£250,000 of additional value recovered following discovery of existing concrete basement
Contractor | Substation Project
KEY DETAILS
CLIENT TYPE
Contractor
SECTOR
Energy and infrastructure
PROJECT SCOPE
Excavation and substation works
CONTRACT SUM
£1.4 million
FORM OF CONTRACT
NEC3 Engineering and Construction Contract Option B
COMMERCIAL ISSUE
Unforeseen existing structure, redesigned methodology and programme impact
ADDITIONAL VALUE RECOVERED
£250,000
PRIMARY SERVICE AREAS
Margin Protection & Revenue Recovery; Contractual Risk & Entitlement Strategy; Commercial Troubleshooting & Intervention
Introduction
A contractor carrying out excavation works for a proposed substation uncovered an unforeseen reinforced concrete basement beneath the site.
The discovery required a major change to the planned construction methodology and created significant additional cost and programme impact.
Roxburgh Murray reviewed the contractual position, prepared a fully substantiated Compensation Event and supported the claim with site records, programme evidence and detailed cost information.
By clearly demonstrating the contractor’s entitlement and strengthening the commercial position, Roxburgh Murray secured £250,000 of additional value.
The situation
The contractor was carrying out excavation works for a proposed substation.
During construction, the team uncovered an existing reinforced concrete basement that had not been anticipated when the works were priced and planned.
The structure materially affected the original excavation strategy.
The contractor could no longer continue using the planned methodology and had to reassess how the works would be delivered safely and efficiently.
The discovery resulted in additional demolition and removal work, revised excavation requirements, changes to the planned methodology, additional labour and plant, programme delay, increased supervision and management input, and wider disruption to the project sequence.
Roxburgh Murray was brought in to establish the contractor’s entitlement and prepare a robust commercial recovery.
The commercial risk
Without a properly prepared Compensation Event, the contractor risked absorbing the cost and programme impact of the unforeseen structure.
The exposure included:
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Additional labour and plant costs
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Increased excavation and demolition requirements
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Revised temporary works or construction planning
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Delayed progress
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Extended site duration
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Additional supervision and management costs
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Reduced project value
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A weaker final account position
The key issue was not simply that an unexpected basement had been found.
The contractor had to demonstrate that the structure was unforeseen, that it materially changed the planned works and that the additional costs and programme effects were contractually recoverable.
Without that evidence, significant value could have been lost.
Roxburgh Murray’s review
Roxburgh Murray reviewed the NEC3 contract, the original project information, the planned methodology and the actual conditions encountered on site.
The review established that the reinforced concrete basement had not been anticipated and that its discovery created a material change to the works.
Roxburgh Murray then assessed the full effect of the event, including the change in construction methodology, additional excavation and demolition activity, labour and plant requirements, programme impact, extended site involvement, and associated management and supervision costs.
This provided the basis for a fully substantiated Compensation Event.
The Roxburgh Murray approach
Roxburgh Murray prepared and supported the contractor’s commercial recovery from initial review through to agreement.
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Reviewing the NEC3 contract
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Assessing the original tender and site information
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Establishing the unforeseen nature of the basement
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Identifying the relevant Compensation Event
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Preparing the required contractual submission
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Reviewing site records
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Analysing programme evidence
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Valuing labour, plant, materials and management costs
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Demonstrating the impact of the revised methodology
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Strengthening the contractor’s negotiating position
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Supporting the contractor through to agreement
The strength of the claim came from linking the physical discovery to the contract, programme and detailed cost evidence.
This ensured that the contractor’s recovery reflected the full commercial effect of the event.
The outcome
The Compensation Event was successfully agreed.
The contractor recovered £250,000 of additional value, ensuring that the unforeseen structure did not erode the commercial outcome of the project.
What this shows
This case demonstrates why unexpected site discoveries need an immediate and structured commercial response.
Finding an existing structure does not automatically lead to recovery. The contractor must establish entitlement, issue the correct contractual notice, evidence the change and substantiate the full cost and programme impact.
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Establish the unforeseen nature of the structure
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Identify the correct Compensation Event
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Protect contractual entitlement
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Demonstrate the change in methodology
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Evidence the resulting cost and programme impact
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Recover substantial additional value
The director-level lesson is clear:
When unforeseen site conditions change the planned methodology, the full commercial impact must be identified, evidenced and valued before it becomes an unrecoverable project cost.
Why it matters to construction leaders
Unexpected existing structures can create immediate cost and programme pressure.
The commercial impact can extend far beyond the direct work required to remove or work around the obstruction.
For directors and commercial leaders, this case highlights the importance of asking:
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Was the structure reasonably foreseeable?
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What project information was available at tender stage?
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How has the planned methodology changed?
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What additional labour and plant are required?
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What is the effect on the programme?
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Have all direct and indirect costs been captured?
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Has the correct Compensation Event been submitted?
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Is the contractor recovering the full value of the change?
Roxburgh Murray helps clients answer those questions before entitlement is weakened or value is missed.
Related services
Roxburgh Murray helps clients identify, substantiate and recover additional value arising from unforeseen conditions, project change and additional work.
When an unexpected site condition creates immediate commercial pressure, Roxburgh Murray provides focused support to assess the issue and develop a practical recovery strategy.
Roxburgh Murray reviews NEC contracts and project information to identify entitlement routes, risk allocation and the notices required to protect the contractor’s position.
Roxburgh Murray supports commercial negotiations with detailed evidence, clear contractual reasoning and robust valuations.
Has an unexpected site condition changed your project methodology or cost?
If an unforeseen structure, buried obstruction or unexpected site condition is affecting delivery, early contractual review is essential. Roxburgh Murray can assess entitlement, prepare the required Compensation Event and help recover the additional value created by the change.