Construction Law/Sub Clause12.3 (iii)
I would like to ask you in connection with sub-clause 12.3 (iii). At the moment i have change order with additional quantity for relocation LV poles (originally 99 poles to be 154 poles) and i intend to propose a new rate since contract rate is no longer sufficient to be applied (original rate: $500/unit, new rate: $900/unit).
The condition is comply with criteria 12.3 (i), (ii), (iv), but i need clarity particularly for criteria 12.3 (iii) (change in quantity directly changes the cost per unit quantity of this item by more than 1%).
Thank you for this question.
YOu have not set out the reasons why the rate increase will be so great and I will not speculate. In answer to your query regarding the condition set out in sub-clause 12.3(a)(iii) - that the change in quantity directly changes the Cost per unit quantity of the item by more than 1% - I note as follows.
Your original rate was $500.
1% of that original rate is, therefore, $5.
For a new rate to be appropriate under sub-clause 12.3(a), all of conditions (i)-(iv) must apply. Hence your new a reg must be more that $5 different from the old rate; that is it must be less than $495/item or more than $505/item. As you are proposing a new rate of $900 this criterion is satisfied.
I hope that this assists you.
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