The three main themes of the JCT design and build changes

Rachel Heald is a partner at Hawkswell Kilvington

JCT has now published the long-awaited 2024 edition of the Design and Build Contract family. On reviewing the new Design and Build Contract (DB 2024), it is clear that the drafting changes follow three main themes:

“Many of the 2024 changes are decidedly contractor-friendly, though of course some clients may remove these new protections”

1. Changes in law

Amendments reflecting recent legal developments, for example:

  • Building Regulations Part 2A. To cater for the new requirements of the “dutyholder regime”, DB 2024 includes a new Article 7 for identifying the principal designer and principal contractor under the Building Regulations. Clause 3.16 addresses compliance with both the Construction Design and Management Regulations and Part 2A of the Building Regulations, requiring the contractor to comply with regulations 11F, 11J, 11K and 11L of Part 2A and regulation 11N if it is principal contractor. Clause 2.7.2 requires the client to provide “building information” in accordance with regulation 11A(4).
  • Insolvency. The definition of “insolvent” in clause 8.1 is amended to reflect new insolvency procedures introduced by the Corporate Insolvency and Governance Act 2020 (CIGA 2020).
  • Termination payments. Changes to the post-termination payment provisions, with a new definition “termination payment” and a new clause 8.13 setting out a payment mechanism that complies fully with the Housing Grants, Construction and Regeneration Act 1996.
  • Liquidated damages. New clause 2.29.5 confirms liquidated damages are not recoverable by the client post-termination, following the Supreme Court’s judgement in Triple Point Technology Inc v PTT Public Co Ltd.

2. Contractor protections

Improved rights for contractors, including:

  • Exclusion of fitness for purpose. New clause confirms the contractor is not subject to any fitness for purpose obligation in designing the works. However, fitness for purpose is only excluded to the extent permitted by the statutory requirements, acknowledging contractors’ statutory duties under the Defective Premises Act 1972.
  • Site conditions risk. Clause 3.15, which in JCT 2016 only covers fossils, antiquities and other objects of interest found on the site, now extends to the discovery of asbestos, contaminated material and unexploded ordnance. Contractors can claim an extension of time and loss and expense for these risks, except to the extent that the presence of asbestos or contamination is identified in the contract documents or if the contractor brought such material onto the site.
  • Extensions of time. New clause 2.24.4 gives the client 14 days to request further information about the contractor’s extension of time claim. In clause 2.25.2, the timescale for notifying extension of time decisions has been reduced from 12 to 8 weeks. There are new relevant events for delays caused b:y epidemics that limit the availability or use of labour, or delay the contractor in securing materials or services; and changes in law or the publication of guidance by the UK Government, any local or public authority and the Construction Leadership Council.
  • Loss and expense. The two new relevant events can also be relevant matters, but only if expressly stated in the contract particulars.

3. Modernisation

Drafting changes to reflect current practice, for example:

  • Collaborative working. New Article 3 requires the parties to work in a cooperative and collaborative manner, in good faith and with a spirit of mutual trust and respect. This wording is only an optional supplemental provision in JCT 2016. By moving this requirement into the articles, DB 2024 places greater emphasis on the parties’ behaviour.
  • Sustainability and environment. New clause 2.1.5 encourages the contractor to propose changes to improve the environmental performance and sustainability of the works, and new clause 2.2.2 requires the contractor to provide information about the environmental impact of its materials. Again, these requirements are supplemental provisions in DB 2016.
  • Gender-neutral language. The contractor and client are referred to as “it” rather than “he”.
  • Electronic communications. Clause 1.7 permits notices to be sent by email, with space in the contract particulars for email addresses to be inserted. Notices of termination, which in JCT 2016 must be sent in hard copy, can now be sent by email, but only if stated in the contract particulars.

The 2024 edition brings the JCT form up to date with current law and practice, but is a light-touch update rather than a complete redraft.

The initial view among practitioners seems to be that the changes are not as extensive as the industry had perhaps anticipated, with JCT having chosen not to address all aspects of CIGA 2020 or to include any drafting relating to Building Safety Act 2022 changes that introduced longer limitation periods for certain claims or the new higher-risk building regime. While there is a general obligation to comply with statutory requirements, it would have been interesting to see more detailed drafting.

Many of the 2024 changes are decidedly contractor-friendly, though of course some clients may remove these new protections via bespoke amendments. However, with an increasing trend towards contractors seeking to agree comprehensive limitation of liability clauses, it is surprising JCT has not followed the example of NEC4 by allowing contractors to limit their overall liability under the contract. The only limitation of liability option in the standard form remains the cap on certain types of loss under clause 2.17.3.

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