with the terms ‘compensate’ and ‘quotation’. However, unlike other forms of contract, including other NEC4 contracts, compensation events under NEC4 ECC deal with both time and money. [...] Say a contractor is building a new library under NEC4 ECC Option A (priced contract with activity schedule). The client’s scope includes a new storage room specifying type A shelving. The tendered price in the activity schedule to supply and install this shelving is £60,000. Six months into the project the project manager instructs a change to the scope, deleting the type A shelving and replacing it with type B shelving. For completeness, it is given that the project manager has correctly notified a compensation event and instructed quotations without an agreement to use rates or lump sums (clause 63.2)."
}