Clause 60.1(19): The NEC Prevention Event Explained

Clause 60.1(19) makes it a compensation event when something neither Party could prevent, and so unlikely at the Contract Date that an experienced contractor couldn't reasonably have allowed for it, stops the Contractor completing the works or completing by the date on the Accepted Programme. This is NEC's version of force majeure, but with a difference: it's a priced event, so the Contractor gets both time and money.

The entry applies in NEC3 and NEC4 ECC. NEC4 specifies "the whole of the works". Both also have clause 19.1, which sets out what the Project Manager does when such an event occurs. For how this compares with other contracts, see force majeure under NEC.

What triggers it: every test has to be met

Test	What it asks	What fails it
It stops completion	Does it stop the Contractor finishing the works, or finishing by the planned Completion date on the Accepted Programme?	Disruption and cost alone, or a short interruption that float absorbs
Neither Party could prevent it	Was it out of both Parties' hands?	A problem the Contractor could have avoided by acting differently
Very unlikely at the Contract Date	Would an experienced contractor have judged the chance so small that allowing for it was unreasonable?	Ordinary commercial or construction risks
Not another compensation event	Does any other entry on the list cover it?	Weather, ground and Client faults, each with its own entry

Typical failures

A Subcontractor's insolvency. It's a known business risk, and often preventable by choosing well.
Price rises and shortages. Being more expensive doesn't stop anything, and these are risks that experienced contractors consider.
Weather that fails the 60.1(13) test. The contract has a specific measure for weather, and treating a near-miss as a prevention event undermines that.
Bad ground that fails 60.1(12). This has the same problem.

What's left is rare: a sudden, major event outside the Site with no other contractual home. Whether a specific event passes is a judgement on the facts, and past experience of events like it matters. Don't assume anything about an event because someone said it applied on another job.

How it is usually evidenced

Independent records of the event, such as notices from public authorities or road closure orders.
Why neither Party could have done anything to prevent it.
What an experienced contractor would have thought at the Contract Date. This might draw on the local history of such events, the Site Information and the tender risk register.
The programme logic showing that it actually stops planned Completion.
The steps taken to reduce the effect.

Worked example

A fictional coastal defence scheme on Option C, with illustrative figures. A section of the only public road to the Site collapses into the sea after an undetected cavity gives way. It's outside the Site, so 60.1(12) isn't available. The highway authority closes the road for nine weeks. Rock armour deliveries stop altogether, as there's no other road, and the only alternative, a barge, takes three weeks to arrange. Rock armour is on the critical path, so the Contractor can no longer finish by the planned Completion date.

The Contractor notifies under 60.1(19). The Project Manager accepts the event and, under clause 19.1, instructs the Contractor to arrange the barge and carry on with other work.

Effect	Defined Cost
Barge hire and double-handling of rock armour	£148,000
Standing and redeployed plant during the three weeks to set up the barge	£42,000
Time-related cost for three weeks' delay to planned Completion	£60,000
Total (the Fee is then added)	£250,000

If a second road had been open, at the cost of a longer journey, deliveries would have carried on and the test that completion was stopped wouldn't be met. The Contractor would carry the cost of the longer route, as disruption alone isn't enough.

How it is assessed

This is a Contractor-notified event, so clause 61.3 applies, and the dividing date is the date of notification. Since these events are by nature uncertain, assumptions under 61.6 are common, with later corrections as the real length becomes clear. Under 63.9, a competent, prompt reaction is assumed. Reasonable costs of working around the event count, so long as they're properly incurred.

Termination

If the forecast delay to Completion from such an event is over thirteen weeks, clause 91.7 gives a right to terminate (reason R21). Under the ECC, this is the Client's right. See termination reasons and check the wording in your contract, including any amendments.

What people get wrong

Treating it as relief without money. Readers from other forms expect time only. Here, the same assessment applies as for any other event, which is why the test is hard to meet. See also compensation events and relief events.
Testing it first. Check every other entry before you reach this one, since it applies only where they don't.
Judging likelihood with hindsight. What happened last year doesn't decide what an experienced contractor would have thought before it.
Assuming a Z clause hasn't touched it. Amendments can change or remove this entry, so read your Z clauses.

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This guide is general information in our own words, not legal advice. Your contract and its Contract Data always govern. NEC, NEC3 and NEC4 are trade marks of Thomas Telford Ltd; Contract Status is not affiliated with or endorsed by NEC.