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Discussion Starter · #1 ·
In EPC contracts with lump sum payments, if any work in the bill of quantities is not to be executed as per the Employer's instructions, can the contractor claim the amount against it taking the plea that lumpsum has been quoted for the whole job and such payments for the works not required. It has been noticed that the work is not required at a later stage.and there was an error in the preperation of BOQ.
Please advice giving references if any.
 

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Lump Sum Payments - Reply

Generally speaking, no...you cannot bill against a LS line item when the scope for that work was eliminated or reduced. You should have been requested to provide a deductive change value and your overall contract reduced by an agreed amount. HOWEVER, in certain Prime Contracts, you may be able to negotiate an equitable adjustment if the amount of the item was reduced more than 25% of its original value based on the theory that you lost profit and the ability to keep crews working because of the design error. You need to research the Change Order and Claim sections of the Prime Contract to determine what you can do; bear in mind that you'll have time limits on notifying the Owner or General Contractor, depending on your position in the contract, and should do this research as soon as possible to protect your reporting timeframes.
 
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