What is a JCT Contract?
The JCT contracts are a suite of building contracts that are available as off-the-shelf products for use in forming formal, clear, and legally binding contracts on construction projects.
The JCT suite is one of the most commonly used contract suites in the UK construction industry, and its widespread popularity can be attributed to a combination of the JCT having designed standardised forms to suit a wide range of projects and procurement options, and the forms having been drafted to be fair for each party to the contract.
The different JCT contract forms
The JCT produce a wide range of contracts from those designed for use on simple home extensions, right through to contract forms suitable for the most complex multi-million-pound projects.
The JCT list their most commonly used contracts as the JCT Standard Building Contract, Design and Build Contract, and Minor Works Building Contract.
The Standard JCT Contract
The Standard JCT Contract is drafted to suit larger works, or works of a complex nature that involve a high degree of building services or specialist work and its drafting to include provisions allowing:
- for the contractor to design discrete parts of the works.
- works to be carried out in sections.
- for specialists to be named in the contract.
The Standard JCT Contract provides for the works to be designed or detailed on behalf of the Employer, and for the Employer to provide drawings and documentation to define the scope and quality of the works. The Standard JCT Contract is also available in several variations depending on whether the contract is to be a lump sum or is subject to remeasurement.
The Standard Form is typically seen on large complex commercial construction projects, particularly where specification and design are important factors the Employer.
The JCT Design and Build Contract
The JCT Design and Build Contract is drafted to suit projects where the Contractor is to be responsible for both completing the design of the works and the construction of the works. In such instances the Employer will provide detailed information to the Contractor, known as the Employer’s Requirements and the Contractor is paid a lump sum price to complete the detailed design and construction of the Employer’s Requirements.
This form of contract is very popular due to its single point of design responsibility, which means that if a defect is found the Employer need only pursue the Contractor rather than ascertain whether it arises from faulty workmanship or the design of one of the various consultants.
The Design and Build Contract is typically seen on a wide range of commercial projects, particularly where certainty of cost and speed of construction are important factors for the Employer.
The JCT Minor Works Contract
The JCT Minor Works Contract is drafted to suit projects where:
- the work involved is simple in character;
- the work is designed by or on behalf of the Employer;
- the Employer is to provide drawings and/or a specification and/or work schedules to define adequately the quantity and quality of the work; and
- an Architect/Contract Administrator is to administer the conditions.
There is also a version of the Minor Works Contract which contains provisions for the Contractor to design part of the works.
The Minor Works forms are typically seen on small simple commercial projects.
Which JCT contract should I choose?
A key question that is often asked is which form of JCT contract should I choose for my project. The answer as to which form is most appropriate will depend upon the nature of the project and the most suitable procurement route for that project, taking into account project deliverables as to time, cost and quality. A further factor to then consider is whether the conditions within the standard suites should be amended to suit the specific needs of your project.
Procurement, contract selection and drafting contract amendments are an important task as the resulting contract will define the parties’ roles, rights, and obligations for the project. Getting this wrong can have a significant negative impact on the project or one or more parties.
As such we would recommend that you contact us prior to selecting a form so that we can provide detailed procurement and contract advice specific to your needs.
The format of the JCT contract and its key provisions
The majority of JCT forms follow the standard format of:
- Articles of Agreement
- Contract Particulars (where the parties set out project-specific information)
- Conditions of Contract; and
- Schedules (which can be added into the contract if desired)
The Conditions are then typically divided into the following main sections:
- Definitions
- Carrying out the works
- Control of the works
- Payment
- Variations
- Injury, damage and insurance
- Assignment, third party rights and collateral warranties
- Termination
- Settlement of disputes
It is beyond the scope of this article to discuss each clause in detail. However, please do contact us if you require detailed advice on specific contract clauses.
Contract amendments
Any amendments to the contract should be checked closely as they can alter your rights and become onerous contracts. Onerous points to be aware of include bespoke or amended payment provisions, defects and retention, set-off clauses, design responsibility, extension of time, loss and expense, condition precedent, acceleration, supplementation, and contract termination. Our advice guide on onerous construction contracts explains how to deal with these provisions.
How we can help you
It is critical to take appropriate advice before entering into any form of building contract. The implications of entering into a contract that does not properly document your intent can lead to you taking on more risk and responsibility than you intended. This in turn can be catastrophic if an issue arises on the project. Many construction disputes can be mitigated by ensuring that the construction contracts are properly prepared and understood prior to commencement.
At Arbicon we offer advice in respect of procurement routes, contract drafting, clause amendments and also regularly undertake risk reviews of contracts that you may have been asked to enter.
If you would like advice on a JCT contract, or have a JCT dispute, please use our contact form or call one of our offices.