The NEC Engineering and Construction Contract (ECC)

Formerly the New Engineering Contract (NEC)

The New Engineering Contract was a completely new contract form for construction. It was commissioned by the Institution of Civil Engineers in 1986 as a result of a fundamental review of alternative contract strategies........... ..identifying the needs for good practice.
1st edition 1993 3rd edition 2005 is current It departs from traditional drafting

Presentation & Layout

Presentation:
Simple language in the present tense as opposed to legalistic wording

No cross referencing
Use of bullet points Emphasis is on what the parties must do in various situations

Comment from the contract draftsman (Dr Martin Barnes) ECC is a project management system - its legality is a by-product

Some lawyers claim lack of certainty in the wording of NEC

The overall structure of the contract is different from traditional contracts and consists of the following elements:

Core Clauses Main Option Clauses Secondary Option Clauses Schedule of Cost Components Contract Data Works Information Site Information

Core clauses: The terms and conditions common to every procurement option

Main Option Clauses: 6 procurement options A - F starting with the priced contract with activity schedule option and finishing with the management contract option

Secondary Option Clauses: Items for which there is choice: e.g. performance bonds, parent company guarantees, sectional completion, retention, delay damages, dispute resolution processes, other additional conditions. Schedule of Cost Components: e.g wages, bonuses, travelling, plant hire costs, plant depreciation costs etc; used to evaluate the actual cost of changes to the Work

Contract Data: States contractully essential items such as which main and secondary options have been chosen, the names of the parties, starting date, completion date, etc.
(important list of essential contractual matters)

Works Information: Drawings, specifications, etc. Site Information: Site investigation information

A fundamental objective of the ECC is that it should minimise the incidence of disputes. Consequently words like fair, reasonable and opinion have been used as little as possible. Every procedure has been designed so that its implementation should contribute rather than detract from the effectiveness of management of the work.

A principle of the ECC is that the Project Manager, acting on behalf of the Employer and in communication with him, should be presented with options for dealing with the problem from which he can choose, directed by the interests of the Employer. The Contractor should be unaffected by the choice made.

ECC pioneered a variety of concepts many of which have now been adopted by other standard forms e.g. adjudication (now statutory) early warning quotations for changed work removal of nomination of sub-contractors The production and review of construction programmes is a core requirement of ECC on the basis that clear programming is essential to effective project management.