Decision

1)To proceed with a deed of variation (DoV) for Phase 1 to the NEC 4 Engineering and Construction contract (the Contract) enabling the Council and construction contractor to offset monetary sums owed between the parties, and in the event a monetary sum is due, a net sum is paid by either party.
2)To proceed with a settlement agreement enabling construction activity associated with the Phase 1 defects and rectifications.
3)To proceed with a DoV to the Engineering advisor contract to include the Biowaste project excluding design liability for the Biowaste project.

There are confidential appendices to this report which are exempt from publication under paragraph 3 of Schedule 12A of the Local Government Act 1972.

Reasons for the decision

Recommendation 1 relates to the Council being contractually required to pay for additional works. The Construction Contractor is required to pay the Council a sum of money for not achieving contractual timescales for completing phase 1 and requires revised phase 2 access dates. To administer the Contract, some legal formalities need to be completed through a DoV to offset the values.
Recommendation 2 relates to a financial agreement by the Council enabling the defects from phase 1 works to be corrected by the Construction Contractor and commence phase 2 works.
Recommendation 3 relates to there being a spend value that will take the spend value listed in the waiver beyond the Contracts Regulations 2015 (PCR). Additionally, the change of engineering advisor represents a saving to the Council over a 6 month period. The Council has appropriate replacement engineering advisor contracts which are compliant with PCR to be used for the Biowaste project.

Alternative options considered

For Recommendation 1 the alternative options were:
Option A: Do nothing
Option B: Legal route to seek financial compensation under the Contract
For Recommendation 2 the alternative options were:
Option A: Do nothing.
Option B: Use an alternative contractor to resolve the defects
For Recommendation 3 the alternative options were:
Do nothing – remain with existing engineering advisor
Option B: Use an alternative contractor to resolve the defects