Episode 179 - JCT 2024 Contract Updates

This week we will be talking about the updates made to the JCT Contracts. This episode content meets PC5 - Building Procurements of the Part 3 Criteria.

Resources from today's episode:

Websites:

• https://corporate.jctltd.co.uk/jct-2024-edition-available-contracts/
• https://www.architecture.com/knowledge-and-resources/knowledge-landing-page/what-do-architects-need-to-know-about-the-new-guides-to-jct-contracts?utm_campaign=Member Update 260625&utm_content=Read more&utm_term=&utm_medium=email&utm_source=Adestra

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Transcript

Episode 179:

Hello and Welcome to the Part3 with me podcast. 

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I am your host Maria Skoutari and this week we will be talking about the updates made to the JCT Contracts. Todays’ episode meets PC5 of the Part 3 Criteria.

In April last year, the Joint Contracts Tribunal released a major update to their suite of contracts, 8 years since their last major update. This update came following the implementation of the Building Safety Act in order to embed essential information into the building contracts, such as Part 2A of the Building Regulations and CDM Principal Designer and Principal Contractor referencing the new rules and obligations while avoiding setting out detailed regulations and Gateway procedures. 

Both the 2024 and 2016 forms will be available for use until the 31st of March 2025. After this, only the 2024 contracts will be available and usable for new projects.

So what are the key changes to the contracts since the 2016 editions:

Starting with the updated JCT Standard Building Contract 2024 -

The SBC remains the industry benchmark against which other standard and bespoke forms are evaluated against. A comprehensive understanding of this contract is essential for professionals to effectively interpret and assess any form of construction agreement they may encounter.

The key updates from the 2016 edition include:

• Provisions on collaborative working, sustainability, environmental responsibilities, and mechanisms for dispute notification and negotiation are now embedded in the main body of the contract. These align with principles set out in the government’s Construction Playbook.
• In relation to building safety, the JCT treats the Building Safety Act (BSA) and related legislation as falling under the umbrella of 'Statutory Requirements'. Contractors are therefore expected to comply accordingly, though the contract does not detail every Building Safety Act provision. Instead, key dutyholder roles are referenced, with Contract Particulars now requiring distinct entries for the Principal Designer and Principal Contractor under both Part 2A of the Building Regulations 2010 and the CDM Regulations 2015.
• Clause 2.9.1.1 now mandates that the contract administrator provide the necessary building information in accordance with Regulation 11A(4) of the Building Regulations if it has not already been supplied which requires the client to provide building information as soon as practicable to every designer and contractor on the project. Clause 3.23 has also been amended to require both parties to comply with the CDM Regulations and Part 2A.
• While the contract doesn’t refer to the Building Safety Act’s gateway regime or golden thread of information—given they do not apply to all projects—it does reference the dutyholder roles of Principal Designer and Principal Contractor under CDM and Part 2A. Further guidance is available in JCT’s The Building Safety Act 2022 publication on how these issues could be addressed where the project is a higher-risk building.
• The contract now also uses gender-neutral language throughout for the first time. It also permits electronic signatures and notices to be sent electronically.
• Timeframes for employer decisions on extension of time claims have been made more stringent.
• New ‘Relevant Events’ have been included to cover epidemics and the issuance of new legislation or guidance. These may also be identified as ‘Relevant Matters’, providing flexibility for risk allocation between parties.

Now moving to the JCT Intermediate Building Contract 2024:

This contract is suited to projects involving all recognised trades and skills where a moderate level of complexity and detail is required. The 2024 edition is available in two formats—IC24 and ICD24—with the latter including contractor’s design responsibilities.

The key updates from the 2016 edition include:

• Similar to the Standard form, clauses on collaborative working, sustainability, environmental concerns, and dispute handling are now integrated into the contract body, in alignment with the Construction Playbook.
• The contract also highlights the dutyholder roles of Principal Designer and Principal Contractor under both the CDM Regulations 2015 and Part 2A of the Building Regulations 2010.
• It also introduces a new payment mechanism for sums due on or after termination.
• The definition of insolvency has also been updated to reflect the Corporate Insolvency and Governance Act 2020.
• Payment procedures have been adjusted to now comply with the Housing Grants, Construction and Regeneration Act 1996—areas not covered previously in the IC16 version.

