Professional Services Contract

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This contract should be used for the appointment of a supplier to
provide professional services

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An NEC document

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June 2005

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E OGC endorsement of NEC3
OGC advises public sector procurers that the form of contract used has to be selected
according to the objectives of the project, aiming to satisfy the
Achieving Excellence in Construction (AEC) principles.

This edition of the NEC (NEC3) complies fully with the AEC principles. OGC recommends
the use of NEC3 by public sector construction procurers on their construction projects.
 NEC is a division of Thomas Telford Ltd, which is a wholly owned subsidiary of
the Institution of Civil Engineers (ICE), the owner and developer of the NEC.
The NEC is a family of standard contracts, each of which has these
characteristics:
. Its use stimulates good management of the relationship between the two
parties to the contract and, hence, of the work included in the contract.
. It can be used in a wide variety of commercial situations, for a wide
variety of types of work and in any location.
. It is a clear and simple document – using language and a structure
which are straightforward and easily understood.
NEC3 Professional Services Contract is one of the NEC family and is
consistent with all other NEC3 documents. Also available are the Guidance

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Notes and Flow Charts.

ISBN (complete box set) 0 7277 3382 6

ISBN (this document) 0 7277 3370 2

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ISBN (Guidance Notes and Flow Charts) 0 7277 3371 0

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First edition 1994

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Second edition 1998
Third edition June 2005

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Cover photo, Golden Jubilee Bridge, courtesy of City of Westminster

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987654321

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British Library Cataloguing in Publication Data for this publication is available
from the British Library.

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All rights, including translation, reserved. The owner of this document may
reproduce the Contract Data for the purpose of obtaining tenders, awarding
and administering contracts. Except as permitted by the Copyright, Designs
and Patents Act 1988, no part of this publication may be otherwise
reproduced, stored in a retrieval system or transmitted in any form or by any
means, electronic, mechanical, photocopying, recording or otherwise, without
the prior written permission of the NEC Director, NEC, Thomas Telford Ltd,
1 Heron Quay, London E14 4JD.

Typeset by Academic + Technical, Bristol

Printed and bound in Great Britain by Bell & Bain Limited, Glasgow, UK
CONTENTS

Acknowledgements iv

Schedule of Options 1

Core clauses 1 General 3

2 The Parties’ main responsibilities 7
3 Time 9
4 Quality 11
5 Payment 12
6 Compensation events 13

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7 Rights to material 17
8 Indemnity, insurance and liability 18

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9 Termination 19

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Main Option clauses A Priced contract with activity schedule 21

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C Target contract 23

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E Time based contract 25
G Term contract 26

Note Options B, D and F are not used

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Dispute resolution W1 Option W1 28

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W2 Option W2 31

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Secondary Option clauses X1 Price adjustment for inflation 34

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X2 Changes in the law 35

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X3 Multiple currencies 35

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X4 Parent company guarantee 36

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X5 Sectional Completion 36

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X6 Bonus for early Completion 36

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X7 Delay damages 36
X8 Collateral warranty agreements 37

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X9 Transfer of rights 37
X10 Employer’s Agent 37

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X11 Termination by the Employer 37
X12 Partnering 38

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X13 Performance bond 39

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X18 Limitation of liability 39

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X20 Key Performance Indicators 40

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Y(UK)2 The Housing Grants, Construction and Regeneration Act 1996 41
Y(UK)3 The Contracts (Rights of Third Parties) Act 1999 41
Z Additional conditions of contract 41

Note Options X14 to X17, X19 and Y(UK)1 are not used.

Contract Data 42

Index 51
ACKNOWLEDGEMENTS

The first edition of the NEC Professional Services Contract was drafted by
P. Higgins working on behalf of the Institution of Civil Engineers, with the
assistance of F. Griffiths of the Chartered Institute of Purchasing and Supply
and M. Coleman of the Association of Project Managers. Dr Martin Barnes then
of Coopers and Lybrand advised on the co-ordination of the contract with the
NEC.
The second edition of the NEC Professional Services Contract was mainly
drafted by Bill Weddell with the assistance of Peter Higgins and Tom
Nicholson as members of the NEC Panel with advice from Professor Phillip

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Capper then of Masons Solicitors.

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The NEC Panel also had the benefit of comments of the Construction Industry

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Council’s Task Force, which was established to investigate harmonisation of

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Conditions of Engagement (1994–95).
The third edition of the NEC Professional Services Contract was mainly

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drafted by Bill Weddell with the assistance of members of the NEC Panel. The

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Flow Charts were produced by Robert Gerrard with assistance from Ross

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Hayes and Tom Nicholson.
The original NEC was designed and drafted by Dr Martin Barnes then of

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Coopers and Lybrand with the assistance of Professor J. G. Perry then of the
University of Birmingham, T. W. Weddell then of Travers Morgan Management,

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T. H. Nicholson, Consultant to the Institution of Civil Engineers, A. Norman

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then of the University of Manchester Institute of Science and Technology and
P. A. Baird, then Corporate Contracts Consultant, Eskom, South Africa.

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The members of the NEC Panel are:

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P. Higgins, BSc, CEng, FICE, FCIArb (Chairman)

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P. A. Baird, BSc, CEng, FICE, M(SA)ICE, MAPM

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M. Barnes, BSc(Eng), PhD, FREng, FICE, FCIOB, CCMI, ACIArb, MBCS,

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FInstCES, FAPM
A. J. Bates, FRICS, MInstCES

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A. J. M. Blackler, BA, LLB(Cantab), MCIArb
P. T. Cousins, BEng(Tech), DipArb, CEng, MICE, MCIArb, MCMI

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L. T. Eames, BSc, FRICS, FCIOB
F. Forward, BA(Hons), DipArch, MSc(Const Law), RIBA, FCIArb

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Professor J. G. Perry, MEng, PhD, CEng, FICE, MAPM

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N. C. Shaw, FCIPS, CEng, MIMechE

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T. W. Weddell, BSc, CEng, DIC, FICE, FIStructE, ACIArb

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NEC Consultant
R. A. Gerrard, BSc(Hons), MRICS, FCIArb, FInstCES
Secretariat
A. Cole, LLB, LLM, BL
J. M. Hawkins, BA(Hons), MSc
F. N. Vernon (Technical Adviser), BSc, CEng, MICE
SCHEDULE OF OPTIONS

The strategy for choosing the form of contract starts with a decision between
four main Options, one of which must be chosen.

Option A Priced contract with activity schedule

Option C Target contract
Option E Time based contract

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Option G Term contract

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Note Options B, D and F are not used

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One of the following dispute resolution Options must be selected to complete
the chosen main Option.

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Option W1 Dispute resolution procedure (used unless United Kingdom Housing Grants,
Construction and Regeneration Act 1996 applies).

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Option W2 Dispute resolution procedure (used in the United Kingdom when the Housing

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Grants, Construction and Regeneration Act 1996 applies).

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The following secondary Options should then be considered. It is not necessary

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to use any of them. Any combination other than those stated may be used.

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Option X1 Price adjustment for inflation

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Option X2 Changes in the law

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Option X3 Multiple currencies (used only with Options A and G)

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Option X4 Parent company guarantee

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Option X5 Sectional Completion (not used with Option G)

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Option X6 Bonus for early Completion (not used with Option G)

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Option X7 Delay damages
Option X8 Collateral warranty agreements

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Option X9 Transfer of rights

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Option X10 Employer’s Agent

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Option X11 Termination by the Employer

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Option X12 Partnering
Option X13 Performance bond
Option X18 Limitation of liability
Option X20 Key Performance Indicators (not used with Option X12)
Option Y The following Options dealing with national legislation should be included if
required.
Option Y(UK)2 The Housing Grants, Construction and Regeneration Act 1996
Option Y(UK)3 The Contracts (Rights of Third Parties) Act 1999
Option Z Additional conditions of contract
Note Options X14 to X17, X19 and Y(UK)1 are not used.

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 Professional Services Contract

CORE CLAUSES

1 General

Actions 10

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10.1 The Employer and the Consultant shall act as stated in this contract and in a
spirit of mutual trust and co-operation.

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Identified and defined 11

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terms 11.1 In these conditions of contract, terms identified in the Contract Data are in

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italics and defined terms have capital initials.
11.2 (1) The Accepted Programme is the programme identified in the Contract Data

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or is the latest programme accepted by the Employer. The latest programme
accepted by the Employer supersedes previous Accepted Programmes.

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(2) Completion is when the Consultant has

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. done all the work which the Scope states he is to do by the Completion

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Date and

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. corrected Defects which would have prevented the Employer from using

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the services and Others from doing their work.

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If the work which the Consultant is to do by the Completion Date is not stated

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in the Scope, Completion is when the Consultant has done all the work
necessary for the Employer to use the services and for Others to do their work.

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(3) The Completion Date is the completion date unless later changed in
accordance with this contract.

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(4) The Contract Date is the date when this contract came into existence.

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(5) A Defect is a part of the services which is not in accordance with the

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Scope or the applicable law.

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(6) A Key Date is the date by which work is to meet the Condition stated. The

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Key Date is the key date stated in the Contract Data and the Condition is
the condition stated in the Contract Data unless later changed in accordance
with this contract.
(7) Others are people or organisations who are not the Employer, the Consultant,
the Adjudicator or any employee, Subconsultant or supplier of the Consultant.
(8) The Parties are the Employer and the Consultant.
(9) To Provide the Services means to do the work necessary to complete the
services in accordance with this contract and all incidental work, services and
actions which this contract requires.

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 Professional Services Contract

(10) The Risk Register is a register of the risks which are listed in the
Contract Data and the risks which the Employer or the Consultant has notified
as an early warning matter. It includes a description of the risk and a descrip-
tion of the actions which are to be taken to avoid or reduce the risk.
(11) The Scope is information which either
. specifies and describes the services or
. states any constraints on how the Consultant Provides the Services
and is either
. in the documents which the Contract Data states it is in or
. in an instruction given in accordance with this contract.
(12) A Subconsultant is a person or organisation who has a contract with the
Consultant to provide part of the services.

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(13) The Time Charge is the sum of the products of each of the staff rates
multiplied by the total staff time appropriate to that rate properly spent on

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work in this contract.

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Interpretation and the law 12

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12.1 In this contract, except where the context shows otherwise, words in the

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singular also mean in the plural and the other way round and words in the
masculine also mean in the feminine and neuter.

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12.2 This contract is governed by the law of the contract.

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12.3 No change to this contract, unless provided for by the conditions of contract,
has effect unless it has been agreed, confirmed in writing and signed by the

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Parties.

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12.4 This contract is the entire agreement between the Parties.

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Communications 13

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13.1 Each instruction, certificate, submission, proposal, record, acceptance, notifi-

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cation, reply and other communication which this contract requires is commu-

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nicated in a form which can be read, copied and recorded. Writing is in the
language of this contract.

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13.2 A communication has effect when it is received at the last address notified by

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the recipient for receiving communications or, if none is notified, at the
address of the recipient stated in the Contract Data.

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13.3 If this contract requires the Employer or the Consultant to reply to a communi-
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cation, unless otherwise stated in this contract, he replies within the period for
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reply.

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13.4 The Employer replies to a communication submitted or resubmitted to him by
the Consultant for acceptance. If his reply is not acceptance, the Employer

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states his reasons and the Consultant 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 Consul-
tant’s submission fully.
13.5 The Employer may extend the period for reply to a communication if the
Employer and the Consultant agree to the extension before the reply is due.
The Employer notifies the Consultant of the extension which has been agreed.
13.6 The Consultant retains copies of drawings, specifications, reports and other
documents which record the services for the period for retention. The copies
are retained in the form stated in the Scope.
13.7 A notification which this contract requires is communicated separately from
other communications.

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 Core Clauses

13.8 The Employer may withhold acceptance of a submission by the Consultant.

Withholding acceptance for a reason stated in this contract is not a compen-
sation event.

Acceptance 14
14.1 The Employer’s acceptance of a communication from the Consultant or of his
work does not change the Consultant’s responsibility to Provide the Services.

Early warning 15
15.1 The Employer and the Consultant give an early warning by notifying the other
as soon as either becomes aware of any matter which could
. increase the total of the Prices,
. delay Completion,
. change the Accepted Programme,

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. delay meeting a Key Date,

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. impair the usefulness of the services to the Employer or

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. affect the work of the Employer, an Employer’s contractor or another
consultant.

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The Consultant may give an early warning by notifying the Employer of any

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other matter which could increase his total cost. The Employer enters early

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warning matters in the Risk Register. Early warning of a matter for which a
compensation event has previously been notified is not required.

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15.2 Either the Employer or the Consultant may instruct the other to attend a risk

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reduction meeting. Each may instruct other people to attend if the other Party

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agrees.

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15.3 At a risk reduction meeting, those who attend co-operate in

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. making and considering proposals for how the effect of the registered

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risks can be avoided or reduced,
. seeking solutions that will bring advantage to all those who will be

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affected,

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. deciding on the actions which will be taken and who, in accordance with

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this contract, will take them and
. deciding which risks have now been avoided or have passed and can be

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removed from the Risk Register.

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15.4 The Employer revises the Risk Register to record the decisions made at each
risk reduction meeting and issues the revised Risk Register to the Consultant.
If a decision needs a change to the Scope, the Employer instructs the change

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at the same time as he issues the revised Risk Register.

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Ambiguities and 16

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inconsistencies 16.1 The Employer or the Consultant notifies the other as soon as either becomes
aware of an ambiguity or inconsistency in or between the documents which

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are part of this contract. The Employer gives an instruction resolving the
ambiguity or inconsistency.

Illegal and impossible 17

requirements 17.1 The Consultant notifies the Employer as soon as he considers that the Scope
requires him to do anything which is illegal or impossible. If the Employer
agrees, he gives an instruction to change the Scope appropriately.

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 Professional Services Contract

Prevention 18
18.1 If an event occurs which
. stops the Consultant Providing the Service or
. stops the Consultant Providing the Service by the date shown on the
Accepted Programme,
and which
. neither Party could prevent and
. an experienced consultant would have judged at the Contract Date to
have such a small chance of occurring that it would have been unreason-
able for him to have allowed for it,
the Employer gives an instruction to the Consultant stating how he is to deal
with the event.

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 Core Clauses

2 The Parties’ main responsibilities

The Employer’s obligations 20

20.1 The Employer provides information and things which this contract requires him
to provide in accordance with the Accepted Programme.
20.2 The Employer may give an instruction to the Consultant which changes the
Scope or a Key Date. After Completion, an instruction is given only if it is
necessary to Provide the Services.
20.3 The Employer does not give an instruction to the Consultant which would
require him to act in a way that was outside his professional code of conduct.

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The Consultant’s 21

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obligations 21.1 The Consultant Provides the Services in accordance with the Scope.

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21.2 The Consultant’s obligation is to use the skill and care normally used by

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professionals providing services similar to the services.

