Notable changes to NZS3910:2023 for civil and commercial construction contracts

Those involved with civil and commercial construction contracts will see the updated NZS3910:2023 General Conditions of Contract appearing in tenders coming to market.

The new version is an evolution rather than a revolution of the previous 2013 version, so experience should find it easy to get to grips with.

These are some of the notable changes:

• The introduction of a Target Price option with “pain’ and “gain” sharing in proportions set and agreed as a new Schedule 1 variable. We anticipate this being an attractive pricing mechanism for Principals. The devil will be in the detail when it comes to defining the unders and overs.
• The role of the Engineer has been replaced by a Contract Administrator and an Independent Certifier.
• • Contract Administrator – Issues Site Instructions to the Contractor.
  • Independent Certifier – Receives and values Payment Claims, decides Contractor’s entitlement to Variations and EoT claims, and makes Formal Decisions.
  • BUT any practical difference may be undermined by the fact that both roles may be the same person.

• There is provision to specify what (if any) aspects of design the contractor will be responsible for, with a prompt in Schedule 1 to match the new general condition.
• Fluctuations now apply by default unless specifically excluded in Schedule 1.
• The three-month time limit for giving notice of arbitration after the Engineer’s decision is gone.

We will be providing “Principals’ Guide Notes” and “Contractors’ Guide Notes” to NZS3910:2023. Though these will not be exhaustive, they will serve as a starting guide for principals putting together their first 3910:2023 based RFP and contractors wondering what areas to consider for tagging.

If you want a copy of either guide, please email richardk@st.co.nz.

Written by Richard Kettlewell