Even for those who work in the UK construction industry, exactly what the JCT Standard Building Contract does can be somewhat murky.
However, it is necessary to understand this contract. In 2011, over 65,000 complaints about builders were received in the UK alone. The Joint Contracts Tribunal (JCT) has attempted to optimize the building process in the UK by publishing consistent contracts and guidelines that contractors and builders should adhere to.
Today, we’ll cover the basics of the JCT Standard Building Contract so you can gain more clarity when conducting construction projects in the UK or collaborating with UK builders.
Table of Contents:
The Joint Contracts Tribunal (JCT), founded in 1931, represents many interests in the construction and building industries in the UK.
It has produced many standard forms of documentation, such as guidance notes and contracts, for the UK construction sector. Note that if you do come across a reference to a “JCT contract,” it will likely refer to a standard building contract.
These contracts are, like architectural construction documents, extremely helpful, if not crucial, in construction projects.
-
Usually, JCT contracts are made between contractors and employers to facilitate the building project delivery process.
-
The contracts state all relevant terms and conditions, including costs, specifications, and obligations of all parties. Hence, all parties can understand what needs to be done, the due dates, the costs, and who needs to do what.
-
The Standard Building Contract can be used with traditional procurement methods, where the design is finished prior to the beginning of the tendering process. It can also be used along with the JCT Standard Building Sub-Contract.
Note that the JCT rewrites and revises the forms each decade or so. The most recent one is the 2016 version. This includes some new features, including revisions of the Section 4 Payment provisions, revisions of the Collateral Warranties requirements, provisions for Parent Company guarantees and grant of performance bonds, and more.
The Various JCT Contract Forms
JCT contracts are essentially a suite of contracts that can be used to form clear, legally binding, and formal contracts for construction projects.
Their popularity can be attributed to them suiting a wide range of procurement options and projects and their goal of being fair to each party involved.
The range of contracts can be used for everything from simple home extensions to complex, multi-million-pound construction projects.
JCT lists the most commonly used contracts as the JCT Standard Building Contract, Minor Works Building Contract, and Design and Build Contract.
Benefits of Using a JCT Contract
There are many benefits to using a JCT contract beyond responsibilities and roles.
-
Resolution of Disputes: JCT contracts contain information on how to deal with disputes. Often, the provisions will nominate an adjudicator or arbitrator who can make decisions regarding the parties’ accountability. Hence, there is a lower chance of having expensive and long court proceedings.
-
Risk Allocation: Thanks to the contracts’ standard formatting, all parties will usually be familiar with project risks and their distribution for each side. The goal is for the terms to not favor any party.
-
Standardization: Since JCT has been around for so long, their contracts take into account most of the challenges that could be expected to arise during a project. This saves contractors and builders the trouble of drafting a new custom contract.
-
Protection Against Poor Contractors: Contracts can be used to protect against poor contractors. Most eventualities, such as penalties for overdue work, are covered in the contract.
Considerations When Using a JCT Contract
It is crucial that you understand what the contracts include, especially if you are unfamiliar with utilizing them. Here are some things to consider:
-
Requirements Must Be Accurate: A poor assemblage of requirements may lead to unsatisfactory results for the contractor.
-
Time & Money Involved: If there are disagreements, the cost and timeframe of the project will increase, which will result in negotiations over the terms and conditions of the JCT contract.
-
Lack of Flexibility: Once a contract has been made, it will be difficult to change the requirements. Furthermore, any changes made could lead to project delays and higher costs.
-
Beware of Lack of Review: If the agreement has been improperly reviewed or drafted prior to signing or has been heavily amended, you may end up agreeing to unfavorable terms.
Format & Provisions
Most JCT forms follow the following format:
-
Articles of agreement
-
Particulars
-
Conditions
-
Schedules
Conditions are often further subdivided into:
-
Definitions
-
Carrying out work
-
Control of work
-
Payment
-
Variations
-
Damage, injury & insurance
-
Collateral warranties, third-party rights & assignment
-
Termination
-
Disputes settlement
As with all contracts, you might benefit from a solicitor who can ensure that the contract has been properly reviewed and drafted.
Another necessary element in smooth construction work is construction documentation. BluEntCAD provides high-quality drafting services with a quick turnaround time. We serve home builders, real estate developers, large architectural and engineering companies, and custom home designers. Browse our portfolio to see how we’ve helped companies like yours.
Ready to make your next construction project a success with proper construction documentation? Contact us now!