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People 22
22.1

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The Consultant either employs each key person named to do the job for him

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stated in the Contract Data or employs a replacement person who has been
accepted by the Employer. The Consultant submits the name, relevant qualifi-

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cations and experience of a proposed replacement person to the Employer for
acceptance. A reason for not accepting the person is that his relevant qualifi-

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cations and experience are not as good as those of the person who is to be

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replaced.

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22.2 The Employer may, having stated his reasons, instruct the Consultant to
remove a person employed by the Consultant. The Consultant then arranges

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that, after one day, the person has no further connection with the work

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included in this contract.

Working with the Employer 23

and Others 23.1

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The Consultant co-operates with Others in obtaining and providing information

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which they need in connection with the services.
23.2 Where necessary to Provide the Services, the Consultant holds or attends

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meetings with Others. The Consultant informs the Employer of these meetings

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beforehand and the Employer may attend them.

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23.3 If the Employer decides that the work does not meet the Condition stated for
a Key Date by the date stated and, as a result, the Employer incurs additional

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cost either

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. in carrying out work or
. by paying an additional amount to Others in carrying out work
on the same project, the additional cost the Employer has paid or will incur
is paid by the Consultant. The Employer assesses the additional cost within
four weeks of the date when the Condition stated for that Key Date is met.
The Employer’s right to recover the additional cost which is his only right in
these circumstances.

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 Professional Services Contract

Subconsulting 24
24.1 If the Consultant subcontracts work, he is responsible for Providing the
Services as if he had not subcontracted. This contract applies as if a Subcon-
sultant’s employees were the Consultant’s.
24.2 The Consultant submits the name of each proposed Subconsultant to the
Employer for acceptance. A reason for not accepting the Subconsultant is that
his appointment will not allow the Consultant to Provide the Services. The
Consultant does not appoint a proposed Subconsultant until the Employer has
accepted him.
24.3 The Consultant submits the proposed conditions of contract for each subcon-
tract to the Employer for acceptance unless
. an NEC contract is proposed or
. the Employer has agreed that no submission is required.

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The Consultant does not appoint a Subconsultant on the proposed subcontract
conditions submitted until the Employer has accepted them. A reason for not

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accepting them is that

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. they will not allow the Consultant to Provide the Services or
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. they do not include a statement that the parties to the subcontract shall

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act in a spirit of mutual trust and co-operation.

Other responsibilities 25
25.1

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The Consultant obtains approval from Others where necessary to Provide the

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Services.

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25.2 The Employer provides access to a person, place or thing to the Consultant as

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stated in the Contract Data on or before the later of its access date and the
access date for it shown on the Accepted Programme.

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25.3 The Consultant obeys an instruction which is in accordance with this contract
and is given to him by the Employer.

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25.4 The Consultant acts in accordance with the health and safety requirements
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stated in the Scope.

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 Core Clauses

3 Time

Starting, Completion and 30

Key Dates 30.1 The Consultant does not start work until the starting date and does the work
so that Completion is on or before the Completion Date.
30.2 The Employer decides the date of Completion and certifies it within one week
of the date.
30.3 The Consultant does the work so that the Condition stated for each Key Date
is met by the Key Date.

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The programme 31

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31.1 If a programme is not identified in the Contract Data, the Consultant submits

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a first programme to the Employer for acceptance within the period stated in

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the Contract Data.

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31.2 The Consultant shows on each programme which he submits for acceptance

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. the starting date, access dates, Key Dates and Completion Date,

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. planned Completion,

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. the order and timing of the operations which the Consultant plans to do
in order to Provide the Services,

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. the order and timing of the work of the Employer and Others as last

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agreed with them by the Consultant or, if not so agreed, as stated in the

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Scope,
. the dates when the Consultant plans to meet each Condition stated for

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the Key Dates and to complete other work needed to allow the Employer

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and Others to do their work,
. provisions for

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. float,

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. time risk allowances,

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. health and safety requirements and

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. the procedures set out in this contract,

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. the dates when, in order to Provide the Services in accordance with his
programme, the Consultant will need

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. access to a person, place or thing if later than its access date,

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. information and things to be provided by the Employer and

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. information and approval from Others,

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. for each operation, a statement of how the Consultant plans to do the

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work identifying the resources which he plans to use and

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. other information which the Scope requires the Consultant to show on a
programme submitted for acceptance.
31.3 Within two weeks of the Consultant submitting a programme to him for accep-
tance, the Employer either accepts the programme or notifies the Consultant of
his reasons for not accepting it. A reason for not accepting a programme is that
. the Consultant’s plans which it shows are not practicable,
. it does not show the information which this contract requires,
. it does not represent the Consultant’s plans realistically or
. it does not comply with the Scope.

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 Professional Services Contract

Revising the programme 32

32.1 The Consultant shows on each revised programme
. the actual progress achieved on each operation and its effect upon the
timing of the remaining work,
. the effects of implemented compensation events and of notified early
warning matters,
. how the Consultant plans to deal with any delays and to correct notified
Defects and
. any other changes which the Consultant proposes to make to the
Accepted Programme.
32.2 The Consultant submits a revised programme to the Employer for acceptance
. within the period for reply after the Employer has instructed him to,
. when the Consultant chooses to and, in any case,

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. at no longer interval than the interval stated in the Contract Data from

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the starting date until Completion of the whole of the services.

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Instructions to stop or not 33

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to start work 33.1 The Employer may instruct the Consultant to stop or not to start any work and
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may later instruct him that he may re-start or start it.

Acceleration 34

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34.1 The Employer may instruct the Consultant to submit a quotation for accelera-
tion to achieve Completion before the Completion Date. The Employer states

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changes to the Key Dates to be included in the quotation. A quotation for

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an acceleration comprises proposed changes to the Prices and a revised

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programme showing the earlier Completion Date and the changed Key Dates.
The Consultant submits details of his assessment with each quotation.

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34.2 The Consultant submits a quotation or gives his reasons for not doing so

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within the period for reply.

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 Core Clauses

4 Quality

Quality management 40
system 40.1 The Consultant operates a quality management system for Providing the
Services as stated in the Scope. The quality management system complies
with the requirements stated in the Scope.
40.2 The Consultant provides the Employer, within the period stated in the Contract
Data, with a quality policy statement and a quality plan for acceptance. The
quality policy statement and quality plan comply with the requirements stated
in the Scope.

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40.3 The Consultant complies with an instruction from the Employer to the Consul-

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tant to correct a failure to comply with the quality plan.

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Correcting Defects 41
41.1 Until the defects date, the Employer notifies the Consultant of each Defect as

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soon as he finds it and the Consultant notifies the Employer of each Defect as
soon as he finds it. At Completion the Consultant notifies the Employer of the

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Defects which have not been corrected. After Completion and until the defects

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date, the Consultant notifies the Employer of each Defect as soon as he finds
it. The Employer’s rights in respect of a Defect which the Employer has not

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found or notified by the defects date are not affected.

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41.2 The Consultant corrects a Defect whether or not the Employer notifies him of

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it. The Consultant corrects Defects within a time which minimises the adverse

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effect on the Employer or Others. If the Consultant does not correct a Defect
within the time required by this contract, the Employer assesses the cost to

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him of having the Defect corrected by other people and the Consultant pays

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this amount.

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 Professional Services Contract

5 Payment

Assessing the amount due 50

50.1 The Consultant assesses the amount due and submits an invoice at each
assessment date. The first assessment date is decided by the Consultant to
suit the procedures of the Parties and is not later than the assessment interval
after the starting date. Later assessment dates occur
. at the end of each assessment interval until eight weeks after the defects
date and
. at Completion of the whole of the services.

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50.2 Invoices submitted by the Consultant include the details stated in the Scope

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to show how the amount due has been assessed. The first invoice is for the

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amount due. Other invoices are for the change in the amount due since the

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previous invoice.
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50.3 The amount due is

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. the Price for Services Provided to Date,

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. the amount of the expenses properly spent by the Consultant in Providing

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the Services and
. other amounts to be paid to the Consultant less amounts to be paid by or

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retained from the Consultant.

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Any tax which the law requires the Employer to pay to the Consultant is

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included in the amount due.

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Payment 51

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51.1 Each payment is made within three weeks of receiving the Consultant’s invoice

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or, if a different period is stated in the Contract Data, within the period stated.

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Each payment is the amount due less previous payments.

secondary

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51.2 Payments are in the currency of this contract unless otherwise stated in this

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contract.
51.3 If the Employer does not accept the Consultant’s assessment of the amount

H
due, he notifies the Consultant of his reasons and the amount which he
assesses is due before the payment becomes due. He pays the amount of his

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assessment. The agreed part of the invoice is paid. The Consultant either
contract

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. corrects the invoice to a sum agreed by the Employer or

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. provides further information to justify the invoice.

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51.4 If a payment is late or has been delayed because of a disagreement, interest
is paid. Interest is assessed from the date by which the late payment should

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have been made until the date when the late payment is made, and is
included in the first assessment after the late payment is made.
51.5 Interest is calculated on a daily basis at the interest rate and is compounded
annually.

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 Core Clauses

6 Compensation events

Compensation events 60
60.1 The following are compensation events.
(1) The Employer gives an instruction changing the Scope.
(2) The Employer does not provide access to a person, place or thing for the
Consultant as stated in this contract.
(3) The Employer does not provide something which he is to provide by the
date for providing it shown on the Accepted Programme.

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(4) The Employer gives an instruction to stop or not to start any work or to

l
change a Key Date.

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(5) The Employer or Others do not work within the times shown on the

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Accepted Programme or within the conditions stated in the Scope.

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(6) The Employer does not reply to a communication from the Consultant

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within the period required by this contract.

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(7) The Employer changes a decision which he has previously communicated

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to the Consultant.

option clauses
(8) The Employer withholds an acceptance (other than acceptance of a

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quotation for acceleration) for a reason not stated in this contract.

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(9) The Employer notifies a correction to an assumption which he has stated

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about a compensation event.

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(10) A breach of contract by the Employer which is not one of the other
compensation events in this contract.

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(11) An event which

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. stops the Consultant completing the services or

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. stops the Consultant completing the services by the date shown on the
Accepted Programme,

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and which
. neither Party could prevent,

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. an experienced consultant would have judged at the Contract Date to

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have such a small chance of occurring that it would have been unreason-

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able for him to have allowed for it and
. is not one of the other compensation events stated in this contract.

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(12) The Consultant corrects a Defect for which he is not liable under this

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contract.

Notifying compensation 61
events 61.1 For compensation events which arise from the Employer giving an instruction
or changing an earlier decision, the Employer notifies the Consultant of the
compensation event at the time of giving the instruction or changing the
earlier decision. He also instructs the Consultant to submit quotations, unless
the event arises from a fault of the Consultant or quotations have already
been submitted. The Consultant puts the instruction or changed decision into
effect.
61.2 The Employer may instruct the Consultant to submit quotations for a proposed
instruction or a proposed changed decision. The Consultant does not put a
proposed instruction or a proposed changed decision into effect.

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 Professional Services Contract

61.3 The Consultant notifies the Employer of an event which has happened or which
he expects to happen as a compensation event if
. the Consultant believes that the event is a compensation event and
. the Employer has not notified the event to the Consultant.
If the Consultant does not notify a compensation event within eight weeks of
becoming aware of the event, he is not entitled to a change in Prices, the
Completion Date or a Key Date unless the Employer should have notified the
event to the Consultant but did not.
61.4 If the Employer decides that an event notified by the Consultant
. arises from a fault of the Consultant,
. has not happened and is not expected to happen,
. has no effect upon the Consultant’s costs, Completion or meeting a Key
Date or

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. is not one of the compensation events stated in this contract

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he notifies the Consultant of his decision that the Prices, the Completion Date
and the Key Date are not to be changed.

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If the Employer decides otherwise, he notifies the Consultant accordingly and

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instructs him to submit quotations.

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If the Employer does not notify his decision to the Consultant within either

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. one week of the Consultant’s notification or
. a longer period to which the Consultant has agreed,

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the Consultant may notify the Employer to this effect. A failure by the Employer

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to reply within two weeks of this notification is treated as acceptance by the

Employer that the event is a compensation event and an instruction to submit

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quotations.

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61.5 If the Employer decides that the Consultant did not give an early warning of

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the event which an experienced consultant could have given, he notifies this

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option clauses

decision to the Consultant when he instructs him to submit quotations.

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61.6 If the Employer decides that the effects of a compensation event are too
uncertain to be forecast reasonably, he states assumptions about the event in

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his instruction to the Consultant to submit quotations. Assessment of the

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event is based on these assumptions. If any of them is later found to have
been wrong, the Employer notifies a correction.
61.7 A compensation event is not notified after the defects date.

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contract

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data

Quotations for 62

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compensation events 62.1 After discussing with the Consultant different ways of dealing with the compen-

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sation event which are practicable, the Employer may instruct the Consultant to
submit alternative quotations. The Consultant submits the required quotations

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to the Employer and may submit quotations for other methods of dealing with
the compensation event which he considers practicable.
62.2 Quotations for compensation events comprise proposed changes to the
Prices and any delay to the Completion Date and Key Dates assessed by the
Consultant. The Consultant submits details of his assessment with each
quotation. If the programme for remaining work is altered by the compensa-
tion event, the Consultant includes the alterations to the Accepted Programme
in his quotation.

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 Core Clauses

62.3 The Consultant submits quotations within two weeks of being instructed to do
so by the Employer. The Employer replies within two weeks of the submission.
His reply is
. an instruction to submit a revised quotation,
. an acceptance of a quotation,
. a notification that a proposed instruction will not be given or a proposed
changed decision will not be made or
. a notification that he will be making his own assessment.

62.4 The Employer instructs the Consultant to submit a revised quotation only after
explaining his reasons for doing so to the Consultant. The Consultant submits
the revised quotation within three weeks of being instructed to do so.
62.5 The Employer extends the time allowed for
. the Consultant to submit quotations for a compensation event and

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. the Employer to reply to a quotation

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if the Employer and the Consultant agree to the extension before the submis-
sion or reply is due. The Employer notifies the extension that has been agreed

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to the Consultant.

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62.6 If the Employer does not reply to a quotation within the time allowed, the

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Consultant may notify the Employer to this effect. If the Consultant submitted
more than one quotation for the compensation event, he states in his notifica-

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tion which quotation he proposes is to be accepted. If the Employer does not
reply to the notification within two weeks and, unless the quotation is for a

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proposed instruction or a proposed changed decision, the Consultant’s
notification is treated as acceptance of the quotation by the Employer.

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Assessing compensation 63

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events 63.1 The changes to the Prices are assessed as the effect of the compensation

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event upon

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.

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the actual Time Charge for the work already done and

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. the forecast Time Charge for the work not yet done.

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The date when the Employer instructed or should have instructed the Consul-

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tant to submit quotations divides the work already done from the work not yet
done.

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63.2 If the effect of a compensation event is to reduce the total Time Charge, the
Prices are not reduced excepted as stated in this contract.

