JCT 2016 Suite of Contracts, watch this space

You may not be aware but the Joint Contracts Tribunal (JCT) is set to launch a new 2016 Edition suite of its contracts later this year. At the moment it appears that the documents will be released on a piecemeal basis, with the Minor Works contracts to be released first, although the exact dates are yet to be provided.

What will change?

Given the comprehensive use of the JCT contracts within the industry the changed being made to them will have a significant impact. We will provide you with a more detailed note once the contracts are released and the detail is clearer, but in the meantime the JCT has provided a summary of the main points of change on its website, including:

  • Provisions incorporating the new CDM Regulations 2015.
  • Amended payment provisions – there appears to be a focus upon bringing the JCT contracts in line with the government’s Fair Payment Charter, including:
  • Establishing Interim Valuation Dates which will operate at main contract, sub-contract and sub-subcontract levels.
  • Continuing the monthly payment cycle after practical completion up to the due date of Final Payment.
  • 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.
  • Parent Company Guarantee’s and Performance Bonds – JCT 2016 will include provisions for the grant of security documents.
  • An extension to Insurance Option C to overcome a difficulties currently experienced by tenants and domestic homeowners in obtaining Existing Structures cover for Contractors. There will also be amendments to clarify the interaction between Insurance Options A and B.
  • 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.

What will I need to do?

Apart from understanding the new documents and training users in order that the contracts can be operated successfully, we anticipate that work will need to be done to update systems and documents to accommodate the changes.  For example contractors will need to amend their standard form sub-contracts if they currently incorporate and amend JCT 2011 sub-contracts.

We will of course be on hand to assist with any amendments and ‘health checks’ required, and to provide any necessary training.

If we can assist you in any way, or if you simply want to discuss the needs of your construction and engineering project, we would be delighted to meet with you either in our office or at your office to discuss your issues. Please contact us at any time.

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