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Last edited 02 Nov 2021
The New Engineering Contract (NEC) was first published in 1993 by the Institution of Civil Engineers. It is a suite of construction contracts that includes the Engineering and Construction Contract (ECC) intended to promote partnering and collaboration between the contractor and client. It was developed as a reaction to other more traditional forms of construction contract which were portrayed by some as adversarial.
The second edition, NEC2 contained contractual milestones for sectional completion as well as the final completion date. However, this was seen as limiting the ability of the Employer to add time constraints without having to take possession of section of works themselves. As a result, the third edition, NEC3 published in 2005 and introduced ‘key dates’.
Key dates are covered in ECC Clause 31.2 – Programme Requirements. The key dates provision is applicable when the Employer requires specific milestones or conditions to be completed or met by a certain date.
It defines a key date as:
‘…the date on which work is to meet the Conditions stated. The 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.’
Under sectional completion, the Employer must take over the works not later than two weeks after completion, whereas key dates simply require that the contractor meets defined conditions before the key date. An example of a key date could be the requirement for a subcontractor to have completed a section of works so that an electrical contractor can begin their work.
NEC3’s Guidance Notes state that key dates are applicable on projects with two or more contractors. They may have separate contracts but will have the same employer and, in most circumstances, the same project manager. The inclusion of key dates allows for closer cooperation and more efficient progress of the work as timescales can be planned in accordance with an overall project programme.
Should a contractor fail to meet the stated condition by the relevant key date, they may be liable to pay unliquidated (i.e. actual rather than pre-determined) damages to the Employer for additional costs incurred in carrying out the work or paying additional amounts to others. Because this risk is difficult to quantify, it is particularly important that the contractor manages the programme effectively and, if necessary, uses the early warning and compensation event processes provided for by the contract to notify of a potential delay to the works.
Criticism of the key dates provision focuses on the idea that precise identification of the conditions that are less than a sectional completion but must be done in order for a contractor to achieve a key date are often ambiguous and unclear.
NB The Society of Construction Law Delay and Disruption Protocol, 2nd edition, published in February 2017 by the Society of Construction Law (UK) suggests that 'key dates' are '...used to describe a date by which an identifiable accomplishment must be started or finished. Examples include ‘power on’, ‘weather-tight’ or the start or completion of phases of construction or of phases or sections of the contract, or completion of the works.'
- Accepted programme.
- Bill of quantities.
- Compensation event.
- Construction contract.
- Contract conditions.
- Cost reimbursable contract.
- Delay damages.
- Electrical contractor.
- Latham Report.
- Line of balance (LOB).
- NEC contract change management systems.
- Topping out.
- Z clauses.
 External references
- Fenwick Elliott – Contract of the future
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