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63.3 A delay to the Completion Date is assessed as the length of time that, due to

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the compensation event, planned Completion is later than planned Completion

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as shown on the Accepted Programme. A delay to a Key Date is assessed as

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the length of time that, due to the compensation event, the planned date
when the Condition stated for a Key Date will be met is later than the date

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shown on the Accepted Programme.
63.4 The rights of the Employer and the Consultant to changes to the Prices,
the Completion Date and the Key Dates are their only rights in respect of a
compensation event.
63.5 If the Employer has notified the Consultant of his decision that the Consultant
did not give an early warning of a compensation event which an experienced
consultant could have given, the event is assessed as if the Consultant had
given early warning.
63.6 Assessment of the effect of a compensation event includes risk allowances
for cost and time for matters which have a significant chance of occurring and
are at the Consultant’s risk under this contract.
63.7 Assessments for work not yet done are based upon the assumptions that the
Consultant will react competently and promptly to the compensation event and
that the Accepted Programme can be changed. Assessments for work already
done include only cost and time which were reasonably incurred.

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 Professional Services Contract

63.8 A compensation event which is an instruction to change the Scope in order to

resolve an ambiguity or inconsistency is assessed as if the Prices, the
Completion Date and the Key Dates were for the interpretation most favour-
able to the Party which did not provide the Scope.
63.9 If a change to the Scope makes the description of the Condition for a Key
Date incorrect, the Employer corrects the description. This correction is taken
into account in assessing the compensation event for the change to the
Scope.
63.10 If the work included in a quotation for a compensation event includes work
by staff for which there is no staff rate, a proposed rate is included in the
quotation.
63.11 The following are deducted from the assessment of compensation events
. the cost of events for which this contract requires the Consultant to

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insure and
. other costs paid to the Consultant by insurers.

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The Employer’s 64

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assessments 64.1 The Employer assesses a compensation event
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. if the Consultant has not submitted a required quotation and details of

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his assessment within the time allowed,
. if the Employer decides that the Consultant has not assessed the

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compensation event correctly in a quotation and he does not instruct the
Consultant to submit a revised quotation,

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. if, when the Consultant submits quotations for a compensation event, he
has not submitted a programme or alterations to a programme which

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this contract requires him to submit or

. if, when the Consultant submits quotations for a compensation event, the

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Employer has not accepted the Consultant’s latest programme for one of

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the reasons stated in this contract.

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64.2 The Employer assesses a compensation event using his own assessment of
secondary

the programme for the remaining work if

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. there is no Accepted Programme or

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. the Consultant has not submitted a programme or alterations to a
programme for acceptance as required by this contract.

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64.3 The Employer notifies the Consultant of his assessment of a compensation
event and gives him details of it within the period allowed for the Consultant’s

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submission of his quotation for the same event. This period starts when the
contract

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need for the Employer’s assessment becomes apparent.
data

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64.4 If the Employer does not assess a compensation event within the time

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allowed, the Consultant may notify the Employer to this effect. If the Consul-
tant submitted more than one quotation for the compensation event, he

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states in his notification which quotation he proposes is to be accepted. If the
Employer does not reply within two weeks of this notification the notification is
treated as acceptance of the Consultant’s quotation by the Employer.

Implementing 65
compensation events 65.1 A compensation event is implemented when
. the Employer notifies his acceptance of the Consultant’s quotation,
. the Employer notifies the Consultant of his own assessment or
. a Consultant’s quotation is treated as having been accepted by the
Employer.
65.2 The assessment of a compensation event is not revised if a forecast upon
which it is based is shown by later recorded information to have been wrong.

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 Core Clauses

7 Rights to material

The Parties’ use of 70

material 70.1 The Employer has the right to use the material provided by the Consultant for
the purpose stated in the Scope. The Consultant obtains from a Subconsultant
equivalent rights for the Employer to use material prepared by the Subconsul-
tant.
70.2 The Consultant has the right to use material provided by the Employer only to
Provide the Services. The Consultant may make this right available to a
Subconsultant. On Completion of the whole of the services, the Consultant
returns the material provided by the Employer to him.

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70.3 The Parties do not disclose information obtained in connection with the

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services except when necessary to carry out their duties under this contract.

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70.4 The Consultant may use the material provided by him under this contract for

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other work unless stated in the Scope.

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Publicity 71
71.1

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The Consultant may publicise the services only with the Employer’s written

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agreement.

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 Professional Services Contract

8 Indemnity, insurance and liability

Indemnity 80
80.1 The Consultant indemnifies the Employer against claims, proceedings,
compensation and costs payable arising out of an infringement by the Consul-
tant of the rights of Others, except an infringement which arose out of the use
by the Consultant of things provided by the Employer.

Insurance cover 81
81.1 The Consultant provides the insurances stated in the Insurance Table except
any insurance which the Employer is to provide as stated in the Contract Data.

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The insurances provide cover from the Contract Date until the end of the

l
periods stated in the Contract Data.

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INSURANCE TABLE
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Insurance against Minimum amount of cover

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Liability of the Consultant for claims made The amount stated in the

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against him arising out of his failure to use Contract Data
the skill and care normally used by

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professionals providing services similar to

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the services

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Liability for death of or bodily injury to a The amount stated in the

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person (not an employee of the Consultant) Contract Data for any one

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or loss of or damage to property resulting event
from an action or failure to take action by

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option clauses

the Consultant
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Liability for death of or bodily injury to The greater of the amount

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employees of the Consultant arising out of required by the applicable law
and in the course of their employment in and the amount stated in the

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connection with this contract Contract Data for any one
event

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contract

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81.2 When requested by a Party the other Party provides certificates from his
data

insurer or broker stating that the insurances required by this contract are in

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force.

Es Limitation of liability 82
82.1 The Consultant’s total liability to the Employer for all matters arising under or
in connection with this contract, other than the excluded matters, is limited to
the amount stated in the Contract Data and applies in contract, tort or delict
and otherwise to the extent allowed under the law of the contract.
The excluded matters are amounts payable by the Consultant as stated in this
contract for
. delay damages if Option X7 applies,
. Consultant’s share if Option C applies,
. an infringement by the Consultant of the rights of Others,
. loss of or damage to third party property and
. death of or bodily injury to a person other than an employee of the
Consultant.
82.2 The Consultant’s liability to the Employer is limited to that proportion of the
Employer’s losses for which the Consultant is responsible under this contract.

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 Core Clauses

9 Termination

Termination 90
90.1 Either Party may terminate the Consultant’s obligation to Provide the Services
by notifying the other Party if the other Party has done one of the following or
its equivalent.
. If the other Party is an individual and has
. presented his petition for bankruptcy,
. had a bankruptcy order made against him,
. had a receiver appointed over his assets or

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. made an arrangement with his creditors.

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. If the other Party is a company or partnership and has

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. had a winding-up order made against it,

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. had a provisional liquidator appointed to it,

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. passed a resolution for winding-up (other than in order to amalgamate

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or reconstruct),

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. had an administration order made against it,

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. had a receiver, receiver and manager, or administrative receiver
appointed over the whole or a substantial part of its undertaking or

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assets or

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. made an arrangement with its creditors.

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90.2 The Consultant may terminate his obligation to Provide the Services by
notifying the Employer if the Employer has not paid an amount due to the

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Consultant within eight weeks of the issue of a notice by the Consultant to the

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Employer that payment is overdue.

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90.3 The Employer may terminate the Consultant’s obligation to Provide the

secondary
Services by notifying the Consultant if

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. the Employer no longer requires the services or

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. the Consultant has substantially failed to comply with his obligations and
has not put the default right within four weeks of a notification by the

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Employer.
90.4 The Employer may terminate the Consultant’s obligation to Provide the

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Services by notifying the Consultant if an event occurs which

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. stops the Consultant completing the services or

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. stops the Consultant completing the services by the date shown on the

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Accepted Programme and is forecast to delay Completion by more than
13 weeks,

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and which
. neither Party could prevent and
. an experienced consultant would have judged at the Contract Date to
have such a small chance of occurring that it would have been unreason-
able for him to have allowed for it.

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 Professional Services Contract

Procedures on termination 91
91.1 On termination
. the Consultant does no further work necessary to Provide the Services,
. the Employer may complete the services and may use any material to
which he has title,
. the Employer may require the Consultant to assign the benefit of any
subconsultancy or other contract related to performance of this contract
to the Employer and
. the Parties continue to comply with the constraints and obligations in
this contract on
. the use of material prepared or obtained by the Consultant and
. publicising the services.
After the final payment has been made, the Consultant gives to the Employer

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information resulting from work carried out to date and information the

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Consultant has obtained which he has a responsibility to provide under this

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contract.

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Payment on termination 92
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92.1 A final payment is made as soon as possible after termination. The amount

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due on termination includes

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. an amount due assessed as for normal payments and

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. other costs reasonably incurred by the Consultant in expectation of
completing the whole of the services and to which the Consultant is

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option clauses

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committed.

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92.2 If the Employer terminates because of the

. insolvency of the Consultant or

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. substantial failure of the Consultant to comply with his obligations,

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the amount due on termination includes a deduction of the forecast of the

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additional cost to the Employer of completing the whole of the services.
option clauses
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MAIN OPTION CLAUSES

Option A: Priced contract with activity schedule

Identified and defined 11

terms 11.2 (14) The Activity Schedule is the activity schedule unless later changed in
accordance with this contract.

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(15) The Price for Services Provided to Date is the total of the Prices for the

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activities which have been completed. A completed activity is one which is

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without Defects which would delay immediately following work.

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(18) The Prices are the lump sum prices for each of the activities on the
Activity Schedule unless later changed in accordance with this contract.

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The Consultant’s 21
obligations 21.3 The Consultant prepares forecasts of the total expenses for the whole of the

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services and submits them to the Employer. Forecasts are prepared at the
intervals stated in the Contract Data from the starting date until Completion

td
of the whole of the services. An explanation of the changes made since the
previous forecast is submitted with each forecast.

The programme 31
31.4

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The Consultant provides information which shows how each activity on the

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Activity Schedule relates to the operations on each programme which he

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submits for acceptance.

Acceleration 34
34.3

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When the Employer accepts a quotation for an acceleration, he changes the

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Prices, the Completion Date and the Key Dates accordingly and accepts the
revised programme.

Accounts and records 52

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52.1 The Consultant keeps accounts and records of his expenses and allows the
Employer to inspect them at any time within working hours.

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The Activity Schedule 53

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53.1 Information in the Activity Schedule is not Scope.

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53.2 If the Consultant changes a planned method of completing the services at his
discretion so that the Activity Schedule does not comply with the Accepted
Programme, he submits a revision of the Activity Schedule to the Employer for
acceptance.
53.3 A reason for not accepting a revision of the Activity Schedule is that
. it does not comply with the Accepted Programme,
. any changed Prices are not reasonably distributed between the activities
or
. the total of the Prices is changed.

Quotations for 62
compensation events 62.7 The cost of preparing quotations for compensation events is not included in
the assessment of compensation events.

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 Professional Services Contract

Assessing compensation 63
events 63.12 If the effect of a compensation event is to reduce the total Time Charge and
the event is
. a change to the Scope or
. a correction of an assumption stated by the Employer for assessing an
earlier compensation event,
the Prices are reduced.
63.14 Assessments for changed Prices for compensation events are in the form of
changes to the Activity Schedule.

Implementing 65
compensation events 65.3 The changes to the Prices, the Completion Date and the Key Dates are
included in the notification implementing a compensation event.

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 Main Option Clauses

Option C: Target contract

Identified and defined 11

terms 11.2 (14) The Activity Schedule is the activity schedule unless later changed in
accordance with this contract.
(16) The Price for Services Provided to Date is the Time Charge for the work
which has been completed.
(18) The Prices are the lump sum prices for each of the activities on the
Activity Schedule unless later changed in accordance with this contract.

y
The Consultant’s 21

l
obligations 21.4 The Consultant prepares forecasts of the total Time Charge and expenses for

n
the whole of the services and submits them to the Employer. Forecasts are

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prepared at the intervals stated in the Contract Data from the starting date

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until Completion of the whole of the services. An explanation of the changes

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made since the previous forecast is submitted with each forecast.

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Subconsulting 24

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24.4 The Consultant submits the proposed contract data for each subcontract for
acceptance to the Employer if

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. an NEC contract is proposed and
. the Employer instructs the Consultant to make the submission.

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A reason for not accepting the proposed contract data is that its use will not

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allow the Consultant to Provide the Services.

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The programme 31

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31.4 The Consultant provides information which shows how each activity on the

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Activity Schedule relates to the operations on each programme which he

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submits for acceptance.

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Acceleration 34

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34.3 When the Employer accepts a quotation for an acceleration, he changes the
Prices, the Completion Date and the Key Dates accordingly and accepts the
revised programme.

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data
Assessing the amount due 50

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50.4 Payments of Time Charge made by the Consultant in a currency other than the
currency of this contract are included in the amount due as payments to be

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made to him in the same currency. Such payments are converted to the

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currency of this contract in order to calculate the Consultant’s share using the
exchange rates.

Accounts and records 52

52.2 The Consultant keeps accounts and records of his Time Charge and expenses
and allows the Employer to inspect them at any time within working hours.

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 Professional Services Contract

The Activity Schedule 53

53.1 Information in the Activity Schedule is not Scope.
53.2 If the Consultant changes a planned method of completing the services at his
discretion so that the Activity Schedule does not comply with the Accepted
Programme, he submits a revision of the Activity Schedule to the Employer for
acceptance.
53.3 A reason for not accepting a revision of the Activity Schedule is that
. it does not comply with the Accepted Programme,
. any changed Prices are not reasonably distributed between the activities
or
. the total of the Prices is changed.

The Consultant’s share 54

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54.1 The Employer assesses the Consultant’s share of the difference between the

l
total of the Prices and the Price for Services Provided to Date. The difference

n
is divided into increments falling within each of the share ranges. The limits of
a share range are the Price for Services Provided to Date divided by the total

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of the Prices, expressed as a percentage. The Consultant’s share equals the
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sum of the products of the increment within each share range and the

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corresponding Consultant’s share percentage.

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54.2 If the Price for Services Provided to Date is less than the total of the Prices,

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the Consultant is paid his share of the saving. If the Price for Services
Provided to Date is greater than the total of the Prices, the Consultant pays

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his share of the excess.

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54.3 The Employer makes a preliminary assessment of the Consultant’s share at

Completion of the whole of the services using his forecasts of the final Price

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for Services Provided to Date and the final total of the Prices. This share is

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included in the amount due following Completion of the whole of the services.

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54.4 The Employer makes a final assessment of the Consultant’s share using the

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option clauses

final Price for Services Provided to Date and the final total of the Prices. This
secondary

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share is included in the final amount due.

Assessing compensation 63

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events 63.13 If the effect of a compensation event is to reduce the total Time Charge and

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the event is
. a change to the Scope, other than a change to the Scope which the

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Consultant proposed and the Employer has accepted or
contract

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. a correction of an assumption stated by the Employer for assessing an
data

earlier compensation event,

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the Prices are reduced.

