Plain English Explanation
This CE arises when the PM changes a decision they have already communicated to you. If you have acted in reliance on the PM's earlier decision and they then change it, you are entitled to a CE for the additional cost and time that results from the change.
Examples include: the PM approving a method statement and then requiring a different approach; accepting a material or product and then requiring a substitution; or confirming an area for temporary works and then relocating it. The CE recognises that reliance on a PM decision has a cost, and that changing your mind has consequences.
This is distinct from the PM instructing a change to the Scope (60.1(1)) — here, the issue is the reversal of a previous decision rather than a scope change.
Key Takeaway
Confirm every PM decision in writing — even a one-line email noting 'confirming your verbal approval of X' creates the paper trail that makes this CE enforceable.
What This Means for Subcontractors
On subcontracts, this CE applies when the main contractor reverses a decision they have already communicated. It is common for main contractors to change their minds about buildability, programme logic, or temporary works without appreciating the commercial consequences. Document all decisions received, including the form of communication, and notify a CE promptly when a reversal occurs.
Common Risks & Disputes
- 1The PM arguing the earlier communication was not a formal 'decision' but merely an indication or approval in principle
- 2Not having written evidence of the original decision — verbal communications are very hard to substantiate
- 3Acting on the changed decision before notifying the CE, which may complicate the assessment of impact
- 4Difficulty quantifying the cost of undoing and redoing work, particularly where materials have already been ordered or fabricated
- 5The PM claiming the change was necessitated by your non-compliance or a Defect
Sources
Related Clauses
Client instruction to change the Scope
Changed decision that also alters the defined Scope
PM or Supervisor does not reply within the period required
Late PM response that led to the changed decision
PM changes an earlier decision on accepting a Contractor communication
Withdrawal of a PM acceptance — a closely related mechanism
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