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framework contract

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June 2017
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Framework Contract

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This contract should be used for the appointment of one or more suppliers over a set term to
carry out work or provide a service or goods on an ‘as instructed’ basis using NEC4 contracts

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An NEC document
June 2017
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The Government Construction Board, Cabinet Office UK

The Government Construction Board (formerly Construction Clients’ Board) recommends
that public sector organisations use the NEC contracts and in particular the NEC4 contracts
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where appropriate, when procuring construction. Standardising use of this comprehensive

suite of contracts should help to deliver efficiencies across the public sector and promote
behaviours in line with the principles of the Government Construction Strategy.

The Development Bureau, HKSAR Government

The Development Bureau recommends the progressive transition from NEC3 to NEC4 in public
works projects in Hong Kong. With suitable amendments to adapt to the Hong Kong local
environment, NEC4 is expected to further enhance collaborative partnering, unlock innovations
and achieve better cost management and value for money in public works projects.

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NEC is a division of Thomas Telford Ltd, which is a wholly owned subsidiary of the Institution

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of Civil Engineers (ICE), the owner and developer of the NEC.

The NEC is a suite of standard contracts, each of which has these characteristics:

• Its use stimulates good management of the relationship between the two parties to the

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contract and, hence, of the work included in the contract.

• It can be used in a wide variety of commercial situations, for a wide variety of types of

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work and in any location.

• It is a clear and simple document – using language and a structure which are
straightforward and easily understood.

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NEC4 Framework Contract is one of the NEC suite and is consistent with all other NEC4
documents. Also available are User Guides and Flow Charts.

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ISBN (complete box set) 978-0-7277-6391-4
ISBN (this document) 978-0-7277-6222-1
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ISBN (Establishing a Procurement and Contract Strategy) 978-0-7277-6223-8
ISBN (Preparing and Managing a Framework Contract) 978-0-7277-6246-7
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ISBN (Selecting a Supplier) 978-0-7277-6234-4

ISBN (Framework Contract Flow Charts) 978-0-7277-6278-8 (e-only)
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First edition 2005, Reprinted with amendments 2013

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Second edition June 2017

Reprinted January 2019
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British Library Cataloguing in Publication Data for this publication is available from the
British Library.
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© Copyright nec 2017

All rights, including translation, reserved. The owner of this document may reproduce the
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Contract Data and forms for the purpose of obtaining tenders, awarding and administering
contracts. Except as permitted by the Copyright, Designs and Patents Act 1988, no part of
this publication may be otherwise reproduced, stored in a retrieval system or transmitted in
any form or by any means, electronic, mechanical, photocopying, recording or otherwise,
without the prior written permission of the NEC Director, Thomas Telford Ltd, One Great
George Street, Westminster, London SW1P 3AA.

Typeset by Manila Typesetting Company

Printed and bound in Great Britain by Bell & Bain Limited, Glasgow, UK

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 Contents

Contents

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Foreword v

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Preface vii

Acknowledgements ix

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Conditions of Contract 1

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Contract Data 3
Part one – Data provided by the Client 3
Part two – Data provided by the Supplier 5

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Index 6

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 Foreword

Foreword

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Continuous improvement in project delivery is required to build confidence in the UK
construction sector so that we can attract more investment. The Infrastructure and Projects

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Authority (IPA) is the government’s centre of expertise for infrastructure and major projects.
We sit at the heart of government, reporting to the Cabinet Office and HM Treasury.

The application of the right contract is central to the success of the overall project delivery
system. The NEC suite of contracts has been in existence for over the 20 years and has linked

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the projects, people and processes together to create the correct environment for successful
delivery.

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This new and updated NEC4 contract embraces the digital changes that are happening in the
construction industry, especially around BIM, which I believe will be central to creating a step
change in performance. Whilst looking forward it also builds on the fundamentals required

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for an effective contract.

The use of NEC4 on public sector projects will help to deliver the Government Construction

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Strategy as we seek to improve central government’s capability as a construction client to
deliver further savings in the order of £1.7bn across the Government estate. The IPA looks
forward to collaborating with industry to make the delivery of projects more efficient and
effective.
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Tony Meggs, Chief Executive, Infrastructure and Projects Authority
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Reporting to Cabinet Office

and HM Treasury
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 Preface

Preface

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NEC was first published as a new and innovative way of managing construction contracts in
1993 – some 24 years ago. It was designed to facilitate and encourage good management of

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risks and uncertainties, using clear and simple language.