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63.14 Assessments for changed Prices for compensation events are in the form of
changes to the Activity Schedule.

Implementing 65
compensation events 65.3 The changes to the Prices, the Completion Date and the Key Dates are
included in the notification implementing a compensation event.

Payment on termination 92
92.3 If there is a termination, the Employer assesses the Consultant’s share. His
assessment uses as the Price for Services Provided to Date the total of the
Time Charge which the Consultant has paid and which he is committed to pay
for work done before termination.
The Employer’s assessment of the Consultant’s share is added to the amount
due to the Consultant on termination if there has been a saving or deducted if
there has been an excess.

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 Main Option Clauses

Option E: Time based contract

Identified and defined 11

terms 11.2 (16) The Price for Services Provided to Date is the Time Charge for the work
which has been completed.
(19) The Prices are the Time Charge.

The Consultant’s 21
obligations 21.4 The Consultant prepares forecasts of the total Time Charge and expenses for
the whole of the services and submits them to the Employer. Forecasts are
prepared at the intervals stated in the Contract Data from the starting date

l y
until Completion of the whole of the services. An explanation of the changes
made since the previous forecast is submitted with each forecast.

Subconsulting 24

on

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24.4 The Consultant submits the proposed contract data for each subcontract for

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acceptance to the Employer if

s
. an NEC contract is proposed and

u
. the Employer instructs the Consultant to make the submission.

d
A reason for not accepting the proposed contract data is that its use will not

option clauses
t
allow the Consultant to Provide the Services.

main
Acceleration 34

s
34.4 When the Employer accepts a quotation for an acceleration, he changes the
Completion Date, the Key Dates and the forecast of the total Time Charge for

g
the whole of the services accordingly and accepts the revised programme.

i n

option clauses
Assessing the amount due 50

secondary
l d
50.4 Payments of Time Charge made by the Consultant in a currency other than the
currency of this contract are included in the amount due as payments to be

o
made to him in the same currency. Such payments are converted to the
currency of this contract in order to calculate the Consultant’s share using the

H
exchange rates.

m
Accounts and records 52

contract
52.2 The Consultant keeps accounts and records of his Time Charge and expenses

o
data
and allows the Employer to inspect them at any time within working hours.

s k Implementing 65
compensation events 65.4 The changes to the forecast amount of the Prices, the Completion Date and

E
the Key Dates are included in the notification implementing a compensation
event.

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 Professional Services Contract

Option G: Term contract

Identified and defined 11

terms 11.2 (17) The Price for Services Provided to Date is, for each Task, the total of
. the Time Charge for work which has been completed on time based
items on the Task Schedule and
. a proportion of the lump sum price for each other item on the Task
Schedule which is the proportion of work completed on that item.
(20) The Prices are
. the Time Charge for items described as time based on the Task Schedule

l y
and
. the lump sum price in the Task Schedule for each other item.

on
(21) A Task is work within the services which the Employer may instruct the
clauses

Consultant to carry out within a stated period of time.

core

e
(22) Task Completion is when the Consultant has done all the work which the

s
Task Order requires him to do by the Task Completion Date, and corrected
Defects which would have prevented the Employer or Others from using the

u
services and Others from doing their work.

d
option clauses

(23) Task Completion Date is the date for completion stated in the Task

t
Order unless later changed in accordance with this contract.

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(24) A Task Order is the Employer’s instruction to carry out a Task.

s
(25) The Task Schedule is the task schedule unless later changed in accor-

g
dance with this contract.

i n
option clauses

The Consultant’s 21
secondary

obligations 21.4 The Consultant prepares forecasts of the total Time Charge and expenses for

l d
the whole of the services and submits them to the Employer. Forecasts are
prepared at the intervals stated in the Contract Data from the starting date

o
until Completion of the whole of the services. An explanation of the changes

H
made since the previous forecast is submitted with each forecast.

The programme 31

m
31.5 The Consultant provides information which shows how each item included in a
contract

o
Task relates to the operations on each programme which he submits for
data

acceptance.

s k
Assessing the amount due 50

E
50.4 Payments of Time Charge made by the Consultant in a currency other than
currency of this contract are included in the amount due as payments to be
made to him in the same currency. Such payments are converted to the
currency of this contract in order to calculate the Consultant’s share using
existing rates.

Accounts and records 52

52.2 The Consultant keeps accounts and records of his Time Charge and expenses
and allows the Employer to inspect them at any time within working hours.

26 # copyright nec 2005 www.neccontract.com

 Main Option Clauses

Assessing Tasks 55
55.1 A Task Order includes
. a detailed description of the work in the Task,
. a priced list of items of work in the Task in which items taken from the
Task Schedule are identified,
. the starting and completion dates for the Task,
. the amount of delay damages for late completion of the Task and
. the total of the Prices for the Task.

The Employer consults the Consultant about the contents of a Task Order
before he issues it.
55.2 The delay damages in a Task Order, if any, are not more than the estimated
cost to the Employer of late completion of the Task.
The Prices for items in the Task price list which are not taken from the Task

l y
Schedule are assessed in the same way as compensation events.

n
55.3 The Consultant does not start any work included in the Task until he has
received the Task Order, and does the work so that Task Completion is on

o
or before the Task Completion Date. No Task Order is issued after the

clauses
core
Completion Date.

Compensation events 60

s e
u
60.1 The following are compensation events.
(13) The Employer issues an instruction changing a Task Order. If the effect

option clauses
t
of a compensation event which is an instruction changing a Task Order is to
reduce the total Time Charge, the Prices are reduced.

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(14) The Consultant receives the Task Order after the starting date stated in

s
the Task Order.

g
(15) A Task Completion Date is later than the Completion Date.

i n

option clauses
60.2 The Employer corrects mistakes in the Task Schedule which arise from an

secondary
ambiguity or inconsistency in or between the documents which are part of this

l d
contract. Each such correction is a compensation event.

o
Quotations for 62

H
compensation events 62.7 The cost of preparing quotations for compensation events is not included in
the assessment of compensation events.

m
Assessing compensation 63

contract
o
events 63.16 A delay to the Task Completion Date is assessed as the length of time that

data
due to the compensation event, planned Task Completion is delayed.

s k 63.17 Assessments for changed Prices for compensation events are in the form of
changes to the Task Schedule.

E
63.18 If the effect of a compensation event is to reduce the total Time Charge and
the event is
. a change to the Task or
. a correction of an assumption stated by the Employer for assessing an
earlier compensation event,
the Prices are reduced.

Implementing 65
compensation events 65.5 The Employer includes the changes to
. the Prices and the Task Completion Date and
. the final total of the Prices for the Task and the programme for the Task
from the quotation which he has accepted or from his own assessment in the
notification implementing a compensation event.

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 DISPUTE RESOLUTION

Option W1

Dispute resolution procedure (used unless the United Kingdom Housing Grants, Construction and Regeneration Act
1996 applies).

Dispute resolution W1

l y
W1.1 A dispute arising under or in connection with this contract is referred to and
decided by the Adjudicator.

The Adjudicator W1.2

on
(1) The Parties appoint the Adjudicator under the NEC Adjudicator’s Contract
clauses

current at the starting date.

core

e
(2) The Adjudicator acts impartially and decides the dispute as an indepen-

s
dent adjudicator and not as an arbitrator.

u
(3) If the Adjudicator is not identified in the Contract Data or if the Adjudicator
resigns or is unable to act, the Parties may choose an adjudicator jointly. If

d
option clauses

t
the Parties have not chosen an adjudicator, either Party may ask the Adjudica-
tors nominating body to choose one. The Adjudicator nominating body chooses

L
main

an adjudicator within four days of the request The chosen adjudicator

becomes the Adjudicator.

gs
(4) A replacement Adjudicator has the power to decide a dispute referred to
his predecessor but not decided at the time when the predecessor resigned or

i n
option clauses

became unable to act. He deals with an undecided dispute as if it had been

secondary

referred to him on the date he was appointed.

l d
(5) The Adjudicator, his employees and agents are not liable to the Parties for

o
any action or failure to take action in an adjudication unless the action or
failure to take action was in bad faith.

The adjudication W1.3

H (1) Disputes are notified and referred to the Adjudicator in accordance with

m
the Adjudication Table.
contract

o
data

s k
E

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 Dispute Resolution

ADJUDICATION TABLE

Dispute about Which Party may When may it be referred to the

refer it to the Adjudicator?
Adjudicator?

An action of the The Consultant Between two and four weeks after
Employer the Consultant’s notification of the
dispute to the Employer, the
notification itself being made not
more than four weeks after the
Consultant becomes aware of the
action

The Employer not The Consultant Between two and four weeks after

l y
having taken an the Consultant’s notification of the
action dispute to the Employer, the

n
notification itself being made not

o
more than four weeks after the

clauses
Consultant becomes aware that the

core
e
action was not taken

s
A quotation for a The Employer Between two and four weeks after

u
compensation the Employer’s notification of the
event which is dispute to the Consultant, the

option clauses
t
treated as having notification itself being made not
been accepted more than four weeks after the

main
quotation was treated as accepted

s
Any other matter Either Party Between two and four weeks after

g
notification of the dispute to the

n
other Party

option clauses
secondary
l d
(2) The times for notifying and referring a dispute may be extended if the

o
Consultant and the Employer agree to the extension before the notice or
referral is due. If a disputed matter is not notified and referred within the

H
times set out in this contract, neither Party may subsequently refer it to the
Adjudicator or the tribunal.

m
(3) The Party referring the dispute to the Adjudicator includes with his referral

contract
information to be considered by the Adjudicator. Any more information from a

o
data
Party to be considered by the Adjudicator is provided within four weeks of the

k
referral. This period may be extended if the Adjudicator and the Parties agree.

s
(4a) If a matter disputed by the Consultant under or in connection with a

E
subcontract is also a matter disputed under or in connection with this contract
and if the subcontract allows, the Consultant may refer the subcontract dispute
to the Adjudicator at the same time as the main contract referral. The Adjudi-
cator then decides the disputes together and references to the Parties for the
purposes of the dispute are interpreted as including the Subconsultant.
(4b) If this contract is a subcontract and the main contract provides for joint
adjudication of disputes, the following procedure applies.
Within two weeks of the notification of the dispute by the Consultant to the
Employer, the Employer notifies the Consultant if the matter disputed is a
matter disputed under or in connection with the main contract.
The Employer may then
. submit the subcontract dispute to the main contract Adjudicator at the
same time as the main contract submission and
. instruct the Consultant to provide any information which the Employer
may require.

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 Professional Services Contract

The main contract Adjudicator then gives his decision on the disputes
together.
(5) The Adjudicator may
. review and revise any action or inaction of the Employer related to the
dispute and alter a quotation which has been treated as having been
accepted,
. take the initiative in ascertaining the facts and the law related to the
dispute,
. instruct a Party to provide further information related to the dispute
within a stated time and
. instruct a Party to take any other action which he considers necessary to
reach his decision and to do so within a stated time.
(6) A communication between a Party and the Adjudicator is communicated to
the other Party at the same time.

l y
(7) If the Adjudicator’s decision includes assessment of additional cost or

n
delay caused to the Consultant, he makes his assessment in the same way as
a compensation event is assessed.

o
clauses

(8) The Adjudicator decides the dispute and notifies the Parties of his decision
core

e
and his reasons within four weeks of the end of the period for receiving infor-

s
mation. This four week period may be extended if the Parties agree.

u
(9) Unless and until the Adjudicator has notified the Parties of his decision,
the Parties proceed as if the matter disputed was not disputed.

d
option clauses

t
(10) The Adjudicator’s decision is binding on the Parties unless and until
revised by the tribunal and is enforceable as a matter of contractual obligation

L
main

between the Parties and not as an arbitral award. The Adjudicator’s decision
is final and binding if neither Party has notified the other within the times

s
required by this contract that he is dissatisfied with a decision of the

g
Adjudicator and intends to refer the matter to the tribunal.

i n
option clauses

(11) The Adjudicator may, within two weeks of giving his decision to the
secondary

Parties, correct any clerical mistake or ambiguity.

Review by the tribunal W1.4

o l d
(1) A Party does not refer any dispute under or in connection with this
contract to the tribunal unless it has first been referred to the Adjudicator in

H
accordance with this contract.
(2) If, after the Adjudicator notifies his decision a Party is dissatisfied, he may

m
notify the other Party that he intends to refer it to the tribunal. A Party may not
contract

refer a dispute to the tribunal unless this notification is given within four

o
data

weeks of notification of the Adjudicator’s decision.

k
(3) If the Adjudicator does not notify his decision within the time provided by

s
this contract, a Party may notify the other Party that he intends to refer the

E
dispute to the tribunal. A Party may not refer a dispute to the tribunal unless
this notification is given within four weeks of the date by which the Adjudicator
should have notified his decision.
(4) The tribunal settles the dispute referred to it. The tribunal has the powers
to reconsider any decision of the Adjudicator and review and revise any action
or inaction of the Employer related to the dispute. A Party is not limited in the
tribunal proceedings to the information, evidence or arguments put to the
Adjudicator.
(5) If tribunal is arbitration, the arbitration procedure, the place where the
arbitration is to be held and the method of choosing the arbitrator are those
stated in the Contract Data.
(6) A Party does not call the Adjudicator as a witness in tribunal proceedings.

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 Dispute Resolution

Option W2

Dispute resolution procedure (used in the United Kingdom when the Housing Grants, Construction and Regeneration
Act 1996 applies).

Dispute resolution W2
W2.1 (1) Any dispute arising under or in connection with this contract is referred to
and decided by the Adjudicator. A Party may refer a dispute to the Adjudicator
at any time.
(2) In this Option, time periods stated in days exclude Christmas Day, Good
Friday and bank holidays.

l y
The Adjudicator W2.2 (1) The Parties appoint the Adjudicator under the NEC Adjudicator’s Contract

n
current at the starting date.

o
(2) The Adjudicator acts impartially and decides the dispute as an indepen-

clauses
dent adjudicator and not as an arbitrator.

core
e
(3) If the Adjudicator is not identified in the Contract Data or if the Adjudicator

s
resigns or becomes unable to act

u
. the Parties may choose an adjudicator jointly or
. a Party may ask the Adjudicator nominating body to choose an adjudicator.

option clauses
t
The Adjudicator nominating body chooses an adjudicator within four days of

main
the request. The chosen adjudicator becomes the Adjudicator.
(4) A replacement Adjudicator has the power to decide a dispute referred to

s
his predecessor but not decided at the time when his predecessor resigned or

g
became unable to act. He deals with an undecided dispute as if it had been

n
referred to him on the date he was appointed.

option clauses
secondary
(5) The Adjudicator, his employees and agents are not liable to the Parties for

l d
any action or failure to take action in an adjudication unless the action or
failure to take action was in bad faith.

