Working for equitable contracts and fair payment terms

Previewing the upcoming Joints Contracts Tribunal (JCT) 2024 suite of contracts

Topical Issue 601

The Joints Contracts Tribunal (JCT) is set to publish a new suite of contracts, JCT 2024, which will launch with the Design and Build 2024 Contracts on 17 April 2024. It is anticipated the new 2024 form of contracts will incorporate the following changes:

New contract family 

The JCT 2024 will introduce a new contract family, the JCT Target Costs Contract. This will comprise a main contract, sub-contract, and guidance notes. 

Modernisation 

The JCT 2024 will adopt gender neutral language and provide greater flexibility for executing contracts by electronic signature and serving electronic notices. 

Extension of time (EoTs)

The employer’s response time to applications for an extension of time is to be reduced from 12 weeks to eight weeks. 

‘Statutory undertakers’ will be defined as ‘statutory providers’. 

There will be new relevant events for extensions of time which will include epidemics and updates as to how ‘statutory powers’ are dealt with.  

Relevant events dealing with antiquities will deal with unexploded ordnance (UXB), contamination and asbestos. 

Optional relevant matters will also be provided for. 

Loss and expense

There will be additional grounds for claims for loss or expense to reflect the above updates to the extensions of time. The contract particulars will allow parties to select optional additional grounds. 

Liquidated damages and termination 

JCT 2024 will make clear that liquidated damages apply only up to the date of termination and general damages will be available thereafter.  Whether liquidated damages are a ‘cap’ to a general damages claim will therefore likely be important. 

The ‘due date’ for the final payment after termination will be added to remove any existing uncertainty. This will reflect the changes to the Construction Act. 

Disputes 

The JCT 2024 aims at the avoidance or early resolution of disputes. 
The existing supplementary provision 10 requiring ‘good faith’ negotiations between senior executives will no longer be optional. There will be a requirement for a party to notify the other potential disputes and for senior executive to meet as soon as practicable to negotiate and avoid dispute. 

Fluctuation 

In response to the issue of price uncertainty in the construction industry, JCT has introduced a Fluctuations Hub which offers guidance on fluctuation options in JCT contracts. There are plans for these provisions to be moved to an online document. 

Legislative changes 

The JCT 2024 will contain updates to reflect the Building Safety Act 2022 and its secondary legislation. 

There will also be changes to reflect the new insolvency grounds in the Corporate Insolvency and Governance Act 2020. 

Future proofing 

Previously optional supplemental provisions of collaborative working, sustainable development, and environmental considerations will be incorporated into the main contract. 

This is the first major update to the JCT suite since 2016 and we are looking forward to working with clients on this new form.

Authors

Pippa Beesley

Partner

Esther Roberts

Trainee

Russell-Cooke LLP

Terms of application

  1. We/I hereby apply for Associate Membership of the Confederation of Construction Specialists.
  2. We/I understand that Associate Membership does not confer voting rights under the Confederation’s constitution.
  3. We/I understand that when the Confederation refers a member company to an Associate, any advice or help given is under the Associate’s own PI Insurance.
  4. We/I agree that this application will not be approved until the Management Committee has been granted an opportunity to comment on the application.
  5. We/I undertake to fully comply with and be bound by the Constitution and Code of Practice on admission to membership of the Confederation.
  6. We/I have understand that notice of intended resignation from membership must be provided, in writing, to the Confederation’s administrative office at least two months in advance of the membership renewal date.
  7. We/I have noted that as an Associate Member we/I will pay the annual subscription of £270 + VAT.

Terms of application

  1. We/I hereby apply for Contractor Membership of the Confederation of Construction Specialists.
  2. We/I understand that Contractor Membership confers voting rights under the Confederation’s constitution.
  3. We/I understand that when the Confederation refers a member company to an Associate, any advice or help given is under the Associate’s own PI Insurance.
  4. We/I agree that this application will not be approved until the Management Committee has been granted an opportunity to comment on the application.
  5. We/I undertake to fully comply with and be bound by the Constitution and Code of Practice on admission to membership of the Confederation.
  6. We/I have understand that notice of intended resignation from membership must be provided, in writing, to the Confederation’s administrative office at least two months in advance of the membership renewal date.
  7. We/I have noted that as a Contractor Member we/I will pay the annual subscription according to the turnover bands shown below. (Select one.)