With a number of major legal and practical changes to the construction industry recently, together with the recent challenges faced by the wider community generally, I have been looking forward to receiving the JCT 2024 contracts for some time to see how these issues were addressed. When the first of that new 2024 generation landed earlier this week in the form of the Design and Build contract, the efforts to reflect society were immediately apparent (and, say it quietly, perhaps they have looked at the NEC4 approach as well?).
The changes are essentially split into three categories: practical, legal and conceptual.
- Practical changes
These include the express acknowledgment of the common use of e-mail, the inclusion in the core clauses (rather than supplemental) of the requirement to discuss disputes at a high level (subject to adjudication) and deadline for making a decision about an extension of time for any category or relevant event has been reduced from 12 weeks to 8 weeks.
- Legal changes
These pick up both new statutory obligations and recent case law. The consequences of the Building Safety Act appear in the new JCT contract by reference to obligations on a contractor to deliver more detailed additional information in accordance with the updated building regulations and the obligations on both employer and contractor to comply with new s.2A of the building regulations dealing with duty holder roles and responsibilities and associated competency tests.
Connected to that the JCT has also recognised that the Building Safety Act covers initial provision of a dwelling and also further works in relation to a dwelling, modifying the liability position accordingly so that the reference to reasonable skill and care keeps the insurers happy by expressly excluding fitness for purpose but also nods to the Building Safety Act by qualifying that duty by reference to any absolute statutory requirements.
In terms of recent case law, one notable change is the clarification around the operation of liquidated damages, so that the JCT now expressly states that liquidated damages are claimable up until the date of termination and then general damages must be proven thereafter, which eliminates recent argument about damages in the period up to actual completion.
- Conceptual changes
Each job, and each contract, starts with the express inclusion of a duty to work together collaboratively and in a spirit of trust and with good faith. Also the previously optional supplemental clause dealing with sustainability and environmental change has been included as a core clause encouraging the contractor to make suggestions.
Also a fundamental change to the previous versions is the treatment of epidemics, asbestos, contamination and unexploded ordnance. The contractor is now entitled to additional time and loss and expense for epidemics occurring after the base date, discovery of unexploded ordinance and discovery of asbestos or other contaminated material (to the extent that such contamination was not already identified in the contract documents).
In relation to occurrence of an epidemic, the JCT have taken the opportunity to clarify the difference between an epidemic and general force majeure, so epidemic has its own category of relevant event and relevant matter and also allows either party to terminate for prolonged suspension of the project.
It is interesting to see the influence of different stakeholders, JCT users and modern life in some of the above changes, although I suspect the requirement of employers and the expectation of funders to apply bespoke amendments will continue. I look forward to receiving the other members of the JCT 2024 family, particularly a new target cost version.
If you have any questions about the JCT 2024 or any other construction issues please contact us.
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