The adjudication W2.3

H o
(1) Before a Party refers a dispute to the Adjudicator, he gives a notice of
adjudication to the other Party with a brief description of the dispute and the
decision which he wishes the Adjudicator to make. If the Adjudicator is named

m
in the Contract Data, the Party sends a copy of the notice of adjudication to

contract
o
the Adjudicator when it is issued. Within three days of the receipt of the notice

data
of adjudication, the Adjudicator notifies the Parties

s k
. that he is able to decide the dispute in accordance with the contract or
. that he is unable to decide the dispute and has resigned.

E
If the Adjudicator does not so notify within three days of the issue of the
notice of adjudication, either Party may act as if he has resigned.
(2) Within seven days of a Party giving a notice of adjudication he
. refers the dispute to the Adjudicator,
. provides the Adjudicator with the information on which he relies, including
any supporting documents and
. provides a copy of the information and supporting documents he has
provided to the Adjudicator to the other Party.
Any further information from a Party to be considered by the Adjudicator is
provided within fourteen days from the referral. This period may be extended if
the Adjudicator and Parties agree.

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 Professional Services Contract

(3a) If a matter disputed by the Consultant under or in connection with a

subcontract is also a matter disputed under or in connection with this contract,
the Consultant may, with the consent of the Subconsultant, refer the subcontract
dispute to the Adjudicator at the same time as the main contract referral. The
Adjudicator then decides the disputes together and references to the Parties for
the purposes of the dispute are interpreted as including the Subconsultant.
(3b) If this contract is a subcontract and the main contract provides for joint
adjudication of disputes, the following procedure applies.
Within two weeks of the notification of the dispute by the Consultant to the
Employer, the Employer notifies the Consultant if the matter disputed is a
matter disputed under or in connection with the main contract.
The Employer may then
. submit the subcontract dispute to the main contract Adjudicator at the

l y
same time as the main contract submission and
. instruct the Consultant to provide any information which the Employer

n
may require.

o
The main contract Adjudicator then gives his decision on the disputes
clauses
core

together.

s e
(4) The Adjudicator may

u
. review and revise any action or inaction of the Employer related to the
dispute and after a quotation which has been treated as having been

d
option clauses

accepted,

t
. take the initiative in ascertaining the facts and the law related to the

L
main

dispute,
. instruct a Party to provide further information related to the dispute

s
within a stated time and
. instruct a Party to take any other action which he considers necessary to

g
reach his decision and to do so within a stated time.

i n
option clauses

(5) If a Party does not comply with any instruction within the time stated by
secondary

d
the Adjudicator, the Adjudicator may continue the adjudication and make his

l
decision based upon the information and evidence he has received.

o
(6) A communication between a Party and the Adjudicator is communicated to

H
the other Party at the same time.
(7) If the Adjudicator’s decision includes assessment of additional cost or
delay caused to the Consultant, he makes his assessment in the same way as

m
contract

a compensation event is assessed.

o
data

(8) The Adjudicator decides the dispute and notifies the Parties of his decision

k
and his reasons within twenty-eight days of the dispute being referred to him.

s
This period may be extended by up to fourteen days with the consent of the

E
referring Party or by any other period agreed by the Parties.
(9) Unless and until the Adjudicator has notified the Parties of his decision,
the Parties proceed as if the matter disputed was not disputed.
(10) If the Adjudicator does not make his decision and notify it to the Parties
within the time provided by this contract the Parties and the Adjudicator may
agree to extend the period for making his decision. If they do not agree to an
extension, either Party may act as if the Adjudicator has resigned.
(11) The Adjudicator’s decision is binding on the Parties unless and until
revised by the tribunal and is enforceable as a matter of contractual obligation
between the Parties and not as an arbitral award. The Adjudicator’s decision
is final and binding if neither Party has notified the other within the times
required by this contract that he is dissatisfied with a matter decided by the
Adjudicator and intends to refer the matter to the tribunal.
(12) The Adjudicator may, within fourteen days of giving his decision to the
Parties, correct a clerical mistake or ambiguity.

32 # copyright nec 2005 www.neccontract.com

 Dispute Resolution

Review by the tribunal W2.4 (1) A Party does not refer any dispute under or in connection with this
contract to the tribunal unless it has first been decided by the Adjudicator in
accordance with this contract.
(2) If, after the Adjudicator notifies his decision a Party is dissatisfied, that
Party may notify the other Party of the matter which he disputes and state
that he intends to refer it to the tribunal. The dispute may not be referred to
the tribunal unless this notification is given within four weeks of the notifica-
tion of the Adjudicator’s decision.
(3) The tribunal settles the dispute referred to it. The tribunal has the powers
to reconsider any decision of the Adjudicator and to review and revise any
action or inaction of the Employer related to the dispute. A Party is not limited
in tribunal proceedings to the information or evidence put to the Adjudicator.
(4) If the tribunal is arbitration, the arbitration procedure, the place where the

y
arbitration is to be held and the method of choosing the arbitrator are those

l
stated in the Contract Data.

n
(5) A Party does not call the Adjudicator as a witness in tribunal proceedings.

clauses
core
s e
d u

option clauses
L t

main
gs
i n

option clauses
secondary
o l d
H
m
contract
o
data
s k
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 SECONDARY OPTION CLAUSES

Option X1: Price adjustment for inflation

If staff rates are fixed at the Contract Date and are not variable with changes
in salary paid to individuals.

Price adjustment factor X1

l y
X1.1 On each anniversary of the Contract Date, the Consultant calculates a price
adjustment factor equal to (L ÿ B)/B, where L is the last published value of

n
the index and B is the last value of the index published before the Contract

o
Date.
clauses
core

If an index is changed after it has been used in calculating a price adjustment

e
factor, the calculation is repeated and a correction included in the next

s
assessment of the amount due.

u
The price adjustment factor calculated at the Completion Date for the whole
of the services is used for calculating price adjustment after this date.

d
option clauses

t
Price adjustment X1.2 Each amount due after the first anniversary includes an amount for price

L
main

adjustment which is the sum of

s
. the change in the Price for Services Provided to Date since the last

g
assessment of the amount due multiplied by the price adjustment factor
calculated at the last anniversary and

i n
option clauses

. the amount for price adjustment included in the previous amount due.
secondary

l d
Price adjustment X1.3 Each time the amount due is assessed after the first anniversary, an amount
Option C for price adjustment is added to the total of the Prices which is the change in

o
the Price for Services Provided to Date since the last assessment of the

H
amount due multiplied by (PAF/(1+PAF)) where PAF is the price adjustment
factor calculated at the last anniversary.

m
Expenses adjustment X1.6 If payment rates for any of the expenses are fixed at the Contract Date and
contract

o
data

are not otherwise adjustable for inflation, each amount due after the first

k
anniversary includes an amount for expenses adjustment which is the sum of

s
. the change in fixed expenses since the last assessment of the amount
due multiplied by the price adjustment factor calculated at the last

E
anniversary and
. the amount for expenses adjustment included in the previous amount
due.

If staff rates are variable with changes in salary paid to individuals.

Price adjustment factor X1

X1.1 On each anniversary of the Contract Date, the Consultant calculates a price
adjustment factor equal to (L ÿ B)/B, where L is the last published value of
the index and B is the last value of the index published before the Contract
Date.
If an index is changed after it has been used in calculating a price adjustment
factor, the calculation is repeated and a correction included in the next
assessment of the amount due.
The price adjustment factor calculated at the Completion Date for the whole
of the services is used for calculating price adjustment after this date.

34 # copyright nec 2005 www.neccontract.com

 Secondary Option Clauses

Price adjustment X1.2 Each amount due after the first anniversary includes an amount for price
Option A adjustment which is the sum of
. the change in the Price for Services Provided to Date since the last
assessment of the amount due multiplied by the price adjustment factor
calculated at the last anniversary and
. the amount for price adjustment included in the previous amount due.

Price adjustment X1.3 Each time the amount due is assessed after the first anniversary, an amount
Option C for price adjustment is added to the total of the Prices which is the change in
the Price for Services Provided to Date since the last assessment of the
amount due multiplied by (PAF/(1+PAF)) where PAF is the price adjustment
factor calculated at the last anniversary.

Price adjustment X1.4 Each amount due after the first anniversary includes an amount for price

y
Option G adjustment which is the sum of

l
. for the lump sum items on the Task Schedule, the change in the lump

n
sums included in the Price for Services Provided to Date since the last

o
assessment of the amount due multiplied by the price adjustment factor

clauses
calculated at the last anniversary before the assessment and

core
e
. the amount for price adjustment included in the previous amount due.

s
Compensation events X1.5 The Time Charge for compensation events is assessed using the staff rates

u
Options A, C and G current at the time of assessing the compensation event adjusted to the
(lump sum items on the Contract Date by dividing by (1+PAF), where PAF is the price adjustment

option clauses
t
Task Schedule) only factor calculated at the last anniversary.

main
Expenses adjustment X1.6 If payment rates for any of the expenses are fixed at the Contract Date and
are not otherwise adjustable for inflation, each amount due after the first

s
anniversary includes an amount for expenses adjustment which is the sum of

g
. the change in fixed expenses since the last assessment of the amount

i n

option clauses
due multiplied by the price adjustment factor calculated at the last

secondary
anniversary and

l d
. the amount for expenses adjustment included in the previous amount

o
due.

H
m
Option X2: Changes in the law

contract
o
data
s k
Changes in the law X2
X2.1 A change in the law of the project is a compensation event if it occurs after

E
the Contract Date. Either Party may notify the other of a compensation event
for a change in the law. If the effect of a compensation event which is a
change in the law is to reduce the total Time Charge, the Prices are reduced.

Option X3: Multiple currencies (used only with Options A and G)

Multiple currencies X3
X3.1 The Consultant is paid in currencies other than the currency of this contract for
the items or activities listed in the Contract Data. The exchange rates are
used to convert from the currency of this contract to other currencies.

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 Professional Services Contract

X3.2 Payments to the Consultant in currencies other than the currency of this
contract do not exceed the maximum amounts stated in the Contract Data.
Any excess is paid in the currency of this contract.

Option X4: Parent company guarantee

Parent company X4
guarantee X4.1 If a parent company owns the Consultant, the Consultant gives to the Employer
a guarantee by the Consultant’s parent company of the Consultant’s perfor-
mance in the form set out in the Scope. If the guarantee was not given by the

y
Contract Date, it is given to the Employer within four weeks of the Contract

l
Date.

on
clauses
core

Option X5: Sectional Completion (not used with Option G)

s e
d u
option clauses

Sectional Completion X5

t
X5.1 In these conditions of contract, unless stated as the whole of the services,

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main

each reference and clause relevant to

s
. the services,
. Completion and

g
. Completion Date

i n
option clauses

applies, as the case may be, to either the whole of the services or any section
secondary

d
of the services.

o l
H
Option X6: Bonus for early Completion (not used with Option G)

m
contract

o
data

k
Bonus for early Completion X6
X6.1 The Consultant is paid a bonus calculated at the rate stated in the Contract

s
Data for each day from Completion until the Completion Date.

E
Option X7: Delay damages

Delay damages X7
Options A, C and E X7.1 The Consultant pays delay damages at the rate stated in the Contract Data
for each day from the Completion Date until Completion.
X7.2 If the Completion Date is changed to a later date after delay damages have
been paid, the Employer repays the overpayment of damages with interest.
Interest is assessed from the date of payment to the date of repayment and
the date of repayment is an assessment date.

36 # copyright nec 2005 www.neccontract.com

 Secondary Option Clauses

Option G only X7.3 The Consultant pays delay damages at the rate stated in the Task Order for
each day from the Task Completion Date until Task Completion.
X7.4 If the Task Completion Date is changed to a later date after delay damages
have been paid, the Employer repays the overpayment of delay damages with
interest. Interest is assessed from the date of payment to the date of repay-
ment and the date of repayment is an assessment date.

Option X8: Collateral warranty agreements

y
Collateral warranty X8

l
agreements X8.1 The Consultant enters into the collateral warranty agreements.

on

clauses
core
e
Option X9: Transfer of rights

u s
d

option clauses
Transfer of rights X9

t
X9.1 The Employer owns the Consultant’s rights over material prepared for this

main
contract by the Consultant except as stated otherwise in the Scope. The
Consultant obtains other rights for the Employer as stated in the Scope and

s
obtains from a Subconsultant equivalent rights for the Employer over the
material prepared by the Subconsultant. The Consultant provides to the

g
Employer the documents which transfer these rights to the Employer.

i n

option clauses
secondary
Option X10: Employer’s Agent
o l d
H
m
Employer’s Agent X10

contract
X10.1 The Employer’s Agent acts on behalf of the Employer with the authority set out

o
data
in the Contract Data.

s k
X10.2 The Employer may replace the Employer’s Agent after he has notified the
Consultant of the name of the replacement.

E
Option X11: Termination by the Employer

Termination by the X11

Employer X11.1 The Employer may terminate the Consultant’s obligation to Provide the
Services for a reason not stated in this contract by notifying the Consultant.

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 Professional Services Contract

X11.2 If the Employer terminates for a reason not stated in this contract, an
additional amount is due on termination which is 5% of the difference
between
. the forecast of the final total of the Prices in the absence of termination
and
. the total of the other amounts and costs included in the amount due on
termination.

Option X12: Partnering

y
Identified and defined X12

l
terms X12.1 (1) The Partners are those named in the Schedule of Partners. The Client is a

n
Partner.

o
(2) An Own Contract is a contract between two Partners which includes this
clauses
core

Option.

s e
(3) The Core Group comprises the Partners listed in the Schedule of Core
Group Members.

u
(4) Partnering Information is information which specifies how the Partners

d
option clauses

work together and is either in the documents which the Contract Data states

t
it is in or in an instruction given in accordance with this contact.

L
main

(5) A Key Performance Indicator is an aspect of performance for which a

target is stated in the Schedule of Partners.

gs
Actions X12.2 (1) Each Partner works with other Partners to achieve the Client’s objective

n
stated in the Contract Data and the objectives of every other Partner stated in

i
option clauses

the Schedule of Partners.

secondary

l d
(2) Each Partner nominates a representative to act for him in dealings with
other Partners.

o
(3) The Core Group acts and takes decisions on behalf of the Partners on

H
those matters stated in the Partnering Information.
(4) The Partners select the members of the Core Group. The Core Group

m
decides how they will work and decides the dates when each member joins
contract

o
and leaves the Core Group. The Client’s representative leads the Core Group
data

unless stated otherwise in the Partnering Information.

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(5) The Core Group keeps the Schedule of Core Group Members and the
Schedule of Partners up to date and issues copies of them to the Partners

E
each time either is revised.
(6) This Option does not create a legal partnership between Partners who are
not one of the Parties in this contract.

Working together X12.3 (1) The Partners work together as stated in the Partnering Information and in
a spirit of mutual trust and co-operation.
(2) A Partner may ask another Partner to provide information which he needs
to carry out the work in his Own Contract and the other Partner provides it.
(3) Each Partner gives an early warning to the other Partners when he
becomes aware of any matter that could affect the achievement of another
Partner’s objectives stated in the Schedule of Partners.
(4) The Partners use common information systems as set out in the Part-
nering Information.

