What is an option C contract?

What is an option C contract?

Option C is a target cost contract with an activity schedule where the out-turn financial risks are shared between the client and the contractor in an agreed proportion. This document contains all the core and secondary option clauses, the schedules of cost components, and contract data relevant to an option C contact.

What is NEC C?

NEC was first published in 1993 as the New Engineering Contract. It is a suite of construction contracts intended to promote partnering and collaboration between the contractor and client.

What is the schedule of cost components?

The Schedule of Cost Components contains rules for the reimbursement of people employed and not employed within the Working Areas.

What are the characteristics of NEC contracts?

Characteristics. 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.

What is NEC3 option B?

Option B is a priced contract with a bill of quantities where the risk of carrying out the work at the agreed prices being is borne by the contractor. This document contains all the core and secondary option clauses, the shorter schedule of cost components, and contract data, relevant to an option B contract.

What is defined cost under NEC3 option A?

Broadly speaking, Defined Costs are the actual costs incurred by the Contractor on the Works minus retention and any costs which would fall within the overheads covered in the Fee. From those are deducted “Disallowed Costs”.

What is NEC option D?

Option D provides for a target cost with a bill of quantities: A target cost introduces a mechanism that enables the contractor, and/or the consultant team, to share in the benefits of cost savings, but also to bear some of the cost when there are cost overruns. This is typically shared in a pre-agreed proportion.

How many NEC options are there?

7 different options
Under NEC there are 7 different options for procuring work. This article will provide descriptions of how each option works and explore the pros and cons to establish which option works best for you.

What is NEC option F?

Option F is a cost reimbursable management contract where the financial risk is taken largely by the client. This document contains all the core clauses and secondary option clauses the schedules of cost components, and contract data, relevant to an option F contract.

What is the difference between NEC3 option A and C?

Under Option A, the crunch point is at the beginning and achieving an appropriate Activity Schedule breakdown whereas, under Option C, it is a month on month direct demonstration of cost to enable interim payment.

What is NEC option B?

Option B is a priced contract with a bill of quantities where the risk of carrying out the work at the agreed prices being is borne by the contractor. This document contains all the core and secondary option clauses, the shorter schedule of cost components, and contract data, relevant to an option B contract. …

What is NEC3 option E?

Option E is a cost reimbursable type contract where the financial risk is taken largely by the client. This document contains all the core clauses and secondary option clauses the schedules of cost components, and contract data, relevant to an option E contract. Construction Clients’ Board endorsement of NEC3.