Case 03

Existing Delay + Compensation Event

  • Existing Delay
  • Causation
  • Double Counting
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The commercial question

“The project was already late before the CE. How much of the later delay actually belongs to the CE?”

Illustrative scenarios

These are independently created fictional scenarios for professional learning. Figures and conclusions are illustrative, not project-specific assessments or standard rates.

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Project scenario

NEC4 ECC Option A

Original planned Completion: 30 September.

By the relevant dividing-date assessment position, the project has already experienced Contractor-related delay including late mobilisation, lower-than-planned productivity and a subcontractor resource shortage.

The assessment starts with the Accepted Programme current at the dividing date and the relevant progress, delays and remaining-work position up to that date. In this scenario, that produces a pre-CE forecast planned Completion of 14 October.

A later PM Scope change then causes M&E interface changes, fragmented working, temporary works, resequencing, return visits, lower productivity and later testing activities.

The Contractor forecasts planned Completion after the CE as 11 November.

Contractor position

The Contractor presents the movement from the original 30 September planned Completion to 11 November as approximately six weeks of CE delay. The commercial submission is:

£194,000

Total before Fee

Contractor submission
Direct changed work£84,000
Disruption£38,000
Prolongation£72,000
Total before Fee£194,000

What would you challenge first?

  • Existing Contractor delay cannot simply be transferred into a later CE.

  • The relevant dividing-date programme position matters.

  • Disruption and prolongation may both arise as effects of the same CE.

  • The same resource or period must not be recovered twice through overlapping disruption and prolongation allowances.

Key commercial principle

Key commercial principle

“Existing delay does not belong to a later CE — but existing delay does not automatically eliminate the later CE’s own effect.”

Do not treat 14 October as the answer: The movement from 14 October to 11 November is not automatically the CE entitlement. The Contractor still needs to demonstrate that the movement is caused by the current CE rather than overlapping delay or other events.

Commercial Desk headline diagnosis

Commercial Desk headline diagnosis

Significant programme and cost separation required.

One Compensation Event may create multiple effects — direct changed work, labour and resource effects, plant, disruption, resequencing, temporary works, programme delay and prolongation. Those effects are not automatically separate Compensation Events.

How the conceptual comparison works

Without CE

Raw resource / cost position → Applicable SCC / SSCC rules → Without-CE Defined Cost

With CE

Raw resource / cost position → Applicable SCC / SSCC rules → With-CE Defined Cost

Identify the CE-caused Defined Cost effect, then apply the applicable Fee treatment.

See the Worked Commercial Solution

Full Worked Solution

Part of the upcoming NEC4 Compensation Events Pack.

The Pack includes:

  • Cases 01–06 full Worked Solutions
  • Main Option A–F impact analysis (not six recalculated versions of each Case)
  • Advanced Option B/D Quantity-change Module where applicable
  • Structured evidence and commercial assessment guidance
  • Example response wording

Planned launch price: £79 one-off. No subscription. Coming soon.

Based on the standard NEC4 ECC framework. Always check the applicable Contract Data, secondary Options, Y clauses, Z clauses, local amendments and governing law before applying the worked examples to a live contract.

Related Commercial Desk tools

Programme Assessment

Review the programme basis before using a time period commercially.

Quotation Review

Check whether a CE quotation looks commercially complete.

Commercial Desk is an independent practical reference for construction professionals. It is not affiliated with or endorsed by NEC. It does not reproduce the NEC4 contract and is not a substitute for the applicable executed contract or professional or legal advice. Always check the relevant contract, Contract Data and amendments.