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 Secondary Option Clauses

(5) A Partner implements a decision of the Core Group by issuing instructions

in accordance with its Own Contracts.
(6) The Core Group may give an instruction to the Partners to change the
Partnering Information. Each such change to the Partnering Information is a
compensation event which may lead to reduced Prices.
(7) The Core Group prepares and maintains a timetable showing the proposed
timing of the contributions of the Partners. The Core Group issues a copy of
the timetable to the Partners each time it is revised. The Consultant changes
his programme if it is necessary to do so in order to comply with the revised
timetable. Each such change is a compensation event which may lead to
reduced Prices.
(8) A Partner gives advice, information and opinion to the Core Group and to
other Partners when asked to do so by the Core Group. This advice, informa-

y
tion and opinion relates to work that another Partner is to carry out under its

l
Own Contract and is given fully, openly and objectively. The Partners show

n
contingency and risk allowances in information about costs, prices and timing
for future work.

clauses
(9) A Partner notifies the Core Group before subcontracting any work.

core
s e
Incentives X12.4 (1) A Partner is paid the amount stated in the Schedule of Partners if the
target stated for a Key Performance Indicator is improved upon or achieved.

u
Payment of the amount is due when the target has been improved upon or
achieved and is made as part of the amount due in the Partner’s Own

option clauses
t
Contract.

main
(2) The Client may add a Key Performance Indicator and associated payment
to the Schedule of Partners but may not delete or reduce a payment stated in

s
the Schedule of Partners.

i ng

option clauses
secondary
l d
Option X13: Performance bond

Performance bond X13

H o
X13.1 The Consultant gives the Employer a performance bond, provided by a bank or

m
insurer which the Employer has accepted, for the amount stated in the

contract
o
Contract Data and in the form set out in the Scope. A reason for not accepting

data
the bank or insurer is that its commercial position is not strong enough to

k
carry the bond. If the bond was not given by the Contract Date, it is given to

s
the Employer within four weeks of the Contract Date.

E
Option X18: Limitation of liability

Limitation of liability X18

X18.1 The Consultant’s liability to the Employer for the Employer’s indirect or conse-
quential loss is limited to the amount stated in the Contract Data.
X18.2 The Consultant’s liability to the Employer for Defects that are not found until
after the defects date is limited to the amount stated in the Contract Data.
X18.3 The Consultant is not liable to the Employer for a matter unless it is notified to
the Consultant before the end of liability date.

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 Professional Services Contract

Option X20: Key Performance Indicators (not used with Option X12)

Incentives X20
X20.1 A Key Performance Indicator is an aspect of performance by the Consultant for
which a target is stated in the Incentive Schedule. The Incentive Schedule is
the incentive schedule unless later changed in accordance with this contract.
X20.2 From the starting date until the defects date, the Consultant reports to the
Employer his performance against each of the Key Performance Indicators.
Reports are provided at the intervals stated in the Contract Data and include
the forecast final measurement against each indicator.
X20.3 If the Consultant’s forecast final measurement against a Key Performance
Indicator will not achieve the target stated in the Incentive Schedule, he

y
submits his proposals for improving performance.

l
X20.4 The Consultant is paid the amount stated in the Incentive Schedule if the target

n
stated for a Key Performance Indicator is improved upon or achieved. Payment

o
of the amount is due when the target has been improved upon or achieved.
clauses
core

X20.5 The Employer may add a Key Performance Indicator and associated payment

e
to the Incentive Schedule but may not delete or reduce a payment stated in

s
the Incentive Schedule.

d u
option clauses

L t
main

gs
i n
option clauses
secondary

o l d
H
m
contract

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data

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E

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 Secondary Option Clauses

Option Y

Option Y(UK)2: The Housing Grants, Construction and Regeneration Act 1996

Definitions Y(UK)2
Y2.1 (1) The Act is the Housing Grants, Construction and Regeneration Act 1996.
(2) A period of time stated in days is a period calculated in accordance with
Section 116 of the Act.

Dates for payment Y2.2 The date on which a payment becomes due is seven days after the date of

l y
the Consultant’s invoice.

n
The final date for payment is fourteen days or a different period for payment if

o
stated in the Contract Data after the date on which payment becomes due.

clauses
Not later than five days after the date on which a payment becomes due, the

core
e
Employer issues a notice to the Consultant stating the amount of payment made

s
or proposed to be made, and the basis on which the amount was calculated.

u
Notice of intention to Y2.3 If either Party intends to withhold payment of an amount due under this

d
withhold payment contract, he notifies the other Party not later than seven days (the prescribed

option clauses
t
period) before the final date for payment by stating the amount proposed to

L
be withheld and the reason for withholding payment. If there is more than one

main
reason, the amount for each reason is stated.

s
A Party does not withhold payment of an amount due under this contract unless

g
he has notified his intention to withhold payment as required by this contract.

i n

option clauses
Suspension of Y2.4 If the Consultant exercises his right under the Act to suspend performance, it

secondary
d
performance is a compensation event.

o l
H
Option Y(UK)3: The Contracts (Rights of Third Parties) Act 1999

m
contract
o
data
k
Third party rights Y(UK)3

s
Y3.1 A person or organisation who is not one of the Parties may enforce a term of
this contract under the Contracts (Rights of Third Parties) Act 1999 only if

E
the term and the person or organisation are stated in the Contract Data.

Option Z: Additional conditions of contract

Additional conditions of Z1.1 The additional conditions of contract stated in the Contract Data are part of
contract this contract.

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 CONTRACT DATA

Part one – Data provided by the Employer

Completion of the data in full, according to the Options chosen, is essential to

create a complete contract.

Statements given in all

y
contracts

l
1 General . The conditions of contract are the core clauses and the clauses for main

n
Option . . . . . , dispute resolution Option . . . . . and secondary Options . . . . .

o
of the NEC3 Professional Services Contract (June 2005).
clauses
core

. The Employer is

s e
Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

u
Address . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
..............................................................

d
option clauses

t
. The Adjudicator is

L
main

Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

s
Address . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

g
..............................................................

i n
. The services are
option clauses
secondary

d
..............................................................

l
..............................................................

o
. The Scope is in

H
..............................................................
..............................................................

m
contract

o
. The language of this contract is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
data

k
. The law of the contract is the law of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

s
. The period for reply is . . . . . . . . . . . . weeks.

E
. The period for retention is . . . . . . . . . . . . . . . years following Completion or
earlier termination.
. The Adjudicator nominating body is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. The tribunal is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. The following matters will be included in the Risk Register
..............................................................
..............................................................

42 # copyright nec 2005 www.neccontract.com

 Contract Data

2 The Parties’ main . The Employer provides access to the following persons, places and things
responsibilities
access to access date
............................. .............................
............................. .............................
............................. .............................
............................. .............................

3 Time . The starting date is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4 Quality . The quality policy statement and quality plan are provided within . . . . . . . . .
weeks of the Contract Date.

y
. The defects date is . . . . . . . . . . . . . . weeks after Completion of the whole of

l
the services.

n
5 Payment . The assessment interval is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

clauses
. The currency of this contract is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

core
e
. The interest rate is . . . . . . % per annum (not less than 2) above the . . . . . .

s
. . . . . . . . . . . . . . . . . . . . . . . rate of the . . . . . . . . . . . . . . . . . . . . . . . . bank.

u
8 Indemnity, insurance . The amounts of insurance and the periods for which the Consultant main-

option clauses
and liability tains insurance are

L t

main
event cover period following
Completion of the

s
whole of the services

g
or earlier termination

i n

option clauses
failure of the Consultant

secondary
to use the skill and care .................... ..................

l d
normally used by
in respect of each
professionals providing

o
claim, without limit to
services similar to the
the number of claims

H
services

death of or bodily injury

m
to a person (not an .................... ..................

contract
o
data
employee of the
in respect of each

k
Consultant) or loss of or
claim, without limit to
damage to property

s
the number of claims
resulting from an action

E
or failure to take action
by the Consultant

death of or bodily injury to

employees of the .................... ..................
Consultant arising out of in respect of each
and in the course of their claim, without limit to
employment in connection the number of claims
with this contract

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 Professional Services Contract

. The Employer provides the following insurances

..............................................................
..............................................................
..............................................................
. The Consultant’s total liability to the Employer for all matters arising under or
in connection with this contract, other than the excluded matters, is limited to
..............................................................

Optional statements If the Employer has decided the completion date for the whole of the services
. The completion date for the whole of the services is . . . . . . . . . . . . . . . . . . . .

If no programme is identified in part two of the Contract Data

l y
. The Consultant is to submit a first programme for acceptance within . . . . . . .

n
weeks of the Contract Date.

o
If the Employer has identified work which is to meet a stated condition by a
clauses
core

key date

s e
. The key dates and conditions to be met are

u
condition to be met key date
1 ........................... .............................

d
option clauses

t
2 ........................... .............................

L
main

3 ........................... .............................

s
If the period in which payments are made is not three weeks and Y(UK)2 is

g
not used

i n
.
option clauses

The period within which payments are made is . . . . . . . . . . . . . . . . . . . . . . . .

secondary

l d
If Y(UK)2 is used and the final date for payment is not 14 days after the date
when payment is due

o
. The period for payment is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

H If the Employer states any expenses

m
. The expenses stated by the Employer are
contract

o
data

item amount

k
............................. .............................

s
............................. .............................

E
............................. .............................

If the Consultant is to provide additional insurances

. The Consultant provides these additional insurances
1. Insurance against . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cover is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Period of cover. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deductibles are . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. Insurance against . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cover is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Period of cover. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deductibles are . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

44 # copyright nec 2005 www.neccontract.com

 Contract Data

If the tribunal is arbitration

. The arbitration procedure is
..............................................................
. The place where arbitration is to be held is
..............................................................
. The person or organisation who will choose an arbitrator
. if the Parties cannot agree a choice or
. if the arbitration procedure does not state who selects an arbitrator is
..............................................................

If this contract is a subcontract and the main contract provides for joint

y
adjudication of disputes

l
. The main contract Adjudicator is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

If Option A is used

on

clauses
core
. The Consultant prepares forecasts of the total expenses at intervals no

e
longer than . . . . . . . . . . . . . . . . . . . . weeks.

If Option C, E or G is used
.

u s
The Consultant prepares forecasts of the total Time Charge and expenses at

option clauses
t
intervals no longer than . . . . . . . . . . . . . . . . . . . . . . . . . . . . weeks.

main
. The exchange rates are those published in . . . . . . . . . . . . . . . . . . . . . . . . . . .
on . . . . . . . . . . . . . . . . . . . . . . . . (date).

gs
If Option C is used

n
. The Consultant’s share percentages and the share ranges are

option clauses
secondary
share range Consultant’s share percentage

l d
less than . . . . . . . . . . . . . . . . . . . % ........................... %

o
from . . . . . . . . . % to . . . . . . . . . % ........................... %

H
from . . . . . . . . . % to . . . . . . . . . % ........................... %
greater than . . . . . . . . . . . . . . . . % ........................... %

m
contract
o
If Option X1 is used

data
k
. The index is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

s
If Option X2 is used

E
. The law of the project is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
..............................................................
..............................................................

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 Professional Services Contract

If Option X3 is used
. The Employer will pay for the items or activities listed below in the
currencies stated
items and activities other currency total maximum payment
in the currency
1 ....................... ............. ....................
2 ....................... ............. ....................
3 ....................... ............. ....................

. The exchange rates are those published in . . . . . . . . . . . . . . . . . . . . . . . . . . .

on . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (date)

l y
If Option X5 is used

n
. The completion date for each section of the services is

o
section description completion date
clauses
core

1 ......................... ..........................

s e
2 ......................... ..........................

u
3 ......................... ..........................
4 ......................... ..........................

d
option clauses

t
5 ......................... ..........................

L
main

If Options X5 and X6 are used together

s
. The bonuses for each section of the services are

g
section description amount per day

i n
option clauses

1 ......................... ..........................
secondary

l d
2 ......................... ..........................

o
3 ......................... ..........................

H
4 ......................... ..........................
5 ......................... ..........................

m
contract

Remainder of the services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

o
data

k
If Options X5 and X7 are used together

s
. Delay damages for each section of the services are

E
section description amount per day
1 ......................... ..........................
2 ......................... ..........................
3 ......................... ..........................
4 ......................... ..........................
5 ......................... ..........................

Remainder of the services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

46 # copyright nec 2005 www.neccontract.com

 Contract Data

If Option X6 is used (but not if Option X5 is also used)

. The bonus for the whole of the services is . . . . . . . . . . . . . . . . . . . . . per day.

If Option X7 is used (whether or not Option X5 is also used; used only with
main Options A, C and E)
. Delay damages for Completion of the whole of the services are . . . . per day.

If Option X8 is used
. The collateral warranty agreements are
agreement reference third party
............................. .............................
............................. .............................

l y
............................. .............................

n
............................. .............................

clauses
If Option X10 is used

core
e
. The Employer’s Agent is

s
Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

u
Address . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

option clauses
t
..............................................................

main
..............................................................
. The authority of the Employer’s Agent is

gs
..............................................................

i n

option clauses
If Option X12 is used

secondary
d
. The Client is

l
Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

o
Address . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

H
..............................................................
. The Client’s objective is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

m
contract
o
..............................................................

data
k
..............................................................

s
..............................................................

E
..............................................................
..............................................................
..............................................................
. The Partnering Information is in . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
..............................................................
..............................................................
..............................................................
..............................................................
..............................................................

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 Professional Services Contract

If Option X13 is used

. The amount of the performance bond is . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

If Option X18 is used

. The Consultant’s liability to the Employer for indirect or consequential loss
is limited to . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. The Consultant’s liability to the Employer for Defects that are not found until
after the defects date is limited to . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. The end of liability date is . . . . . . . . . . . . . . . . . . . . . . years after Completion
of the whole of the services.

If Option X20 is used (but not if Option X12 is also used)

y
. The incentive schedule for Key Performance Indicators is in . . . . . . . . . . . . .

l
. A report of performance against each Key Performance Indicator is provided

n
at intervals of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . months

o
clauses

If Option Y(UK)3 is used

core

e
. term person or organisation

s
........................... .............................

u
........................... .............................

d
option clauses

t
........................... .............................

L
main

........................... .............................

s
If Option Z is used

g
. The additional conditions of contract are . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

i n
option clauses

..............................................................
secondary

o l d
H
m
contract

o
data

s k
E

48 # copyright nec 2005 www.neccontract.com

 Contract Data

Part two – Data provided by the Consultant

Completion of the data in full, according to the Options chosen, is essential to

create a complete contract.

Statements given in all . The Consultant is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

contracts
Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Address . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
..............................................................
..............................................................

l y
. The key persons are

n
(1) Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

o
Job . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

clauses
core
e
Responsibilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

s
Qualifications. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

u
Experience . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

option clauses
(2) Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

t
Job . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

main
Responsibilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

s
Qualifications. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

g
Experience . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

i n

option clauses
. The staff rates are

secondary
l d
name/designation rate

o
............................. .............................

H
............................. .............................

