Out-Law News | 30 Jun 2016 | 12:15 pm | 2 min. read
The organisation intends to update each 'family' of contracts that it publishes in stages throughout the year, alongside information setting out the main areas of difference between the new versions of the contracts and the previous 2011 edition.
Construction law expert Michael Allan of Pinsent Masons, the law firm behind Out-Law.com, said that JCT was keen to emphasise its "core strengths" with its updated contracts.
"JCT is proud of their heritage as the longest-running and largest contract producing body in the UK," he said. "It must also be aware that their once unchallenged position as contract kingpin is under increasing threat from the NEC suite of contracts – now itself so well-established that you can no longer really call it the young upstart."
"If NEC can be said to have stolen a march around issues of proactivity and project management, JCT have been making it clear that for them it is all about being a consensus-based body producing contracts that 'reflect the benefits accrued through precedent'. In fairness, the precedent point is well made: since the advent of adjudication as the primary source of dispute resolution in the construction industry, one of the difficulties we do have with NEC is the lack of established precedent to aid the guidance on the interpretation of the contract," he said.
The new versions of the minor works contracts incorporate various public sector provisions, such as those required by the 2015 Public Contracts Regulations and the 2000 Freedom of Information Act. Further amendments have been introduced to reflect the 2015 Construction (Design and Management) Regulations, which made significant changes to site safety requirements. The contracts now also contain more flexible terms for use when dealing with insurance of the works and existing structures, and simpler payment provisions.
JCT has also introduced a general clause to the contracts providing that consents and approvals must not be unreasonably withheld or delayed, and included 'interim valuation dates' from which to hang the payment dates and payment notices required under the amended 1996 Housing Grants, Construction and Regeneration Act. However, as the contracts only cover minor works they do not reflect more substantial changes due once the main contracts are updated; such as provision for payment securities, incorporation of building information modelling (BIM) and provisions providing for prompt assessment of loss and expense claims, Allan said.
The update is designed to reflect relevant changes to law and practice, but contractors and employers will not be required to switch from using the 2011 versions of the contracts if they do not choose to do so. Construction law expert Michael Allan said that the more modern language used in the 2016 contract was enough of an incentive for firms to make the switch; but said that JCT could have taken the opportunity to introduce even bolder amendments, such as changes to risk allocation, to reflect the type of amendments employers generally make to the forms.
"The 'minor works' contracts are the shortest of the main JCT contract forms, but we now have a clear idea of what we can expect to see in the 'grown up' forms of the contracts when they emerge," he said. "JCT is taking the chance to modernise the language of the contracts and streamline the drafting. Even if you ignore the other, more substantive changes, just for that reason the amendments are going to be a good thing."
"When you look at how employers amend JCT, I believe it is difficult to resist the notion that some of the changes made are now 'standard'. Those that are standard could have been incorporated into these updates. For example, where the contractor is taking responsibility for design, why should employers still have to amend the contract every time to make the contractor responsible, even where some of the design might lie in the employer's requirements?" he said.