JCT Intermediate Building Contract 2024: What’s New?
Following the eagerly anticipated release of the new JCT Design & Build Contract 2024 and JCT Minor Works Building Contract 2024, JCT has now released the JCT Intermediate Building Contract 2024 suite.
Ross Galbraith, partner, and Zi Chuen Gwi, solicitor, both in our construction team, summarise the changes.
An introduction to JCT Intermediate Building Contracts
These comprise the following:
- Intermediate Building Contract
- Intermediate Building Contract (with Contractor’s Design)
- Intermediate Sub-Contracts
In addition to the main contracts, sub-contracts and guides from the JCT Intermediate Building Contract 2024 suite, JCT has also released the Intermediate Building Contract and Intermediate Building Contract (with Contractor’s Design) 2024 Admin – Contract Administration Model Forms, which are available digitally only.
JCT Intermediate building contracts are generally used when works involve all the recognised trades and skills of the industry, but without complex building service installations or other specialist work.
These contracts are more detailed than the Minor Works Building Contract and contain fairly detailed contract provisions but are not as exhaustive as the JCT Design & Build and Standard Building Contracts.
It is worth noting that the JCT Intermediate building contracts must be administered by an architect/contract administrator and quantity surveyor.
The updates to the JCT Intermediate Building Contract 2024 suite largely resemble the updates to the JCT Design & Build Contract 2024 and JCT Minor Works Building Contract 2024 (with some subtle differences).
We have summarised the key changes below:
1. Building Regulations
A new Article 7 requires the parties to confirm who the principal designer and principal contractor will be for the purposes of the amended Building Regulations.
Updates have also been made to ensure that the contractor complies with the relevant sections of the amended Building Regulations.
2. Collaborative working, sustainable development and notification of disputes
New provisions relating to collaborative working, sustainability and notification of disputes (which were previously optional supplemental provisions) have now been introduced into the main body of the JCT terms.
A new Article 3 states that the parties must work together and with the project team in a cooperative and collaborative manner, in good faith and in a spirit of trust and respect.
In addition, the contractor is encouraged to suggest economically viable amendments to the works to improve environmental performance and sustainability, and a reduction in environmental impact.
3. Contractor's design liability
The JCT Intermediate Building Contract (with Contractor’s Design) 2024 includes some key changes to the contractor's design liability in respect of the contractor's designed portion.
A new clause makes it clear that, to the extent permitted by the statutory requirements, the contractor will have no greater duty than to exercise reasonable skill and care in respect of its design and "under no circumstances" shall it be subject to a fit-for-purpose obligation.
4. Extensions of time
The JCT Intermediate Building Contract 2024 suite has included some minor changes to clause 2.19 relating to assessments of delays by the architect/contract administrator. However, the process for assessing delay is broadly the same as the 2016 edition.
The updated relevant events and relevant matters included in the JCT Design & Build Contract 2024 relating to epidemics and statutory powers have been included in the JCT Intermediate Building Contract 2024.
5. Epidemics and Statutory Powers
In light of the COVID-19 pandemic, a new relevant event has been added allowing the contractor to claim an extension of time if there is an “epidemic”.
The relevant event relating to the UK Government exercising its statutory powers has been widened to include “the publication of any guidance” by UK Government, local authorities etc., and specifically the Construction Leadership Council.
No doubt this addition has been influenced as a result of the COVID-19 pandemic when the government published numerous guidance notes throughout this period.
The above relevant events are also relevant matters which may entitle the contractor to additional money albeit they are now dealt with as optional entries within the contract particulars.
6. Insolvency
The definition of ‘Insolvent’ has been expanded to cover developments in insolvency law.
7. Ground conditions
Unlike the JCT Design & Build Contract 2024 suite, the JCT Intermediate Building Contract 2024 suite does not contain provisions relating to the employer taking on the risk of asbestos, contaminated material and unexploded ordnance found in the ground.
This is not surprising, given that the JCT Intermediate Building Contract 2024 suite will be used for less complex works/projects, unlike the JCT Design & Build Contract 2024 suite which is normally used for large and high-value projects.
8. Termination payment
The new JCT introduces a new defined term, “Termination Payment”. Together with some new clauses in the termination section, this provides a more structured approach to the final payment when a contract is terminated.
9. Professional Indemnity Insurance
The contract particulars now include a space which allows users to set out a PI insurance policy’s specific sub-limits and exclusions.
Previously, any sub-limits related to pollution and contamination only and users were not able to set out any specific exclusions.
This change reflects the evolving nature of the PI insurance market and how common exclusions, such as those relating to fire safety and cladding, are becoming.
10. Modernisation
The JCT Intermediate Building Contract 2024 suite adopts gender-neutral language and has moved away from references to “he” and “workmen”.
The suite also allows for the delivery of notices by email and accommodates electronic signatures.
What next?
JCT will continue to issue each contract family in the 2024 suite on a rolling basis throughout this year. A new Target Cost Contract (TCC) family will also be released, which will comprise a sub-contract and guide.
For more information on the above changes, or if you have any questions on construction law in general, please contact Ross Galbraith using [email protected] or 0191 211 7999.