Yes, usually. A client breach under NEC that no other event covers is a compensation event under clause 60.1(18), so your remedy is a change to the Prices and dates through the normal procedure, and the eight-week bar in 61.3 applies.
The deciding questions are whether there really is a breach by the Client, and whether a more specific event fits first. The entry has the same number in NEC3 and NEC4 ECC, and the NEC4 subcontract's version covers a breach by the Contractor.
What to do now
- Diarise eight weeks from when you became aware of the breach (seven in the NEC4 subcontract). Assume it applies. A breach by the Client isn't a communication from the Project Manager, so the exception in 61.3 for instructions and the like won't usually help.
- Name the obligation. Identify the clause or Scope entry that the Client has failed to meet. Without that, there's no breach to rely on.
- Test the specific events first, using the table below. A specific event has a clearer test.
- Notify under 61.3, citing 60.1(18) and any other event in the alternative.
- Measure the effect on Defined Cost, Completion or a Key Date. Under 61.4, an event with no such effect doesn't change anything.
- Give an early warning if the breach is continuing, so that it can be dealt with.
Which route applies?
| What the Client's side did | Try first |
|---|---|
| Late access to the Site | 60.1(2) |
| Failed to provide something by the Accepted Programme date | 60.1(3) |
| Its other contractors worked outside the programme or the Scope's conditions | 60.1(5) |
| Project Manager or Supervisor didn't reply in time | 60.1(6) |
| Project Manager reversed a decision | 60.1(8) |
| Payment late | Interest under 51.2, and the Construction Act rights. Don't use 60.1(18) as the primary route |
| Anything else that the contract requires of the Client | 60.1(18) |
The guide to compensation event 60.1(18) explains how the entry works. This page is about what to do when you're stuck.
A fictional example
The Scope requires the Client to keep a shared haul road open for the Contractor's use. The Client's estates team closes it for three weeks for its own reasons. The Accepted Programme shows no date for the road, so 60.1(3) is doubtful, and the road isn't a part of the Site access in the Contract Data. The Contractor notifies 60.1(18) on day four, and keeps records of the longer route. Illustrative result: £22,000 and five days. The real work is in proving the Scope obligation and the extra haulage.
When the fault isn't really the Client's
Things that often feel like a breach aren't necessarily one. Examples include a Project Manager using a contract power you don't like, a harsh but correct assessment, or a Client refusing to agree a change to the contract. Clause 10 sets the standard for how people act, but it doesn't turn each grievance into an event: see what clause 10 actually requires.
Whether a failure by the Project Manager counts as a breach by the Client is a legal question. The entry itself speaks of the Client. If there's a lot of money on it, take advice. An Adjudicator can review an action or inaction by the Project Manager without needing that answered first.
What you can get
The contract says that changes to the Prices and dates are the Parties' only rights for a compensation event (63.6 in the NEC4 subcontract text, 63.4 in NEC3 ECC). So once it's an event, expect it to be assessed on Defined Cost plus the Fee, not on a general damages basis. Loss of profit elsewhere may therefore be out of reach. If your loss isn't captured, or the Client's wrongdoing falls outside the contract, take advice about other legal remedies.
Sample notification
"We notify the following as a compensation event under clause 60.1(18). The Scope at [reference] requires the Client to [obligation]. On [date] the Client [what happened]. We became aware of this on [date]. No other compensation event applies; in the alternative, we rely on clause 60.1([x]). This affects [Defined Cost, Completion or a Key Date] because [reason]."
The likely reply
The Project Manager may reply that there's no obligation, that the event is a different one with a test you can't meet, that you've no effect to show, or that you're out of time. Reply to each in turn, and if it remains unresolved, use your W Option. When the PM rejects without a reason helps with a thin reply, and the NEC questions hub has more.
Related guides
- NEC Questions Answered: Real Situations on Site
- Can We Still Refer a Dispute After the Time Limit?
- Should We Go to Adjudication or Keep Negotiating?
- A New Project Manager Is Reversing Earlier Decisions
- Can a Contractor Terminate an NEC Contract?
- Our Contractor Has Gone Insolvent: What Does the Client Do?
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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.