The NEC approach to managing contracts was endorsed in “Constructing the team – The
Latham Report”, which was a government/industry review of procurement and contractual
arrangements in the UK construction industry. This led to a second edition in 1995

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incorporating the further recommendations of that review. This contract was used increasingly
in the UK and overseas, and a major revision was made with the third edition in 2005.

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NEC has played a part in helping the industry do things differently and better. It has done
so by introducing effective project management procedures into the contract itself. These
require pro-active management of risk and change, and the day-to-day use of an up-to-date

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programme. The range of pricing options has given Clients flexibility in the allocation of risk
and the ability to share risk and manage it, collaboratively.

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The NEC suite has evolved over three decades, embedding consultation responses and user
feedback, and reflecting industry development, including new procurement approaches and
management techniques such as alliances, management of information (BIM) and supply
chain engagement. This feedback and the new procurement approaches formed the driver
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for the development of the next generation contracts and the launch of NEC4.

There were three key objectives in drafting NEC4:

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• provide greater stimulus to good management

• support new approaches to procurement which improve contract management and

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• inspire increased use of NEC in new markets and sectors.

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It was to be evolution, not revolution.

Some features of NEC4 include:

• a new design build and operate contract to allow flexibility between construction and
operational requirements in timing and extent
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• a new multi-party alliance contract based upon an integrated risk and reward model

• new forms of subcontract to improve integration of the supply chain.

Further enhancements include:

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• finalising cost elements during the contract

• incorporating a party-led dispute avoidance process into the adjudication process

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• increasing standardisation between contracts and

• providing enhanced guidance to give greater practical advice to users.

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NEC has always been known for its innovative approach to contract management, and this
revision continues that approach. No other contract suite has had such a transformative effect
on the built environment industry as NEC. It has put the collaborative sharing of risk and
reward at the heart of modern procurement. It is also unique in providing a complete, back-to-
back procurement solution for all works, services and supplies in any sector and any country.

NEC4 continues to set the benchmark for best practice procurement worldwide.

Peter Higgins BSc (Hons), CEng, FICE

Chair of NEC4 Contract Board

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 Acknowledgements

Acknowledgements

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The original NEC was designed and drafted by Dr Martin Barnes then of Coopers and
Lybrand with the assistance of Professor J. G. Perry then of the University of Birmingham,

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T. W. Weddell then of Travers Morgan Management, T. H. Nicholson, Consultant to the
Institution of Civil Engineers, A. Norman then of the University of Manchester Institute of
Science and Technology and P. A. Baird, then Corporate Contracts Consultant, Eskom, South
Africa.

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This fourth edition of the NEC suite was produced by the Institution of Civil Engineers
through its NEC4 Contract Board.

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The NEC4 Contract Board is:

P. Higgins, BSc (Hons), CEng, FICE (Chair)

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P. T. Cousins, BEng (Tech), DipArb, CEng, MICE, FCIArb
I. Heaphy, BSc (Hons), FRICS, FCIArb, MCInstCES, MACostE
J. N. Hughes-D’Aeth, BA (Hons), MA (Cantab)

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S. Rowsell, BSc, CEng, FCIHT, FICE, MCIPS

The NEC4 drafting team consisted of:

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M. Garratt, BSc (Hons), MRICS, FCIArb
R. Gerrard, BSc (Hons), FRICS, FCIArb, FCInstCES
R. Hayes, BSc (Hons), MEng, CEng, MICE, MAPM
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S. Kings, BSc (Hons), MRICS, MCIPS, PhD

T. Knee-Robinson, BEng (Hons), CEng, MICE, MAPM, MCIHT
J. J. Lofty, MRICS
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R. Patterson, BA, MBA, CEng, MICE

B. Trebes, BSc (Hons), MSc, FRICS, FInstCES, FAPM
B. Walker, BSc (Hons), GMICE, ACIArb
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Proofreading by:

P. Waterhouse, BEng (Hons), MBA, CEng, FICE, FCIArb, FCInstCES, FCMI

The Institution of Civil Engineers acknowledges the help in preparing the fourth edition
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given by the NEC4 Contract Board and NEC4 drafting team and the support of the following
organisations in releasing their staff:

Anthony Collins Solicitors LLP

Berwin Leighton Paisner LLP
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CEMAR
Costain plc
Mott MacDonald Ltd
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 Conditions of Contract

Conditions of Contract

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Actions 10

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10.1 The Parties and the Client’s Representative shall act as stated in this contract.
10.2 The Parties and the Client’s Representative act in a spirit of mutual trust and co-operation.

