JCT 2024: A New Era for Construction Contracts
The Joint Contracts Tribunal (JCT), the organisation responsible for developing the most widely used standard forms of contract in the UK construction industry, has announced the release of its latest suite of contracts, JCT 2024. This eagerly anticipated update significantly enhances the JCT family of contracts, addressing evolving industry needs and aligning with recent legislative changes.
What to expect from JCT 2024.
- Modernisation and Streamlining. JCT 2024 introduces a modern approach to contract language, adopting gender-neutral terminology and enhanced flexibility regarding electronic notices. This aligns with the evolving construction industry and improves clarity for all parties.
- Extensions of Time. To better address unforeseen events that may impact project timelines, JCT 2024 expands the list of relevant events, including epidemics and exercising “statutory powers.” Additionally, the Employer’s deadline for assessing interim extensions of time is shortened from 12 weeks to 8 weeks from receiving the Contractor’s Particulars, streamlining the process and ensuring timely resolution.
- Loss and Expense. JCT 2024 enhances the provisions for loss and expense claims, introducing new events and relevant matters, such as provisions dealing with unexploded ordnance, contaminated materials, and asbestos. This expansion provides greater protection for both parties in the event of unforeseen challenges.
- Liquidated Damages and Termination. JCT 2024 aligns with the Supreme Court’s decision in Triple Point Technology Inc v PTT Public Company Ltd, allowing liquidated damages (LADs) to be levied up to termination and subsequently replaced with general damages. This clarification ensures fair compensation for the Employer without disincentivising the Contractor’s efforts to complete the project.
- Payments Due after Termination. To reduce uncertainty and promote orderly project handover, JCT 2024 introduces a payment due date after termination, ensuring that the Contractor is compensated for work completed up to the termination date. This clarity helps maintain financial stability for both parties.
- Disputes. JCT 2024 emphasises early dispute resolution, requiring parties to notify senior executives of potential disputes to seek a negotiated settlement. This proactive approach fosters collaboration and reduces the likelihood of protracted disputes. Additionally, parties now have the flexibility to choose their own adjudication nominating body, further streamlining the dispute resolution process.
- Fluctuation Provisions. JCT 2024 incorporates the newly launched JCT Fluctuations Hub, a resource developed to assist the construction sector in navigating the market’s growing economic uncertainty and volatility. The Hub guides applying the available options under the JCT suite, helping parties make informed decisions about contract pricing. Additionally, the fluctuation provisions are now accessible in an online document, enhancing accessibility and ease of use.
- Legislative Changes. JCT 2024 aligns with recent legislative changes, including the Building Safety Act, the Construction Act, and the Corporate Insolvency and Governance Act 2020. This comprehensive update ensures that the contract reflects current legal requirements and provides a robust framework for project delivery.
- Future-Proofing. JCT 2024 embraces the objectives of the Construction Playbook, promoting collaborative working and sustainable development practices. It also incorporates optional supplemental provisions related to sustainable development and environmental considerations. This forward-thinking approach aligns with the industry’s commitment to environmental stewardship and responsible construction practices.
- New Form of Contract. Introducing a new contract family, the JCT Target Cost Contract (TCC), JCT 2024 offers a flexible and collaborative alternative to existing forms. This contract type aligns with the principles of the Construction Playbook and facilitates open communication and shared goals between the parties.
- Expected Publication Date. The anticipated publication date of JCT 2024 is subject to finalising all secondary legislation related to the Building Safety Act. The Government has pledged to have all secondary legislation in place by October 2023, but some key elements remain pending.
JCT 2024 represents a significant evolution of the JCT suite of contracts, incorporating modern language, streamlining procedures, and addressing current legislative requirements. With its emphasis on collaboration, sustainability, and future-proofing, JCT 2024 is well-positioned to meet the evolving needs of the construction industry.
MacConvilles is committed to providing our clients with the latest knowledge and expertise to support their success in the ever-evolving construction industry. Contact us today to learn more about JCT 2024 and how we can help you navigate the changes.
