NEC4 Early Warning Register

NEC4 replaces the NEC3 Risk Register with the Early Warning Register (EWR). This is a sound change given that in NEC3 the Risk Register was confused with project risk registers supplementary and external to the contract. Saying that, the breadth of information contained in EWR may render the conventional project risk management processes redundant, especially in projects where quantitative risk assessment is neither desirable nor detailed within the scope. 

NEC4 remains relatively concise on the content of the EWR. While industry standards elsewhere prescribe the minimum content of a risk register in deeper detail – like mitigation ownership, probability and so on – NEC4 limits itself to definition (11.2(8)) and laconic instruction from sub-clause 15.1. Saying that, by way of implication, some details can be filtered from sub-clause 15.3. The first EWR is prepared by the PM, which is now explicitly indicated. 

The proactive side of risk management under NEC is strengthened by the Early Warning Meetings (EWM), which promote early identification of risks and motivate parties to manage risks in line with the risk management cycle. (Interestingly, this also means that the contractor will not be independent in his or her decisions, as the PM will be able to exert influence in matters related to EWs.)

NEC4 is more prescriptive in terms of frequency of EWMs. The first EWM must occur within two weeks of the starting date, and then either by instruction from the PM or the contractor, or as per the Contract Data. As per clause 15.3, those who cooperate in EWMs should produce five outputs. One of these is production of proposals on how the effects of each matter in the EWR can be avoided or reduced, which implies a search for mitigations and elaborates on what was presented in NEC3.

Sadly, NEC4 is silent on the efforts that should go into this and the parties obliged to be involved in this under the contract. In my view, this arises from many other clauses: the duty to act in a spirit of mutual trust and cooperation; the contractor’s duty to act promptly, and so on. The question is whether the mitigation effort can impose any financial burden on the contractor. This is also unclear in relation to the actions that will be taken after the EWM is concluded, but which may be necessitated by the urgency of the matter. Furthermore, the extent of cooperation remains undefined – how far should it go? 

The above considerations indicate that the CA’s exposure is relatively broad when he is implementing the ‘wishes’ of his paymaster. However, when the CA puts on the hat of certifier, his liability is less pronounced. Beyond circumstances when he can be found to be vividly in breach of the contract or negligent, guilty of fraud or deceit, [58] or when he has contributed to a loss (damage or injury), the CA is somewhat free from any duty of care in relation to the employer and the contractor. Firstly, this is because it is accepted that although the CA is under the duty to act impartially, his decisions, as per Northern Regional Health Authority v Derek Crouch Construction [59] are still ‘very personal’. Plus, what was clear after Pacific Associates was decided, all conclusions the CA makes can be subjected to further ‘revision by a more independent individual’ without any consequence to the CA. The options for a second review, as per John Holland Construction v Majorca Products, [60] also reemphasise the CA’s independence. Byrne J argued that in such circumstances ‘ [t]here is in this case no room for a duty of care owed by the Architect to the Builder the relevant content of which was duty to act fairly and impartially in carrying out the functions’. [61] Secondly, from a pragmatic point of view, this is because, as per MacFarlane J in Perini where the CA was an employee (and a named individual), the employer should not exert influence on the CA’s decisions, but is still obligated to ensure that he has discharged his duties properly under the contract. Thus, it is unlikely that the employer will challenge the CA’s decisions made in the capacity of certifier, knowing that he might potentially be liable for the CA’s breaches. Lastly, Arenson v Casson Beckman [62] indicated that the courts are convinced that it would be firstly ‘contrary to the public interest’, and secondly ‘the commercial community would be deprived of a very valuable service’ if a certifier was exposed to being ‘shot at from both sides’ by a dissatisfied employer and contractor. Although, as shown above, some cracks in the ice began to appear.


Gregor Grzeszczyk

Director | Contracts and Dispute Services

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