Identified and 11
defined terms 11.1 In these conditions of contract, terms identified in the Contract Data are in italics and defined

CONDITIONS OF CONTRACT
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terms have capital initials.
11.2 (1) A Corrupt Act is

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• the offering, promising, giving, accepting or soliciting of an advantage as an inducement
for an action which is illegal, unethical or a breach of trust or

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• abusing any entrusted power for private gain

in connection with this framework contract or any other contract with the Client. This

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includes any commission paid as an inducement which was not declared to the Client before
the date this contract came into existence.

(2) Framework Information is information which specifies how the Parties work together and
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is in the document which the Contract Data states it is in.

(3) The Parties are the Client and the Supplier.

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(4) A Time Charge Order is a contract to provide advice on a proposed Work Order on a time
charge basis.
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(5) A Work Order is a contract to carry out work within the framework scope.
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Communications 13
13.1 Each communication which the contract requires is communicated in a form which can be
read, copied and recorded.
13.2 A communication has effect when it is received at the last address notified by the recipient
for receiving communications or, if none is notified, at the address of the recipient stated in
the Contract Data.
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The Client’s 14
Representative 14.1 The Client may replace the Client’s Representative after notifying the Supplier of the name of
the replacement.
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Corrupt Acts 18
CONTRACT DATA

18.1 The Supplier does not do a Corrupt Act.

The Parties’ 20
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obligations 20.1 The Supplier obeys an instruction which is in accordance with the contract and is given by
the Client’s Representative.
20.2 The Supplier attends meetings with the Client’s Representative and others as stated in the
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Framework Information.
20.3 The Supplier does not do any work until it has received a Work Order or Time Charge Order
for that work.

Supplier selection 21
21.1 When the Client requires work to be carried out within the framework scope, the Client’s
Representative uses the selection procedure to decide if the Supplier will be considered for
the work.

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 Conditions of Contract

Time Charge Order 22

22.1 If the Supplier is selected for a Time Charge Order, the Client’s Representative issues a Time
Charge Order to the Supplier. The Client’s Representative consults with the Supplier about
the contents of a Time Charge Order before it is issued.

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Quotation 23
23.1 If the Supplier is to be considered for a proposed Work Order, the Client’s Representative

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provides the additional Contract Data, Scope, Site Information and pricing document as
applicable for the work and instructs the Supplier to provide a quotation.
23.2 The Supplier provides a quotation in accordance with the quotation procedure and submits
details of its assessment with the quotation. The Supplier’s assessment is made using the
CONDITIONS OF CONTRACT

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quotation information.
23.3 The Client’s Representative assesses the Supplier’s quotation in accordance with the
quotation procedure.

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23.4 The Client’s Representative replies to the submission within the period stated in the Contract
Data. The reply is

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• the issue of a Work Order accepting the quotation,

• an instruction to submit a revised quotation or

23.5
•
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a notification that the proposed Work Order will not be issued to the Supplier.
If a revised quotation is instructed, the Client’s Representative advises the Supplier of the
reasons for not accepting the quotation. The Supplier submits a revised quotation within the
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period stated in the instruction.

Completion 30
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30.1 After the end date,

• the Client’s Representative does not issue a Time Charge Order or Work Order and
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• the Supplier completes work under Time Charge Orders and Work Orders issued before
the end date.
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Termination 90
90.1 Either Party may terminate their obligations under the contract at any time by notifying the
other Party.
90.2 After a Party has notified termination,
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• the Client’s Representative does not issue a Time Charge Order or a Work Order and

• the Supplier completes work under Time Charge Orders and Work Orders issued before
the notification.
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CONTRACT DATA

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 Contract Data

Contract Data

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PART ONE – DATA PROVIDED BY THE CLIENT

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The Data which will apply to all work under the Framework Contract is
The conditions of contract are the clauses of the NEC4 Framework Contract June 2017 and

CONDITIONS OF CONTRACT
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any additional conditions of contract.