Next up, JCT Minor Works Building Contract 2024:

Designed for straightforward construction projects of a modest scale, the Minor Works contract comes in two variants—one allowing for contractor design input, and one without.

The key updates from the 2016 edition include:

• The contract now embeds clauses relating to collaborative working, sustainability, environmental duties, and dispute processes, included in the main body of the contract echoing the government’s Construction Playbook guidance.
• A new article has been included that identifies the Principal Designer and Principal Contractor, with references made to their duties.
• Separate payment procedures have also been introduced for on or after termination payment  amount and payment procedures have been brought into compliance with the Housing  Grants Construction and Regeneration Act 1996.
• The definition of insolvency has been amended to reflect the Corporate Insolvency and Governance Act 2020.
• Gender-neutral language is now adopted throughout.

And lastly, the JCT Design and Build Contract 2024:

Intended for projects where a single contractor is responsible for both design and construction, this contract combines a structured layout with clarity of language while incorporating recent legal, regulatory, and practice updates.

The key updates from the 2016 edition include:

• Provisions have been made addressing collaborative working, environmental responsibilities, and dispute handling are now central to the main body of the contract, aligned with the government’s Construction Playbook.
• Like the Standard form, the contract does not include references to the Building Safey Act’s gateway regime or golden thread of information as these would not apply to all projects, but it does identify key dutyholder roles under the CDM Regulations and Part 2A of the Building Regulations.
• The contract now introduces a dedicated payment process for amounts due on or after contract termination.
• The insolvency definition is updated in line with the Corporate Insolvency and Governance Act 2020.
• Payment procedures have been adjusted to comply with the Housing Grants Construction and Regeneration Act 1996.
• The contract also allows parties to choose fluctuations options due to the impact of inflation on the industry. If none is selected then option A will apply by default. 
• The contractors design liability has also been amended to clarify that the contractor shall have no greater duty, obligation or liability than to exercise reasonable skill and care.
• Employer decision timeframes for extension of time claims are more strictly defined with tighter timelines.
• ‘Relevant Matters’ now include events such as epidemics and new legal/government guidance, offering adaptable risk-sharing provisions between the parties.
• The contract now employs gender-neutral language and supports electronic execution and service of notices for the first time.

Some key items to be wary of in general:

• With the new electronic provisions, parties should be cautious that failing to include an email address for each party in the contract particulars means that service of notice by email will not be valid.
• Serving notice by email does not mean immediate service, and it will be deemed to have been received on the next business day.
• The Principal Designer and Principal Contractor will need to be identified within the contract
• In relation to the new Relevant Event and Relevant Matters amendments to include epidemics, parties should note that the contract particulars will need to state that this relevant matter applies. If they don’t it could lead to an extension of time being granted but not loss and expense. 

So those are the key updates captured within the new JCT contracts suite. The biggest change has been the introduction of the Building Safety Act within the main contracts, however, one last item to highlight is that for projects with exceptional risk or specialist legal requirements, for example , higher-risk buildings, bespoke amendments are still recommended. 

To sum up what I discussed today:

• The new JCT 2024 contract suite, released April 2024, incorporate essential requirements from the Building Safety Act and related legislation. Key dutyholder roles (Principal Designer and Principal Contractor) are now explicitly referenced, aligning with Part 2A of the Building Regulations and CDM Regulations. This enhances clarity on safety roles and compliance obligations, though the contracts avoid exhaustive procedural detail.
• The new updates embed clauses on collaborative working, sustainability, environmental responsibilities, and dispute resolution—bringing the contracts in line with the UK Government’s Construction Playbook. The language is now gender-neutral, and electronic signatures and electronic service of notices are permitted, modernising contract operations.
• Timeframes for some employer decisions (like extension of time claims) are now stricter. Payment procedures and the definition of insolvency have been updated to comply with recent legislation, including the Corporate Insolvency and Governance Act 2020 and the Housing Grants, Construction and Regeneration Act 1996. New “Relevant Events,” such as epidemics, have been introduced for flexible risk allocation.
• Both the 2016 and new 2024 JCT forms can be used until 31 March 2025, after which only the 2024 contracts will be valid for new projects. For higher-risk or complex projects, bespoke amendments to the standard forms are still recommended to address project-specific legal and safety requirements