Overview of JCT 2009 Contracts
In May 2009, the JCT began publishing revisions to its standard form contracts which it rolled out through the year. All the JCT forms and associated documents are affected by the change. The changes mainly focus on sustainability in construction and the Achieving Excellence in Construction criteria, but there are changes to administrative matters too, in particular, payment and retention, the use of framework agreements and the way in which disputes are to be resolved. The key changes are, in summary:

• The default position is that the parties will adopt the Achieving Excellence in Construction criteria by incorporating published Supplemental Provisions. The parties can opt out of these by completing the appropriate part of the revised Contract Particulars. If included, these criteria cover:
  • Health and Safety – obligations to create a culture where health and safety is paramount
  • Collaborative Working provisions
  • Proactive input from the Contractor on life cycle/works cost via design changes
  • Sustainability and environmental performance considerations
  • The introduction of KPI’s for performance monitoring
  • Provisions for notification of disputes and for senior executives meetings to negotiate on disputes.
• There is provision for the parties to state whether the Contractor’s master programme must show critical path information. For experienced employers, this will be a welcome change
• Acceleration – a quotation must be submitted by the Contractor where the Employer wants to look at the possibility of early PC;
• Certification and payment – the default position is interim certificates every 2 months after Practical Completion; certificates issued late (or never) by the Employer attract interest from the date which would have been the final date for payment if they had been issued on time.
• Retention – there is now standard wording allowing for a retention bond in place of the withholding of retention.
• Framework Agreements – the increasing use of these is recognised by the inclusion of recitals which recognised that these may be used
• Termination – previously, the parties could give a 14 day “warning” notice then determine the Contractor’s employment within 10 days after expiry of that initial 14 day period. The 10 days has been increased to 21 days.

There are numerous other drafting changes some of which improve clarity, and others which don’t (including some amendments to the provisions on the deduction of liquidated damages). Will the changes make the contract forms more efficient and less prone to challenge? We will have to wait and see. However, with the impending changes to the Construction Act that will come via the LDEDC Act 2009 (see below), we know for certain that the JCT already have more changes to the payment provisions of their contracts in the pipeline – so watch this space…

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