New JCT construction contract suite expected in spring 2024

Standard form contracts are sets of customisable documents covering all aspects of a construction project and are designed to reduce the amount of time companies spend on contracts and deliver reliable results. The Joint Contracts Tribunal (JCT) is made up of seven member organisations and its contracts are used in 70% of UK construction projects.

The JCT told a recent reception that the long awaited new JCT suite will be published in spring as JCT 2024. Its exact publication date will depend on when the UK government publishes secondary legislation for the Building Safety Act, which isn’t expected until October. JCT wants to address that in its new edition.

The suite will include a new Target Cost Contract, with a matching sub-contract and guide.

The new contracts will include changed termination accounting and payment provisions reflecting changes to the Construction Act, including adding a due date for the final payment after termination; it will add two new insolvency grounds to match CIGA 2020, and will reflect changes to the Building Safety Act.

Other changes include:

New relevant events:

there will be new relevant events to cover epidemics, updates to how ‘statutory powers’ are dealt with and ‘statutory undertakers’ will be redefined as ‘statutory providers’.

Assessment of extension of time:

the period for the employer to assess an interim extension of time will be reduced from 12 weeks to 8 weeks from receipt of particulars.

Wider relevant event:

the antiquities provision will be extended to deal with unexploded ordinance, contamination and asbestos. This will also be a ‘relevant matter’.

Loss and expense:

the contract particulars will allow parties to select optional additional grounds for loss and expense, including epidemics and the exercise of statutory powers by the UK government which directly affects the works.

The suite will be updated to take into account the Supreme Court’s decision in a case between Triple Point Technology and PTT Public Company. The decision restored a previous position that liquidated damages clauses apply up to termination of a contract, but not after. The 2024 JCT will make it clear that where works are not complete at termination, liquidated damages can be levied up to termination and only general damages for delay can be claimed after that.

The JCT has launched a new fluctuations hub to offer guidance on its fluctuation options and plans to move the fluctuation provisions to an online document.

Although often dealt with in bespoke amendments, the list of nominating bodies will be amended to allow a nominating body or appointer of the parties’ choice, as opposed to being restricted to those on the original shortlist. However, it is anticipated that the particulars will still include a list of ‘standard’ bodies.

Supplemental provision 10, which requires ‘direct good faith negotiations between senior executives’ will no longer be an optional provision. Although, of course, parties will have the right to refer a dispute to adjudication at any time, this provision aims at the avoidance or early resolution of disputes by requiring each party to notify the other and for named individuals to negotiate.

The JCT contracts will be modernised. They will use of gender neutral language and will allow for the use of electronic signatures will recognise the service of notices electronically.

Digital working will be championed, but the traditional hardcopy will still be printed.

The JCT also aim to future proof its forms and promises changes to reflect the objectives of the Construction Playbook, and the incorporation of previously optional supplemental provisions relating to collaborative working.

Copies of the new contract are not available to the public but pre-orders will be available to members of the JCT Network and it is expected that the new terms will be revealed at a JCT launch event.