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Last edited 22 Aug 2017
NEC early warning notices - a tool of mutual benefit
Rudi Klein, NEC Users’ Group President and Chief Executive at Specialist Engineering Contractors' (SEC) Group argues that the sooner we can appreciate that early warning notices are a tool of mutual benefit to both parties – and not designed to advantage one side over the other – the better.
- "I always issue early warning notices, whatever the problem, to ensure I get a compensation event."
- "The other side issues early warning notices to establish it is my fault and I have to fix it immediately."
- "I am wary of issuing early warning notices because the other side uses them against me in the event of a dispute."
- "Everyone on the project ignores early warning notices."
 Risk management tool
They were introduced as a risk management tool because it is common sense that dealing with risk – wherever it comes from – as soon as it becomes apparent is far cheaper than trying to manage the risk and/or its consequences much later on.
An early warning notice must be issued as soon as a party becomes aware of 'any matter' which could affect the total of the prices, could delay completion or a key date, or impair the performance of the works in use.
 Mutual benefit to parties
Early warning notices should not be issued for the purpose of allocating responsibility or liability. A party attempting to do this could be failing to act in the NEC clause 10, 'spirit of mutual trust and co-operation'. When dealing with matters which are the subject of an early warning notice, the emphasis should be on agreeing the steps required to address the matter rather than allocating blame.
Certainly ignoring early warning notices is a dangerous game. Apart from a possible breach of clause 10, any compensation event that may follow is likely to be costlier to the client than if the matter had been dealt with at the outset.
But remember there is no direct link between early warning notices and compensation events. An early warning notice might not lead to a compensation event and a compensation event might occur without an early warning notice.
It was originally published here on 17 July 2017 by ICE.
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