. The following matters will be included in the Risk Register

m
contract
..............................................................

o
data
k
..............................................................

s
..............................................................

E
..............................................................

Optional statements If the Consultant is to decide the completion date for the whole of the services
. The completion date for the whole of the services is . . . . . . . . . . . . . . . . . . . .

If a programme is to be identified in the Contract Data

. The programme identified in the Contract Data is . . . . . . . . . . . . . . . . . . . . . .

If the Consultant states any expenses

. The expenses stated by the Consultant are
item amount
............................. .............................
............................. .............................

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 Professional Services Contract

If the Consultant requires additional access

. The Employer provides access to the following persons, places and things
access to access date
............................. .............................
............................. .............................

If Option A or C is used
. The activity schedule is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

If Option G is used
. The task schedule is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

n l y
o
clauses
core

s e
d u
option clauses

L t
main

gs
i n
option clauses
secondary

o l d
H
m
contract

o
data

s k
E

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 Professional Services Contract

Index by clause numbers (Option clauses indicated by their letters, main clause heads by bold numbers).
Terms in italics are identified in Contract Data, and defined terms have capital initial letters.

acceleration 34, A34.3, C34.3, E34.4 resignation of W1.2(3)

acceptance 14 tribunal W1.3(2)(10), W2.3(11)
communications 13.1 tribunal reviews W1.4(1ÿ4)(6), W2.4(1ÿ3)(5)
programme 31.3, G31.5 adjustment factor, price X1
reason for non acceptance of people 22.1 administration orders, termination 90.1
revised programme 32.2 administrative receivers, termination 90.1
Subconsultants 24.2ÿ3 Agent, Employer’s X10

l y
withholding 13.4, 60.1(8) agents of Adjudicator W1.2(5), W2.2(5)
Accepted Programme agreement, Parties 12.4

n
Activity Schedule A53.2, A53.3, C53.2, C53.3 ambiguities 16

o
compensation events 60.1(3)(5)(11), 62.2, 63.3, compensation events G60.2
63.7, 64.2 amount due

e
Employer’s compensation event assessments 64.2 assessing 50, C50.4, G50.4

s
Employer’s obligations 20.1 definition 50.3
identified and defined terms 11.2(1) expenses adjustment X1.6

u
Providing the Service prevention 18.1 payment on termination C92.3
working together X12.3(7) price adjustment X1.1ÿ4

td
see also programme termination 90.2, 92.1ÿ2, C92.3, X11.2
access date approval from Others, Consultant 25.1

L
Parties’ responsibilities 25.2 arbitration procedure W1.4(5), W2.4(4)
in programme 31.2 arrangement with creditors, termination 90.1

s
access to person/place or thing assessment

g
by Employer to Consultant 25.2 acceleration quotation 34.1

n
non provision 60.1(2) Adjudicator W1.3(7), W2.3(7)

i
Providing the Services 31.2 amount due 50, C50.4, E50.4, G50.4

d
shown in programme 31.2 compensation events 61.6, 62.2, 63, A62.7,

l
accounts and records A52.1, C52.2, E52.2, G52.2 A63.12, A63.14ÿ15, C63.13ÿ14, G62.7,

o
actions 10 G63.16ÿ18
Activity Schedule A53.1ÿ3, C53.1ÿ3 interest 51.4

H
compensation event assessment C63.14 Tasks G55.1ÿ3
identified and defined terms A11.2(14)(18), assessment date
C11.2(14)(18) amount due assessment 50.1

m
programme A31.4, C31.4 delay damages X7.4

o
activity schedule, identified and defined terms invoice submission 50.1

k
A11.2(14), C11.2(14) assessment internal 50.1

s
Acts
Contracts (Rights of Third Parties) (1999) Y(UK)3 bankruptcy, termination 90.1

E
Housing Grants, Construction and Regeneration binding decisions, Adjudicator W1.3(10), W2.3(11)
(1996) W1, W2, Y(UK)2 bodily injury, limitation of liability 81.1, 82.1
additional conditions of contract Z1.1 bonds X13.1
additional costs bonus for early Completion X6
Employer’s right to recover 23.3
work not meeting Condition 23.3 calculation
addresses 13.2 assessing amount due C50.4, G50.4
adjudication Consultant’s share C50.4
dispute resolution W1.3(1ÿ11), W2.3(1ÿ12) care see skill and care
timings W1.3(8)(10-11), W2.3(2-3)(8)(10ÿ12) certificates
Adjudication Table W1.3(1) communications 13.1
Adjudicator insurance cover 81.2
dispute resolution W1.2(1-5), W2.2(1ÿ5) changed decisions, compensation events 60.1(7),
identified and defined terms 11.2(7) 61.1ÿ2
nominating body W1.2(3), W2.2(3) changes
not arbitrator W1.2(2), W2.2(2) conditions of contract 12.3
replacement W1.2(4), W2.2(4) Key Date 20.2

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 Professional Services Contract

changes (continued) implementation A65.3, C65.3, E65.4

in the law X2 notification 61.3ÿ4
Partnering Information X12.3(6) quotations 62.2
Scope 15.4, 17.1, 20.2 delay damages X7.1ÿ2
to this contract 12.3 identified and defined terms 11.2(2), 11.2(3)
changes of Prices implementing compensation events A65.3, C65.3,
acceleration 34.1, A34.3 E65.4
compensation events A63.12, A63.14, C65.3 price adjustment factor X1.1
Client revised in acceleration quotation 34.1
defined terms X12.1(1) Sectional Completion X5.1
incentives X12.4(2) shown in programme 31.2
Client’s objective X12.2(1) time 30.1
Client’s representative X12.2(4) completion date, identified and defined terms 11.2(3)
co-operation Condition
actions 10.1 assessing compensation events 63.3, 63.9

l y
with Others 23.1 identified and defined terms 11.2(6)
Partnering X12.3(1) condition, identified and defined terms 11.2(6)

n
risk reduction meetings 15.3 Condition

o
code of conduct 20.3 Key Dates 30.3
collateral warranty agreements X8 shown in programme 31.2

e
communications 13 work not meeting 23.3

s
Adjudicator W1.3(6), W2.3(6) conditions of contract
compensation events 60.1(6) additional Z1.1

u
compensation events 60ÿ5, G60 changes 12.3
acceptance withholding 13.8, 60.1(8) Sectional Completion X5.1

td
applicable events 60.1 Construction and Regeneration Act (1996) W1, W2,
assessment 63ÿ4, 65.2, A62.7, A63.12, Y(UK)2

L
A63.14ÿ15, C63.13ÿ14, G63.16ÿ18 Consultant
assumptions 60.1(9), 61.6 accounts and records A52.1, C52.2, E52.2, G52.2

s
changes in the law X2.1 actions 10.1

g
defined 60.1, G60.1 Activity Schedule C53.2

n
early warning matters 15.1 adjudication W1.3(1ÿ2)(4)(7), W2.3(3)(7)

i
Employer’s assessments 64 assessing amount due E50.4, G50.4

d
events which are G60.1 bonus for early Completion X6.1

l
implementing 65, A65.3, C65.3, G65.5 collateral warranty agreements X8.1

o
not providing access to person, place or thing compensation events C63.13, G60.1(14)
60.1(2) correction of Defects 41.1ÿ2

H
notifying 61 dates for payment Y2.2
performance suspension Y2.4 Defects notification 41.1
price adjustment X1.5 delay damages X7.1, X7.3

m
quotations 62, A62.7, G62.7 early warning matters 15.1

o
time 62.3ÿ6 Employer indemnity 80.1

k
withholding acceptance 13.8, 60.1(8) Employer’s Agent X10.2

s
see also indemnity identified and defined terms 11.2(7)(12),
Completion G11.2(21)(22)

E
acceleration 34.1 incentives X20.2ÿ4
assessing amount due 50.1 infringement of rights of Others 80.1
on or before Completion Date 30.1 instruction to comply with quality plan 40.3
bonus for early Completion X6.1 insurance cover 81.1
compensation event notification 61.4 liability limitation 82.1ÿ2, X18.1ÿ3
Consultant’s obligations A21.3, C21.4, E21.4, multiple currencies X3.1ÿ2
G21.4 obeying instructions from Employer 25.3
Consultant’s share C54.3ÿ4 obligations 21, A21.3, C21.4, E21.4, G21.4
delay damages X7.1 obtaining approval from Others 25.1
identified and defined terms 11.2(2) parent company guarantee X4.1
Sectional Completion X5.1 payment assessment 51.3
shown in programme 31.2 performance X4.1
Completion Date performance bonds X13.1
acceleration A34.3, C34.3 performance suspension Y2.4
bonus for early Completion X6.1 period for reply 13.3
compensation events G60.1(15) price adjustment factor X1.1
assessing 63.4, 63.8 programme A31.4, C31.4, G31.5

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 Index

Providing the Services 14.1 currency of this contract

reply to communications 13.3 assessing amount due C50.4, E50.4, G50.4
responsibility to Provide the Services 14.1 multiple currencies X3.1ÿ2
retaining documents 13.6 payment 51.2
risk notification 11.2(10)
Subconsulting 24.1ÿ3, E24.4 damages
Task assessment G55.1, G55.3 delay X7
Task Order G55.1 property 82.1
termination by the Employer X11.1 Task Orders G55.2
transfer of rights X9.1 dates for payment Y2.2
working together X12.3(7) dates in programme 31.2
Consultant’s share C54.1ÿ4 death, limitation of liability 81.1, 82.1
calculation C50.4 decision changes, compensation events 60.1(7),
limitation of liability 82.1 61.1ÿ2
payment on termination C92.3 deductions, assessing compensation events 63.11

l y
content Defect(s)
programme 31.2 compensation events 60.1(13)

n
revised programme 32.1 correction 41, 41.2

o
Contract Data/contract data identified and defined terms 11.2(2)(5),
additional conditions of contract Z1.1 G11.2(22)

e
Adjudicator identified W1.2(3), W2.2(3) defects date

s
bonus for early Completion X6.1 assessing amount due 50.1
communications 13.2 compensation event notification 61.7

u
conditions of contract Z1.1 correcting Defects 41.1
Consultant’s obligations A21.3, C21.4, E21.4, G21.4 incentives X20.2

td
dates for payment Y2.2 defined terms 11, A11.2, C11.2, G11.2
delay damages X7.1 delay damages 82.1, G55.2, X7

L
Employer’s Agent X10.1 delayed payment 51.4
identified and defined terms 11.1, 11.2(1)(6)(10) disagreement, payment 51.4

s
insurance cover 81.1 dispute resolution

g
key person employment 22.1 unless United Kingdom Housing Grants,

n
liability limitation X18.1ÿ2 Construction and Regeneration Act (1996)

i
multiple currencies X3.1ÿ2 applies W1

d
non-acceptance reason C24.4 when United Kingdom Housing Grants, Construction

l
performance bonds X13.1 and Regeneration Act (1996) applies W2

o
period for payment 51.1 documents, period of retention 13.6
programme not identified in 31.1

H
providing access to person/place or thing 25.2 early Completion bonus X6
quality management system 40.2 early warning 15
subconsulting C24.4, E24.4 compensation events 61.5, 63.5

m
third party rights Y3.1 matters 11.2(10), 15.1

o
Contract Date Partners working together X12.3(3)

k
changes in the law X2.1 employees

s
compensation events 60.1(11), X1.5 of Adjudicator W1.2(5), W2.2(5)
expenses adjustment X1.6 of Consultant 22.2

E
experienced consultant’s judgement 18.1 removing 22.2
identified and defined terms 11.2(4) Employer
insurance cover 81.1 acceleration 34.1, A34.3, C34.3, E34.4
parent company guarantee X4.1 accepting programme 31.3, 32.2
performance bonds X13.1 access to person/place or thing 25.2
price adjustment factor X1.1 accounts and records C52.2, G52.2
termination 90.4 actions 10.1
Contracts (Rights of Third Parties) Act (1999) Y(UK)3 Activity Schedule A53.2, C53.2
Core Group X12.1(3), X12.2(3-5) adjudication W1.3(1-5)
correcting Defects 41 Adjudicator’s reviews/revisions W2.3(4)
correcting failures 40.3 assessing compensation events 64, C63.13,
costs, Defect correction 41.2 G63.18
costs (compensation events) certifying date of Completion 30.2
assessing 63.11 communication acceptance 14.1
notification 61.4 compensation events 60.1(1-10)(12), 61.1ÿ6,
quotations A62.7, G62.7 G60.1(13), G60.2
currencies, multiple X3.1ÿ2 assessing 64, C63.13, G63.18

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 Professional Services Contract

Employer (continued) extension, period for reply 13.5

implementing G65.5
Consultant’s obligations A21.3, E21.4, G21.4 failure to comply with obligations 90.3
Consultant’s share C54.1, C54.3ÿ4 failure to correct 40.3
correction of Defects 41.1ÿ2 failure to meet the Conditions 23.3
date of Completion decision 30.2 final payment 91.1, 92.1
dates for payment Y2.2 final Price for Services Provided to Date C54.3ÿ4
Defects notification 41.1 final total of the Prices G65.5
delay damages X7.2, X7.4 first assessment 50.1, 51.4
early warning matters 15.1 float 31.2
Employer’s Agent X10.1ÿ2 forecasts
identified and defined terms 11.2(7), acceleration E34.4
G11.2(21)(22)(24) Consultant’s obligations A21.3, C21.4, G21.4
implementing compensation events G65.5 Consultant’s share C54.3
incentives X20.2, X20.5 implementing compensation events E65.4

l y
inspecting accounts and records C52.2, G52.2 incentives X20.2
liability limitation 82.1ÿ2, X18.1ÿ3 termination by the Employer X11.2

n
not accepting amount due 51.3

o
obligations 20 guarantee, parent company X4.1
parent company guarantee X4.1

e
payment on termination C92.3 health and safety

s
performance bonds X13.1 Parties’ responsibilities 25.4
period for reply 13.3 requirements in programme 31.2

u
provided with quality policy statement 40.2 Housing Grants, Construction and Regeneration Act
providing access to person/place or thing 25.2 (1996) W1, W2, Y(UK)2

td
publicity 71.1
reply to communications 13.3 identified and defined terms 11, A11.2, C11.2, E11.2,

L
request for acceleration quotation 34.1 G11.2
revising Risk Register 15.4 illegal requirements 17

s
right to recover additional costs 23.3 implementing compensation events 65, A65.3, C65.3,

g
risk notification 11.2(10) E65.4, G65.5

n
subconsulting C24.4, E24.4 impossible requirements 17

i
Task assessment G55.1ÿ2 Incentive Schedule X20.1, X20.3ÿ5

d
termination 90.2ÿ4, 92.2, X11 incentive schedule X20.1

l
transfer of rights X9.1 incentives X12.4, X20.1ÿ5

o
use of materials 70.1ÿ2 inconsistencies 16, G60.2
withholding acceptance 13.8 indemnity 80

