JCT Chair, Richard Saxon CBE, has provided an update on the forthcoming JCT 2016 Edition of contracts, summarising the main new features, in a presentation to delegates at the Olswang Annual Construction Conference on Thursday 4th February.
Richard Saxon’s presentation covered a range of topics, including a history of JCT, the philosophy behind the organisation’s consensus approach, and JCT’s uniqueness as an industry-wide collaborative body:
“It could be said that JCT is one of the only fully industry-wide collaborative forums. As well as helping us to achieve our primary objective of producing our suite of contracts, our collaborative approach has a wider impact in terms of acting as a sounding board for the industry, and enables us to provide products and services for the industry that go beyond standard contract documents.
“JCT was the first standard form construction contract authoring body to produce specific provisions in respect of collaboration, sustainability, the public sector and BIM. The 2016 Edition continues that evolutionary process.”
Richard then went on to provide an update of the main changes featured in the new 2016 Edition, which is due to be published later this year, starting with the JCT Minor Works family of contracts. A summary of the main points follows:
- Incorporating and updating provisions from the JCT Public Sector Supplement relating to Fair Payment, transparency and BIM into JCT contracts as a whole.
- Provisions relating to the CDM Regulations 2015 (first published as amendment sheets downloadable via the JCT website) will be fully incorporated.
- The JCT 2016 Edition will reflect the Public Contracts Regulations 2015, with provisions for use by public bodies, contractors and sub-contractors on public sector projects
- There are a number of changes in respect of payment, designed to reflect Fair Payment principles and to simplify and consolidate the payment provisions:
- Establishing, for Fair Payment purposes, Interim Valuation Dates which will operate at main contract, sub-contract and sub-subcontract levels.
- Under the interim payment due date provisions, the monthly cycle of due dates applicable to payments up to practical completion now continues to apply after practical completion, up to the due date of Final Payment. This change is consistent with a with a new Loss and Expense ascertainment procedure and with Fair Payment principles.
- Revising and simplifying the payment provisions more generally, including introducing a procedure for prompt assessment of Loss and Expense claims, providing further flexibility in relation to Fluctuations Provisions, and consolidating the provisions containing the notice requirements of the Housing Grants, Construction and Regeneration Act 1996 - JCT 2016 will include provisions for the grant of Performance Bonds and Parent Company guarantees and we have extended the optional provisions for the obtaining of Collateral Warranties from sub-contractors to include, as an alternative, the granting of Third Party Rights by sub-contractors.
- Including an extension of (Works) Insurance Option C to allow alternative solutions to the problems encountered by tenants and domestic homeowners in obtaining Existing Structures cover for Contractors, and consolidation within the main text of the generic provisions that apply to Insurance Options A, B and C (evidence of insurance, insurance claims and reinstatement work).
- Further changes to improve functionality and user-friendliness across the suite, including minor updates and clarification of the intellectual property provisions, and incorporating (where appropriate) the provisions of the JCT 2012 Named Specialist Update.
More details of these modifications, and any that may apply specifically to a group of contracts, will be outlined as the publication of each family of contracts within the suite approaches.
If you would like to be kept informed about the JCT 2016 Edition and the changes made, sign-up at http://www.jctltd.co.uk/jct-network-signup.aspx