The Client is

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  Name

   Address for communications

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   Address for electronic communications

The Client’s Representative is

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  Name
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   Address for communications

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   Address for electronic communications

The Framework Information is in

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The framework scope is in

The selection procedure is in

The quotation procedure is in

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The end date is

CONTRACT DATA

The period for reply to a Supplier’s

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quotation is

If additional conditions of The additional conditions of contract are

contract are required
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 Contract Data

The Data which will apply to all Time Charge Orders is

(The NEC4 Professional Service Short Contract would normally be used for Time Charge
Orders. Include the relevant Contract Data, Price List and Scope entries which apply to all
Time Charge Orders.)

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The Data which will apply to all Work Orders is
(Include the relevant Contract Data part one entries for the NEC4 contracts that may be used
for a Work Order. If NEC4 short contracts are to be used also include relevant entries for the
Contract Data, Price List and Scope)
CONDITIONS OF CONTRACT

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CONTRACT DATA

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 Contract Data

PART TWO – DATA PROVIDED BY THE SUPPLIER

The Data which will apply to all work under the Framework Contract is

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The Supplier is

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  Name

   Address for communications

CONDITIONS OF CONTRACT
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   Address for electronic communications

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The quotation information is in

The Data which will apply to all Time Charge Orders is

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(The NEC4 Professional Service Short Contract is normally used for Time Charge Orders.
Include the relevant entries for the Consultant’s Offer.)
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The Data which will apply to all Work Orders is

(Include the relevant Contract Data part two entries for the NEC4 contracts that may be used
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for a Work Order. If an NEC4 short contract is to be used include the relevant entries for the
Contractor’s, Consultant’s, or Supplier’s Offer)
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CONTRACT DATA
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 Index

Index

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Index by clause numbers. (Main heads indicated by bold numbers).

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Terms in italics are identified in the Contract Data, and defined terms have capital initial letters.

abuse of power 11.2(2) notification

acceptance, quotations 23.4, 23.5 replacement of Client’s Representative 14.1
termination 90.1–2
actions 10

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illegal actions 11.2(2)
address for communications 13.2 Parties/Party
actions 10.1–2

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defined terms 11.2(1)
breach of trust 11.2(2) Framework Information 11.2(3)
obligations of 20, 90.1
termination 90.1–2

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Client pricing document 23.1
defined terms 11.2(1)
private gain 11.2(2)
replacement of Client’s Representative 14.1

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Client’s Representative 14
actions 10.1–2 quotation information 23.2
instruction(s) 20.1, 23.1 quotation procedure 23.2, 23.3
quotation procedure 23.3 quotations 23
replacement of 14.1
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selection procedure 21.1
Supplier’s quotation 23.3–5 recorded communications 13.1
Time Charge Order 22.1, 30.1, 90.2 replacement of Client’s Representative 14.1
Work Order 30.1, 90.2
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revised quotations 23.5

co-operation 10.2
communications 13
Scope 23.1
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Completion 30, 90.2

selection procedure 21.1
Contract Data 11.2(3), 13.2, 23.1, 23.4
Site Information 23.1
Corrupt Act 15
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definition 11.2(2) Supplier

Completion 30.1, 90.2
Corrupt Act 15.1
defined terms 11 defined terms 11.2(1)
instruction(s) 20.1, 23.1
meetings 20.2
end date, Completion 30.1 obligations of 20.1–3
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quotations 23.1–5
replacement of Client’s Representative 14.1
Framework Information selection of 21, 22.1
defined terms 11.2(3) Time Charge Order 20.3, 22.1, 30.1, 90.2
meetings 20.2 Work Order 20.3, 23.4, 30.1, 90.2
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framework scope 21.1

termination 90
identified terms 11 time, revised quotations 23.5
Time Charge Order 20.3, 22, 30.1, 90.2
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illegal actions 11.2(2)

defined terms 11.2(4)
inducement 11.2(2)
trust and co-operation 10.2
instruction(s) to Supplier 20.1, 23.1

Work Order 11.2(4), 20.3, 23.1, 23.4, 30.1, 90.2

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meetings 20.2 defined terms 11.2(5)

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