Out with the old, in with the new: The new JCT Design & Build 2024

17th April 2024

Today brings the much anticipated publication of the updated JCT Design & Build “family” of contracts – here is everything you need to know about this change at a glance, and what we might expect as more updated JCT contracts are released.

The last time the JCT published an updated suite of contracts was 8 years ago (2016). Since then, the construction industry has navigated Brexit, a global pandemic, rising inflation, new technologies and the tragedy at Grenfell tower which has paved the way to one of the most significant changes in legislation/regulation experienced by the industry in decades. It is safe to say that an update to this widely used suite of contracts is necessary, and welcome.

What are the changes?

Modernising and streamlining

The new forms of contract now use gender neutral language, a welcome change that has already been made in other standard form contracts such as NEC and FIDIC.

The JCT has also acknowledged the key role that technology has in the administration of contracts, by permitting notices to be sent electronically and updating its notes on execution to include the use of electronic signatures.

Fluctuations provisions

Fluctuations provisions, which have seen an increase in use recently given the volatility in material and labour costs, will be moved online to the JCT’s Fluctuations Hub. This Hub will also include guidance on the standard form fluctuations provisions.

Extensions of time

New Relevant Events have been added, and existing Relevant Events expanded upon, to cover epidemics causing a delay as a result of unavailability of labour and/or materials, unexploded bombs, and unanticipated contamination and asbestos. The existing Relevant Event relating to acts by UK Government has been updated, and specifically includes publication of guidance.

Employer’s Agents will note that the previous 12-week period for extension of time assessments has been reduced to 8 weeks.

Loss and expense

The list of Relevant Matters that would allow a Contractor to claim additional loss and expense, have also been expanded. Newcomers to the list include optional Relevant Matters for epidemics and the exercise of statutory powers by the UK government. The Relevant Matter relating to the discovery of antiquities has also been expanded to include other unexpected conditions such as unexploded bombs, contamination and asbestos.

Payment due date after termination

To reduce uncertainty, the new suite has added a new clause relating to the payment due date after termination.

Resolving disputes, arbitration, and adjudication

Under the 2016 suite of contracts, parties chose their preferred nominating body or appointer from a pre-populated list. The new suite still has the list (albeit amended) but also has the option to choose a body or appointer that is not listed.

Supplemental Provision 10, requiring good faith negotiations between senior executives in the event of a dispute has also become mandatory, rather than an optional clause, reflecting both the construction and legal industries’ preferences for early resolution of disputes in an attempt to avoid more costly and time consuming methods.

Legislative changes and case law

The JCT has been amended to reflect the recent overhaul of building safety regulation and legislation under the Building Safety Act 2022 (BSA). The JCT appears to have taken a conservative approach to these amendments, and has not addressed the new regime for Higher Risk Buildings within the updated contract, save for a footnote referring to the D&B Guidance Note, which in turn refers to the JCT website. Watch this space for a spotlight on the new suite’s approach to the BSA.

The new suite also reflects the Corporate Insolvency and Governance Act (CIGA) 2020 by adding two new limbs to its definition of insolvency.

The JCT has updated its contracts to reflect developments in case law, most notably the Supreme Court’s decision in Triple Point Technology Inc v PTT Public Company Ltd [2021] UKSC 29 which has led the JCT to clarify the position in respect of recovery of LDs/general damages in the event of termination.

Future proofing

In an attempt to keep the JCT contracts up to date, they now include reference to government guidance, such as the UK Government Construction Playbook. They have also moved the optional supplemental provisions relating to collaborative working, sustainable development, and environmental considerations into the main body of the contract.

Still to come

The contracts published today are the new family of the JCT Design & Build contract only, and we await publication of the rest of the suite. We do not anticipate there being many surprises within the remainder of the suite, but look forward to reviewing the promised Target Cost Contract. This form of contract is new to the JCT suite, and will be JCT’s alternative to the NEC Option C contract.

We will be delving deeper into the changes made in this new suite of contracts, so please follow us for more articles on the impact of these changes.

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