H
working with 23 index, price adjustment factor X1.1
see also co-operation inflation X1
Employer’s Agent X10 information

m
employment Activity Schedule A53.1, C53.1

o
key person 22.1 after termination 91.1

k
replacement person 22.1 Parties’ use of materials 70.3

s
end of liability date X18.3 programme 31.2, G31.5
errors, Adjudicator W1.3(11) shown in programme 31.2

E
excess payments see also Partnering Information
Consultant’s share C54.2 infringement of rights of Others 80.1
multiple currencies X3.2 inspection, accounts and records A52.1, C52.2,
on termination C92.3 E52.2, G52.2
exchange rates C50.4, E50.4, X3.1 instructions
expenses assessing compensation events 63.1
accounts and records A52.1, C52.2, E52.2, to attend risk reduction meetings 15.2
G52.2 communications 13.1
adjustment X1.6 Consultant complying with quality plan 40.3
assessing amount due 50.3 Consultant obeying 25.3
Consultant’s obligations A21.3, C21.4, E21.4, to re-start work 33.1
G21.4 to stop/not start work 33, 60.1(4)
experienced consultant that change Key Date/Scope 20.2
compensation events 60.1(11), 61.5, 63.5 insurance cover 81
early warning 63.5 Insurance Table 81.1
prevention 18.1 interest
termination 90.4 assessment 51.4

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 Index

calculation 51.5 not starting work instructions 33, 60.1(4)

delay damages X7.4 notices
payment 51.4 amount of payment Y2.2
interest rate 51.5 dates for payment Y2.2
interpretation, law 12 withholding payment Y2.3
invoices notification
amount due 50.1ÿ2 adjudication W1.3(1ÿ2)(4b)(8-10),
dates for payment Y2.2 W2.3(1ÿ3)(8ÿ11)
part payment 51.3 communications 13.1
payment 51.1, 51.3 compensation events 61, 62.6
submission 50.1ÿ2 implementing A65.3, C65.3, G65.5
implementing compensation events A65.3, C65.3,
key date 11.2(6) G65.5
Key Dates separate communication 13.7
acceleration 34.1, A34.3, C34.3, E34.4 termination 90.1, X11.1

l y
compensation events 60.1(4), 61.3ÿ4, 62.2,
63.3ÿ4, 63.8ÿ9 obtaining approval from Others 25.1

n
implementing A65.3, C65.3, E65.4 order and timing of operations/work, shown in

o
Employer’s obligations 20.2 programme 31.2
identified and defined terms 11.2(6) other Party

e
in programme 31.2 insurance cover 81.2

s
time 30.3 termination 90.1
working with Employer/Others 23.3 Others

u
Key Performance Indicators co-operation 23.1
definition X12.1(5), X20.1 compensation events 60.1(5)

td
incentives X12.4(1-2), X20.1ÿ5 identified and defined terms 11.2(2)(7)
key person 22.1 working with 23

L
Own Contract
language of the contact 13.1 definition X12.1(2)

s
late payment 51.4 incentives X12.4(1)

g
later assessment dates 50.1 Partnering X12.3(2)(8)

n
latest programme 11.2(1)

i
law 12, X2 parent company guarantee X4

d
see also Acts part payment, invoices 51.3

l
law of the contract 12.2, 82.1 Parties/Party

o
liability limitation 82, 81.1, X18.1ÿ3 Adjudicator’s communications W1.3(6), W2.3(6)
liquidators 90.1 Adjudicator’s instructions W1.3(5), W2.3(4)

H
loss of property 82.1 agreement 12.4
lump sums A11.2(18), C11.2(18), G11.2(17)(20), assessing amount due 50.1
X1.4 changes in the law X2.1

m
compensation events 60.1(11)(12)

o
main responsibilities, Parties 20ÿ5 identified and defined terms 11.2(8)

k
management system, quality 40 information disclosure 70.3

s
materials insurance cover 81.2
rights to 70ÿ1 main responsibilities 20ÿ5

E
on termination 91.1 Partnering X12.2(6)
use by Parties 70 termination 90.1, 90.4, 91.1
meetings with Others, Providing the Services 23.2 third party rights Y3.1
multiple currencies X3.1ÿ2 tribunal reviews W1.4(1ÿ4), W2.4(1ÿ3)(5)
use of materials 70
national legislation Y withholding payment notice Y2.3
NEC Adjudicator’s Contract W1.2(1), W2.2(1) Partnering X12
NEC contract, subconsulting C24.4, E24.4 actions X12.2
nominating body, Adjudicator W1.2(3), W2.2(3) Core Group X12.2(3-5)
non acceptance of defined terms X12.1
Activity Schedule revision C53.3 early warning X12.3(3)
people 22.1 identified and defined terms X12.1
programme 31.3 incentives X12.4
Subconsultants 24.2ÿ3 Key Performance Indicators X12.4(1ÿ2)
not paying amount due 90.2 representatives X12.2(2)
not providing access to person, place or thing subcontracting X12.3(9)
60.1(2) timetable X12.3(7)

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 Professional Services Contract

Partnering Information professional code of conduct 20.3

actions X12.2(3) programme 31, A31.4, C31.4, G31.5
defined terms X12.1(4) contents 31.2
working together X12.3(1)(4)(6) Employer’s compensation event assessments
Partner’s Own Contract X12.4(1) 64.2
partnerships, termination 90.1 implementing compensation events G65.5
payment 51 revision 32, 34.1
assessing amount due C50.4, E50.4, G50.4 see also Accepted Programme
dates Y2.2 proposals, communications 13.1
delayed 51.4 providing access to person/place or thing 25.2, 31.2,
disagreement 51.4 60.1(2)
incentives X12.4(1-2), X20.4ÿ5 Providing the Services
late 51.4 access to person/place or thing 31.2
on termination 92, C92.3 assessing amount due 50.3
Time Charge C50.4 Consultant’s obligations 21.1

l y
people Consultant’s responsibility 14.1
responsibilities 22 Employer’s obligations 20.2

n
see also employees identified and defined terms 11.2(9)

o
performance see also Key Performance Indicators meetings with Others 23.2
performance bonds X13.1 Parties’ responsibilities 25.1

e
performance suspension Y2.4 Parties’ use of materials 70.2

s
period for payment 51.1 prevention 18.1
period for reply quality management system 40.1

u
acceleration 34.2 Subconsulting 24.1ÿ3, C24.4, E24.4
communications 13.3, 13.4 termination 90.1ÿ4, 91.1, X11.1

td
Consultant 13.3 provisional liquidators 90.1
Employer 13.3 provisions in programme 31.2

L
extension 13.5 publicity 71
quotations 34.2

s
period of retention, documents 13.6 qualifications, people 22.1

g
period of time, definition Y2.1(2) quality 40ÿ1

n
plan, quality 40.2 management system 40

i
policy statement, quality 40.2 plan 40.2

d
prevention 18 policy statement 40.2

l
price adjustment factor X1 quotations

o
Price for Services Provided to Date for acceleration 34.1ÿ2, A34.3
Consultant’s share C54.1ÿ4 compensation events 61.2, 61.5ÿ6, 62, 63.10,

H
identified and defined terms A11.2(15), C11.2(16), 64.1, 65.1, A62.7, G62.7
E11.2(16), G11.2(17) outside period for reply 34.2
payment on termination C92.3

m
price adjustment X1.2ÿ4 rates

o
Prices assessing amount due G50.4

k
acceleration 34.1, A34.3, C34.3 re-starting work instructions 33.1

s
Activity Schedule A53.3, C53.3 reasons for not accepting
assessing amount due 50.3 contract data C24.4, E24.4

E
changes due to acceleration quotation 34.1 people 22.1
changes in the law X2.1 subconsulting E24.4
compensation events G60.1(13) receivers 90.1
assessment 63.1ÿ2, 63.4, 63.8, A63.12, records A52.1, C52.2, E52.2, G52.2
A63.14, C63.13ÿ14, G63.17ÿ18 communications 13.1
implementation A65.3, C65.3, E65.4, G65.5 risk reduction meetings 15.4
notification 61.3ÿ4 referral, adjudication W1.3(1ÿ3), W2.3(1ÿ3)
quotations 62.2 removing employees of Consultant 22.2
Consultant’s share C54.1ÿ4 replacement of Adjudicator W1.2(4), W2.2(4)
identified and defined terms A11.2(15)(18), replacement person 22.1
C11.2(18), E11.2(19), G11.2(20) replies, communications 13.1
Task assessment G55.1 reports X20.2
termination by the Employer X11.2 resignation of Adjudicator W1.2(3), W2.2(3)
working together X12.3(6-7) resources planned to use 31.2
procedures resubmissions, communications 13.4
in programme 31.2 retaining documents 13.6
termination 91 reviews, tribunal W1.4(1ÿ6), W2.4(1ÿ5)

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 Index

revised programme 32 Sectional Completion X5.1

acceleration 34.1, A34.3, C34.3, E34.4 termination 90.3ÿ4, 91.1
content 32.1 total expenses A21.3
revised quotations 62.4 Services Provided to Date 50.3
rights to materials 70ÿ1 see also Price for Services Provided to Date
rights of Others 80.1 share percentage C54.1
Rights of Third Parties (Contracts) Act (1999) share ranges C54.1
Y(UK)3 skill and care 21.2
risk allowances staff rates
assessing compensation events 63.6 assessing compensation events 63.10
working together X12.3(8) compensation events X1.5
risk notification 11.2(10) identified and defined terms 11.2(13)
risk reduction meetings starting date 30.1
co-operation 15.3 assessing amount due 50.1
early warning 15.3 Consultant’s obligations A21.3, C21.4, E21.4,

l y
instructions to attend 15.2 G21.4
recording decisions 15.4 dispute resolution W1.2(1), W2.2(1)

n
Risk Register incentives X20.2

o
early warning matters 15.1 Key Performance Indicators X20.2
Employer revising 15.4 shown in programme 31.2

e
identified and defined terms 11.2(10) stopping work 33, 60.1(4)

s
subconsultancy, termination 91.1
safety see health and safety Subconsultant

u
savings identified and defined terms 11.2(7)(12)
Consultant’s share C54.2 transfer of rights X9.1

td
payment on termination C92.3 use of materials 70.1ÿ2
Schedule of Core Group Members X12.1(3) Subconsulting 24, C24.4, E24.4

L
Schedule of Partners X12.1(1) subcontract, adjudication W1.3(4), W2.3(3)
incentives X12.4(1-2) subcontracting X12.3(9)

s
working together X12.3(3) submission(s)

g
Scope communications 13.1, 13.4

n
Activity Schedule A53.1, C53.1 compensation event quotations 62.1

i
assessing amount due 50.2 first programme to Employer 31.1

d
assessing compensation events 63.8ÿ9, invoices 50.1ÿ2

l
A63.12 programme to Employer 31.1, 31.3

o
changes 15.4, 17.1 replacement people 22.1
communications 13.6 revised programme to Employer 32.2

H
compensation events 60.1(1)(5), 63.8ÿ9, A63.12, suppliers, identified and defined terms 11.2(7)
C63.13
Consultant’s obligations 21.1 Task

m
Employer’s obligations 20.2 assessment G55.1ÿ3

o
health and safety 25.4 identified and defined terms G11.2(17)(21)(24)

k
identified and defined terms 11.2(2)(5)(11) implementing compensation events G65.5

s
parent company guarantee X4.1 programme G31.5
Parties’ use of materials 70.1, 70.4 Task Completion

E
performance bonds X13.1 compensation event assessment G63.16
quality management system 40.1ÿ2 delay damages X7.3
transfer of rights X9.1 identified and defined terms G11.2(22)
Sectional Completion X5 Task assessment G55.2ÿ3
services Task Completion Date
acceleration E34.4 compensation events G60.1(15), G63.16,
Activity Schedule A53.2, C53.2 G65.5
assessing amount due 50.1 delay damages X7.3, X7.4
co-operation with Others 23.1 identified and defined terms G11.2(22)(23)
compensation events 60.1(11)(12) implementing compensation events G65.5
Consultant’s obligations A21.3, C21.4, E21.4, Task assessment G55.2ÿ3
G21.4 Task Orders
Consultant’s share C54.3ÿ4 compensation events G60.1(13)(14)
identified and defined terms G11.2(21)(22) delay damages G55.2, X7.3
Parties’ use of materials 70.3 identified and defined terms G11.2(23)(24)
price adjustment factor X1.1 Task assessment G55.1ÿ3
publicity 71.1 Task price list G55.2

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 Professional Services Contract

Task Schedule Consultant’s share C54.1, C54.3ÿ4

compensation events G60.2, G63.17 implementing compensation events G65.5
identified and defined terms G11.2(17)(20)(25) Task assessment G55.1
Task assessment G55.2 total Time Charge
task schedule G11.2(25) acceleration E34.4
taxation 50.3 compensation event assessment A63.12, C63.13,
termination 90ÿ2 G63.18
by Employer X11 Consultant’s obligations C21.4, E21.4, G21.4
payment on 92, C92.3 payment on termination C92.3
procedures 91 transfer of rights X9
third party rights, 1999 Act Y3.1 tribunal
time 30ÿ4, W2.1(2) Adjudicator W1.3(2)(10), W2.3(11)
compensation events 61.3ÿ4, 62.3ÿ6, 64.3ÿ4 arbitration W1.4(5), W2.4(4)
payment 51.1 reviews W1.4(1ÿ6), W2.4(1ÿ5)
termination 90.3ÿ4 trust and co-operation

l y
see also Key Dates; period of time actions 10.1
time allowed Partnering X12.3(1)

n
dates for payment Y2.2

o
performance bonds X13.1 undecided disputes, Adjudicator W1.2(4), W2.2(4)
withholding payment notice Y2.3 United Kingdom Housing Grants, Construction and

e
Time Charge Regeneration Act (1996) W1, W2

s
accounts and records C52.2, E52.2, G52.2
assessing amount due C50.4, E50.4, G50.4 warranty agreements, collateral X8

u
changes in the law X2.1 whole of the services
compensation events C63.13, G60.1(13), G63.18, Consultant’s obligations C21.4, E21.4, G21.4

td
X1.5 Consultant’s share C54.3ÿ4
assessing 63.1ÿ2, A63.12 winding-up orders 90.1

L
Consultant’s obligations C21.4, E21.4, G21.4 withholding acceptance 13.4, 13.8, 60.1(8)
identified and defined terms 11.2(13), withholding payment, notices Y2.3

s
E11.2(16)(19), G11.2(17)(20) witnesses, tribunal proceedings W1.4(6), W2.4(5)

g
payment on termination C92.3 word interpretation 12.1

n
time extensions, compensation events 62.5 work

i
time risk allowances 31.2 instructions to stop/not start 33, 60.1(4)

d
timings, adjudication W1.3(8)(10-11), W2.3(2- re-starting instructions 33.1

l
3)(8)(10ÿ12) work done/not yet done, assessing compensation

o
total expenses, Consultant’s obligations A21.3 events 63.7
total of the Prices working with Employer and Others 23

H
Activity Schedule C53.3 see also trust and co-operation

o m
s k
E

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